A budget proposal from Arlington’s county manager would increase the average homeowner’s tax and fee burden by $500.
But the budget does not include adequate funding for the police and fire departments, according to unions for both.
County Manager Mark Schwartz over the weekend introduced a $1.62 billion budget proposal for Fiscal Year 2025, which starts July 1. The proposal represents a 4.7% increase over the current budget and comes with a 1.5 cent real estate tax rate increase.
Last year’s $1.55 billion budget held the tax rate steady, at $1.013 per $100 of assessed property value.
Between the higher rate ($1.028 per $100), a 3.2% increase in assessed residential values, and other rising fees, homeowners will see their tax burden rise by 4.7% — or about $500 — on average.
“This includes a $389 increase in real estate taxes, a $122 increase in stormwater fees, a $10 increase in household solid waste fees, $38 increase in water/sewer rates, and a $59 decrease in the personal property tax burden,” per the full proposal.
The rising rate and property values will also put upward pressure on rents.
“If you are a renter, the average increase for apartment unit assessments is 6.6%. This translates to an average real estate tax burden increase of $215,” the proposal adds, while noting that “apartment dwellers who own cars would see their average tax burden drop by about $30 for each vehicle owned.”
On a call with reporters Monday, Schwartz said that the 4.7% increase in the residential tax burden is “consistent” with recent budget years, in which steeper rises in real estate values led to a 4-5% annual increase in the tax burden, even without higher tax rates. It also comes at a time of declining office property values, a significant source of revenue for the county.
The budget would eliminate 33 county staff positions — many that are currently vacant — in various departments, saving about $10 million, according to Schwartz. Some reductions “will limit services in some less critical areas” while others “can be taken without impact on services,” he said.
The stormwater fee has been moved from being a tax — accounting for 1.7 cents per $100 of the property tax rate — to being a fee calculated based on a property’s impervious surface.
The budget includes a 4.75% salary increase for all non-union county employees, which Schwartz says is necessary to keep up with inflation and remain competitive as an employer. Other areas of increased spending, prioritized in the budget following guidance from the County Board in December, include:
- Arlington Public Schools, which is getting $10 million in additional funding to help close a projected $30-35 million budget gap
- Teen programs, which advocates say can help combat the teen opioid crisis. Schwartz says the programs need “additional, reliable funding.”
- Mental health and substance abuse programs
- Affordable housing and eviction prevention
- Environmental initiatives, including a climate action fund and additional tree maintenance funding
One area that needs more funding is public safety, according to Arlington’s police and fire unions.
They’re calling for the tax rate to be raised an additional penny to fund pay increases and reverse staffing declines, particularly in the police department.
Press release:
Staffing at ACPD is bad….sad for such a wealthy well run county. We are hoping for better, but hope is not a plan, we need immediate action to retain what we have left of our police force. @ARLnowDOTcom @STATter911 @fox5dc @washingtonpost @nbcwashington @WTOP pic.twitter.com/iPrcRv57AQ
— Arlington Coalition of Police (@ArlingtonCOPS) February 26, 2024
The proposed budget is the result of both guidance from the County Board and public feedback over the past few months. The Board tonight will vote on an advertised tax rate, setting the maximum rate they could later approve in the final budget.
The Board will conduct a series of budget work sessions in March, followed by a pair of public hearings on the budget and the tax rate on April 2 and 4, respectively. The final budget adoption vote is scheduled for Saturday, April 20.
More on the budget proposal, below, from a county press release.
With a focus on the community’s needs and priorities, while addressing a shortfall in the coming fiscal year, County Manager Mark Schwartz proposed the FY 2025 budget to the County Board on Saturday, Feb. 24, 2024. The proposal addresses guidance given by the Board, which directed the Manager to prepare a balanced budget that reflects County priorities while also acknowledging the economic pressures taxpayers and homeowners are experiencing.
$1.62 billion is proposed in General Fund spending, a 4.7 percent increase over FY 2024. The County’s General Fund Budget provides foundational services for the community including public safety, human services, environmental services, transportation, and schools.
The budget is based on 2.5 percent growth in real estate assessments (compared to 3.7 percent growth in 2023), and a 4.5 percent growth in overall tax revenue.
To balance the budget, the County Manager proposed nearly $10.1 million in budget reductions and operational efficiencies in two categories: reductions that will limit services in some less critical areas, and reductions that reflect changing demands and can be taken without impact on services. The proposed budget reduces a combination of 33 filled and vacant positions.
The proposed budget also recommends a 1.5 cent tax rate increase per $100 in assessed value, offset by the 1.7 cent reduction in the tax rate by moving to a stormwater utility fee. The proposed tax rate increase would fund priority needs that face our community—including affordable housing and eviction prevention, teen substance use and mental health intervention and prevention investments, and investments in the environment.
“Our community remains vibrant, and while we are now four years removed from the onset of the COVID-19 pandemic, challenges still remain, namely increased office market vacancies and stress on our social service network,” said Schwartz. “This budget proposal helps us meet the needs for the community, while recognizing that we need to be resilient, focus on equity, maintain our outstanding workforce, and combat the effects of climate change.”
Existing office property values decreased by 11 percent due to continued pressure of vacancy rates and changing demand for office space but were partially offset by new construction. The County continues to focus on the Commercial Market Resiliency Initiative (CMRI) 2.0 to support this sector of our local economy, with investments to increase capacity to review and draft changes to the zoning ordinance and efforts to change the urban dining and retail environment.
Investments in the Community
The proposed FY 2025 budget is the result of months of study, evaluation, and input from the public. Core investments in the proposed budget include:
- Schools: The proposed budget includes a County transfer of $626.5 million to Arlington Public Schools. This is $621.1 million in ongoing funds, an increase of 4.5 percent over FY 2024, and $5.4 million in one-time funding.
- Housing Support: The proposed budget includes $110 million dedicated to housing programs, with an emphasis on stabilizing housing for households in need. These investments include $15.1 million for the County’s Housing Grant Program, which also supports a new pilot housing grants category for youth aging out of foster care, $5.7 million for Permanent Supportive Housing, and $2.3 million for Eviction Prevention. The budget also includes $20.5 million for the Affordable Housing Investment Fund (AHIF).
- Investments in Teens: The Manager’s budget includes $1.2 million for intervention, prevention, and education efforts to address teen mental health and substance use. Investments include funds for dedicated case management for teens experiencing mental health and substance use challenges, expansion of out-of-school teen programming, and new digital and in-person outreach strategies to share programming and resources with teens and families. This funding is in addition to existing youth programs with Arlington Public Schools, Department of Parks and Recreation, Department of Human Services, Juvenile and Domestic Relations Court, and other County departments.
- Investments in the Environment: Investments in the proposed budget include $1.0 million for the Climate Action Fund, an additional $1.0 million for tree maintenance, and $300,000 to proactively address emerging invasive threats to Arlington County natural lands. The proposed budget also allocates $1.5 million for capital investments in energy performance and renewable energy installation in County facilities and increasing the number of vehicle chargers in Arlington.
- Workforce Investment for County Employees: The proposed budget includes salary increases for County staff and a new retirement program for general employees hired after January 1, 2025.
Budget Engagement Process
The County Manager collected feedback from the community on approaches to balancing the budget including which services and programs should be kept as top priorities through an online form and in-person pop-up engagement opportunities. Over 3,400 participants weighed in on the budget, either online or in-person, and the feedback helped the County Manager determine where to apply resources. View the Engagement Overview.
Tax Rate & Next Steps
During the Tuesday recessed meeting on Feb. 27, 2024, the County Board will hold a public hearing and consider authorizing advertisement of the proposed real estate, personal property, and Business Improvement District Calendar Year 2024 tax rates, as well as proposed fee changes for FY 2025. Register to Speak at the Feb. 27 Recessed County Board Meeting.
Additionally, the Board will review the budget proposal and conduct a series of work sessions starting in early March. The County Board will then hold a public hearing for the budget on Tuesday, April 2, and a public hearing for the tax rate on Thursday, April 4. Members of the community can sign up to speak at the public hearings in-person or virtually; registration to sign up opens five business days prior to the hearing dates. Visit the County Board Webpage to sign up as a speaker.
The final vote on the FY 2025 operating budget is scheduled for Saturday, April 20. The fiscal year begins on July 1, 2024.
Learn more about the FY 2025 Budget at arlingtonva.us/fy2025.