No tax-rate rise for property owners, but increases in the meals tax and charges for some county services, are part of the $1.69 billion draft fiscal 2026 budget unveiled Saturday (Feb. 22) by Arlington County Manager Mark Schwartz.
The proposal represents an increase of 2.2% from the current spending package. Schwartz said it aims for a balance between meeting core needs, addressing concerns from homeowners about tax burdens, and contingency planning for uncertainty in federal spending and the economy.
The budget proposal will “change and adjust to the circumstances,” Schwartz said in handing it over to Board members, and will “ensure that Arlington remains a beacon of stability” no matter what happens at the national level.
“We have always done, and will do, what’s needed to redirect our resources to the people and places in need in our community,” said Schwartz, who has been county manager since 2016.
The proposal calls for a real-estate tax rate of $1.033 per $100 assessed valuation, unchanged from the existing rate. Last year, the tax rate increased slightly — making for a double-whammy on homeowners already facing higher assessments.
Even if the rate is unchanged, homeowners will still pay more — on average, about $312 — in real-estate taxes owing to higher home assessments.
Schwartz proposes funneling $647.4 million, or 46.8% of all local tax revenue, to the school system. That would be up 3.6% ($22.6 million) from the last year’s transfer, but up only 1.2% ($7.7 million) if factoring in supplemental, one-time funding provided to schools as part of the fiscal 2025 budget.
The budget proposes increasing the county’s meals tax from 4% to 5%, bringing in an additional $13.3 million. The current rate has been unchanged since 1991; the state maximum is 6%.
Increased fees will be coming to some park programs, development processes and ambulance services under the proposal.
Schwartz proposes to eliminate 44 positions, about half of which currently are filled.
A compensation increase of 3.5% for county staff not in bargaining units is proposed, with larger increases those covered by collective-bargaining agreements. The highest average proposed increases would go to firefighters at 11%, followed by police at 9%.
Targeted additional funding has been recommended in a number of areas, including the environment, housing and public safety.
The nearly 1,000-page budget proposal also puts an additional $11 million into reserves, and leaves $1.5 million for Board members to allocate as they see fit.
Board members on Tuesday evening (Feb. 25) are slated to advertise a host of changes to tax rates and fees in advance of public hearings slated for late March.
It is possible, even likely, Board members will advertise an increase in the real-estate tax rate. Advertising a tax-rate increase does not mean one necessarily will be imposed, but it allows the county government to do so.
After a series of work sessions, public hearings and community gatherings, the fiscal 2026 budget will be adopted in early April. It goes into effect July 1.
On top of uncertainty at the federal level, challenges to Arlington’s budget include an ongoing reduction in the valuation of commercial properties.
The year-over-year decline in that property sector restrained overall revenue growth to a projected 2.2% for the coming year.
