No tax increase in City budget proposal, ACPS gets fully funded

New City Manager James Parajon may be trying to make a good first impression with city residents. His first budget — a continuation of one started under former City Manager Mark Jinks — comes with no new tax rate increase. Even so, with real estate assessments on the upswing, local homeowners can still expect to see taxes go up.

In a meeting today, Parajon joined Budget Director Morgan Routt and other city officials to present the fiscal year 2023 budget to the City Council.

The budget is $829.9 million, or a 7% increase from the previous year’s budget.

“This budget does not contain a change in the tax rate,” Parajon told reporters at a meeting earlier today. “The Council asked to provide an alternative A, which is a modest tax rate increase, and an option B, which is a more substantial rate of increase.”

Those rates, Parajon said, would be a 1 penny per $100 of assessed value increase or a 2 penny increase.

The budget office was also able to save more with $1 million in efficiencies and by ARPA funding — of which $21 million is included in the budget. A large portion of that, Parajon said, will be dedicated to affordable housing.

Though the recommended budget does not change the tax rate, Parajon said the budget is funded largely through revenue growth related to real estate assessments.

“The real estate market did not slow down during the pandemic,” Parajon said. “In fact, we’ve seen significant assessment increases.”

City residents can expect a $14 utility fee increase, though, from an estimated $280 to $294.

“That helps us accelerate stormwater management and flooding mitigation,” Parajon said.

Parajon said residents can expect an average $445 per year increase in their taxes, with assessment growth factored in. Routt said the increases would come out to an average $66 increase per penny — or $511 and $577 for the 1 and 2 penny increases.

Most of the budget increase is dedicated to compensation adjustments for staff:

• Firefighters, medics, fire marshalls: 6% pay scale adjustment
• Police department and Sheriff’s office: 5% pay scale adjustment
• General employees: 4% pay scale adjustment

Parajon said that’s in addition to the annual step increases for all in those sectors.

Josh Turner, President of IAFF Local 2141, said it’s a good step but not enough.

“Though we appreciate the new City Manager’s efforts to fix the pay issues found in our department, this proposal does not do enough to stop the bleeding,” Turner said. “When you’re down by 20 in the fourth quarter, it’s not enough to just score when the other team scores. We need to do a full court press to play catchup.”

Turner said in the last two weeks, the city’s lost an additional three firefighter medics, who left for better pay and working fewer hours in neighboring jurisdictions.

“It takes three years for us to recruit, train and get someone street ready as a firefighter medic,” Turner said. “A six percent increase is substantial, but with Fairfax, Arlington and other jurisdictions offering an even greater increase it puts us even farther behind our competitors. If an Alexandria firefighter makes 70k and gets a 6% increase, but a Fairfax firefighter makes 85k and also gets a 6% increase, the pay gap between the Alexandria and Fairfax firefighters is even higher now.”

Alexandria’s police union said on social media the department is facing a similar dearth of new recruits to make up for those leaving.

Question: What is missing from this picture?

Answer: Police applicants.

We had a test scheduled today for those interested in becoming a police officer.

NOT ONE PERSON SHOWED UP.

This is what happens when the City doesn’t provide a competitive compensation package. pic.twitter.com/dTZYjlJZUD

— IUPALocal5 (@IupaLocal5) February 15, 2022

Meanwhile, Parajon said the recommended budget will fully meet the requests of the ACPS budget, which will include a 10.25% raise for teachers.

The budget also includes a 2.4% increase to the 10-year capital improvement plan (CIP).

“A big portion of that does include funding for initiatives that occurred over this last year, particularly in school construction,” Parajon said. “That includes full funding of the ACPS CIP, which includes the new high school facility at Minnie Howard and the purchase and renovation of an office building.”

The CIP includes $288 million to expand floodwater mitigation efforts, including projects in the Glebe Road area and spot improvements throughout the city. The CIP also includes $200 million to renovate city facilities.

After tonight’s meeting, Parajon is scheduled to present the budget to the public on Thursday, Feb. 17 at 7 p.m. There will be nine work sessions throughout the spring to review the budget. A special public budget hearing is scheduled for Monday, March 7, and a tax rate add/delete hearing on April 23. Final budget adoption is scheduled for May 4.