Alexandria City Council unanimously approved City Manager Jim Parajon’s $979.1 million Fiscal Year 2027 budget with a few changes Wednesday night.
The budget represents a 2.4% increase over the FY2026 budget and maintains the real estate tax rate of $1.135 per $100 of assessed value, although some City Council members expressed caution about a potential tax increase in next year’s budget. Property owners whose assessment values increased could still see higher tax bills under the unchanged rate.
Parajon was able to craft a budget without a tax rate increase through $9 million in citywide cuts, the elimination of 38 vacant positions and five over-hire full-time employees, and increases to a number of fees and fines — including metered parking rates, parking fines and the stormwater utility fee, which rises from $340.30 to $357.40. City Council also added a 5-cent increase to the city’s Business, Professional and Occupational License (BPOL) tax during the add/delete process.
Mayor Alyia Gaskins said she’s proud of the budget and that City Council had to balance investing in critically important programs while maintaining affordability.
“Despite all those tough choices, I’m proud to be a part of a council where we don’t shy away from asking tough questions,” Gaskins said. “It was tough this year and it’s probably going to be tough next year, but I think we’ve shown that as a community we can wrestle with those tough choices and we can produce something that will benefit everyone in this community.”
“Each year, the budget process challenges us to make thoughtful, strategic choices, and this year was no exception,” Parajon said in a release. “The FY27 budget maintains the high-quality services our community counts on while making steady progress on housing, community services, and economic development.”
Vice Mayor Sarah Bagley said said she hopes to begin the FY2028 budget dialogue with residents and city staff sooner.
“Alexandria was hardest hit, I think, in the country in terms of federal job loss and impacts,” Bagley said. “And yet, we didn’t have to raise taxes here, and that’s a pretty significant accomplishment for our staff, but we may not be so lucky next year.”
City Councilman John Taylor Chapman said that the city needs to be cautious about raising fees.
“I think over the past couple years as we’ve not raised property taxes, we’ve raised a lot of fees, and I don’t think that should go understated,” Chapman said. “There are going to be segments of our community that are going to find what they do, their regular business that they’ve done with the city, a little less affordable, because we’ve changed those fees directly for the purposes of trying to fill holes in our budget. I don’t think that’s sustainable.”
The budget fully funds the third year of the city’s labor and trades collective bargaining agreement, as well as the first year of its new administrative and technical, fire, and police collective bargaining agreements. Staff ineligible to participate in collective bargaining will receive a step increase and a 1.5% pay scale adjustment.
While City Council approved an increase of $4.2 million (1.5%) increase in the operating transfer to Alexandria City Public Schools, it did not fill the $5.6 million gap the school system needs to fund its proposed collective bargaining agreement that the school system needs to fill for its proposed collective bargaining agreement.
The budget also includes:
- $619,920 to increase frequency of DASH Bus line 32
- $200,000 for a jail operational efficiency study taken from the Alexandria Sheriff’s Office budget
- $350,000 for improvements to the pedestrian zone in the 200 block of King Street
Capital improvements
The approved FY2027-2036, $2.01 billion Capital Improvement Program (CIP), is a $64.7 million decrease over last year’s 10-Year CIP.
The CIP budget includes:
- $193.6 million for ACPS capital projects
- $782 million to fund the city’s Capital Facility Maintenance Programs, state of good repairs programs, and other major renovations projects, including City Hall
- $230.1 million for investments in the city’s stormwater management systems, including improvements to mitigate flooding during major rain events
- $177.3 million and state and federal grant sources identified to support transportation and transit projects
- $192.6 million to support Metro capital improvements
- $67.2 million for the city’s street reconstruction and repaving program
The CIP includes five capital projects or programs with a construction contract value estimated to be greater than $35 million. The projects, listed below, will be “explored further for implementation of PLAs (project labor agreements),” according to the city.
Highlights from the proposed capital budget are below.
- $76 million in planned transportation infrastructure projects
- $25 million capital funding request to ACPS
- $22.3 million for stormwater management projects; including $7.1 million for capacity improvements at Commonwealth Avenue, E. Glebe Road, and Ashby Street
- $22.2 million to purchase wastewater capacity at AlexRenew
- $15.8 million for the City’s contribution to WMATA’s Capital Improvement Program
- $12 million for the renovation of City Hall, Market Square Plaza, and Parking Garage
- $11.6 million for investments in affordable housing
- $9.3 million to support DASH Bus Fleet Replacement/ state of good repair rolling stock replacement
- $9.3 million to support Old Town Pool Renovation project
- $5.6 million for street reconstruction and resurfacing, which will support the resurfacing of approximately 50-55 lane miles in FY 2027
- $5 million for capital maintenance of parks, playgrounds, recreation centers, and other public spaces
- $2 million for improvements at John Ewald Park
The budget goes into effect on July 1.
