Property taxpayers will face bigger bills this year, but the increase won’t be as much as last year.. In a special session on Monday night, the City Council voted to pass a $493.7 million general fund budget for fiscal year 2007. That’s a 5.5-percent increase over the $467.8 million budget the council voted for last May — a 4.9-percent increase over the amended budget that includes several million dollars that were added after the vote.
With a tax rate of 81.5 cents for every $100 of assessed value, the average tax bill for a single-family home will rise $267 from $5,172 to $5,439. The average condominium bill will rise $250 from $4,035 to $4,294. Overall, the average bill will rise $259 — a smaller hit that last year’s average $418 tax bill increase. Since 2000, the average tax bill has doubled.
“This year’s increase is significantly smaller than last year’s increase,” said Vice Mayor Del Pepper. “At this time next year, we hope to do even better.”
City schools will get about $150 million, which is $2.3 million less than the School Board requested in January. After Monday’s special meeting, Superintendent Rebecca Perry said that she would come up with several spending reduction options to present at the next School Board meeting.
“We’ll have to look everywhere,” Perry said, adding that 85 percent of the schools budget is for personnel. “I’ll present the options, and the School Board members will have to make the ultimate decision.”
CAPITAL IMPROVEMENTS took the biggest hit, with the City Council voting to postpone or eliminate $7.5 million worth of projects. One of the most expensive items on the list of postponements includes $500,000 for undergrounding utilities in Old Town. Councilman Paul Smedberg said that this particular item had been postponed for many years, and during a work session before he suggested that indefinitely postponing the item would not be wise.
“Every year, it’s an easy way to knock $500,000 off the budget,” Smedberg said. “We’ve either got to do it or take it off the books.”
Other postponements include: $2.8 million toward a new police headquarters; $500,000 worth of improvements to Chinquapin Recreation Center; $100,000 for alley rehabilitation; $262,500 for emergency generators; $75,000 for improvements to the city’s emergency operations center; and $50,000 of bus shelters.
“We want to get people out of their cars, but we’re going to cut funding for bus shelters?” asked Katy Cannady, a citizen activist who was in the audience. “I think that’s a priority different from what the people said they wanted.”
City Manager Jim Hartmann warned City Council members that postponing $7.5 million worth of capital projects would create hurdles next year.
“Going into next year, we are going to be challenged,” said Hartmann. “We deferred a lot of capital.”
Councilman Rob Krupicka agreed that postponing capital improvements was a temporary fix. He said that the next City Council will have to take a hard look at the capital budget.
“You can’t keep balancing the budget on the back of the C.I.P.,” Krupicka said. “Next year, we’ll have to be mindful of that.”
THE BUDGET RESOLUTION comes in the midst of a citywide campaign in which all but one of the City Council members are seeking reelection. Councilwoman Joyce Woodson decided not to run for reelection because she couldn’t find a campaign manager. Nevertheless, Woodson resolved to speak her mind at Monday’s special budget passage meeting — calling on the next council to seek more cost-saving efficiencies.
“I think we have entirely too many boards, commissions and task forces,” Woodson said. “They’re here every night of the week.”
Many of the council members who were running for reelection were eager to portray the budget in the most positive light. They talked about how Alexandria had the second lowest tax rate in the region — for the first time coming in lower than Arlington. They noted that the 4.9-percent spending increase, which compares the “amended budget” to the one council members voted for this week, was lower than other localities in the region.
“Our rate of growth is lower than any other,” said Councilman Ludwig Gaines. “We met out priorities while maintaining core services.”
The final budget also added $600,000 to a tax rebate program for seniors and the disabled and $1 million to a tax rebate program for moderate-income homeowners. City employees will receive a 3 percent cost-of-living increase, but they’ll have to contribute more to their health-care coverage. And the city’s dedicated source of funding toward purchasing open space has been reconfigured in a way that reduces the amount of money that will go toward the program next year.
AFTER THE VOTE, Mayor Bill Euille warned that the City Council wouldn’t continue to lower the tax rate every year. He said that economic cycles demand that City Hall be flexible, and that a future downturn in the real-estate market might prompt a higher tax rate.
“It’s still hot, but it’s going to cool off,” Euille said. “And then, we’re going to have a downturn.”
Until then, he said, the city’s budget staff would be hard at work.
“We’ll commence working on next year’s budget in about two hours,” he said toward the end of Monday’s meeting.
“I see our budget staff shaking their heads,” said Vice Mayor Pepper. “We’d better give them a break.”