The Alexandria City Council passed a $588 million budget for the next fiscal year Monday night without raising the property tax rate, although the average homeowner will see $52 increase in their tax bills because of higher property values.

The 2013 budget passed unanimously, but council member Rob Krupicka was the sole dissenter on setting the tax rate at 99.8 cents per $100 of assessed value, arguing that failing to raise the tax rate now will simply mean future councils will have more difficult decisions to make.

“We were able to hold the tax rate flat because we took money set aside” from the city’s reserve or surplus fund, Krupicka said. The budget also cuts about $1 million in human services and takes $1.2 million that the Virginia General Assembly allocated for schools and uses it to balance the city’s budget.

The schools will receive $179.5 million, an increase of 2.6 percent, which Mayor William Euille (D) said proves the city government’s commitment to schools as well as to police and fire services.

City employees will receive $3.3 million in merit raise increases, and another $900,000 was set aside for improving the pay scale for public safety officials, after several years of no raises or career ladder improvements, council members said.

Council members spent 90 minutes before their formal meeting haggling over several million dollars for smaller needs, such as restoring $70,000 for senior citizen taxi reservation services, $85,000 to fund a position to prevent gang crime that had previously used federal funds and $65,000 to help prevent teen pregnancies that had been cut by the state.

The highlight of that session was when council member Del Pepper sought support for her effort to keep the holiday lights on King Street burning all year round. Council member Alicia Hughes said she had been dining at Pentagon Row recently where the lights in the leafy trees were “one of the most ugly things I’ve seen in nature. The consensus of my dinner group was it looked god-awful.”

Pepper’s effort failed, although probably not because of the opinion of Hughes’ dinner companions.

Euille and Vice Mayor Kerry Donley met with top local school officials before the budget meetings to work out some of the tensions that have arisen between the two jurisdictions since last fall.

The city is requiring the school district to use $1.2 million that it previously set aside to cover the employees’ contribution to the Virginia Retirement System. School officials would have preferred to get that money from the city rather than use the one-time-only reserve.

Both sides blamed the General Assembly for its last-day-of-the-session decision to require that employees pay 5 percent of their salary into the retirement system. The legislature also ordered local jurisdictions to give employees a 5 percent raise, but local officials said that because of Social Security and other rules, it’s not an even swap. Unlike Arlington and Fairfax counties, Alexandria opted to phase in the 5 percent contribution and salary requirement at 1 percent per year over the next five years.