Alexandria taxpayers may see increases in property taxes and three city fees starting in July because of higher costs for Metro, schools and sewers, City Manager Mark Jinks said Tuesday in his fiscal 2018 budget recommendation.
The proposed $712.5 million general-fund budget would require an increase in the real estate tax rate of 2.7 cents, from $1.073 to $1.10 per $100 of assessed value, boosting the average residential tax bill by $197 per year.
The proposal also foresees a $400,000 increase in the separate $2 billion capital improvement budget over the next 10 years, including $160.6 million for Metrorail’s massive safety and infrastructure project; a $144 million increase for schools to handle booming enrollment; and $386 million for the combined sewer system construction in Old Town.
Jinks said the city is at a crossroads in the face of “anemic” revenue growth of less than 2 percent and increased demands for services. Prudent investments, he said, will cost more at first but will pay off by maintaining a high quality of life and keeping the city fiscally, socially and physically sound.
He has been warning of a difficult fiscal year ahead for months. Last fall, he said the city faced a budget gap of $25 million, and that was before it was clear that public school enrollment was going to grow by 400 students next year while two-thirds of all homes either decreased or stagnated in value — which means no built-in tax increases for the city.
The City Council, which will decide whether to accept or change Jinks’s proposal, will hold 10 work sessions and several public hearings in the next two months, with a final budget and tax rate adoption May 4.
In addition to higher property taxes, Jinks proposed a new storm water utility fee that would cost homeowners an average of $70 in the second half of this year alone, and would cost commercial land owners more based on the impervious surface area of their property.
The sanitary sewer fee would jump 30 percent, from $1.40 to $1.82 per 1,000 gallons next year, and would go up 500 percent in stages over the next decade.
About half of the sewer construction is required by federal Clean Water Act mandates, and the state General Assembly probably will require that the city accelerate its plans to deal with the other half. Jinks called that acceleration “overly aggressive . . . [and] unreasonable,” but the city will ask the state to help cover some of that cost.
Finally, the residential refuse fee would rise $10 per year, to $373.
“I think the community in the past has shown a willingness to pay for city services and investments,” Jinks told reporters Tuesday afternoon before presenting his recommendations to the council. “If you think your money is used well, you’re willing to pay.”
The tax increase, he said, is the smallest in five years and the tax rate remains one of the lowest in Northern Virginia. The cost of city operations is going up by less than 1 percent, and the 2,564 city jobs will be one fewer than this year, down about 100 since 2009.
Schools, always a hot-button issue in the Northern Virginia suburbs, would get an additional $7.5 million, although the superintendent requested $9.6 million. The schools’ construction plan calls for $611 million over the next decade to replace the Minnie Howard campus of T.C. Williams High School, the construction of a new middle school and replacement and modernization of five elementary schools. Jinks instead proposed $373 million.
“While these are important projects, it is not realistic for the city to suddenly provide such an enormous increase in funding,” Jinks said. “This increase should be sufficient to build a new ninth-grade center, a new middle school and eventually a new elementary school when enrollment increases justify it.”
Unaddressed in his capital budget are $325.2 million in needs over the next 10 years, which include $203 million for new elementary schools, $25 million for a new public safety indoor firing range, $15.4 million for a 50-meter pool addition to Chinquapin Park Recreation Center and Aquatics Facility, $15 million for waterfront parks, $10 million for more local buses, $8.2 million for open space preservation and $4.3 for affordable housing.
Jinks said $30 million per year could be raised without additional borrowing by adding 5 more cents to the real estate tax rate, increasing the meal tax rate from 4 to 5 cents and boosting the personal property and business tax rates by 50 cents.
CORRECTION: A earlier version of this article misstated the increase foreseen in the capital improvement budget over the next 10 years. The amount has been corrected.