Richardson proposes four cent real estate tax increase for Albemarle’s FY26 budget with most of that revenue going to cover fire and EMS personnel

For the first time in several years, Albemarle County Executive Jeffrey Richardson is recommending a budget based on an increase in the real property tax rate.

“The budget is balanced on a tax rate of recommended tax rate of 89.4 cents, which is a 4 cent dedicated property, real property tax increase,” Richardson said.

The proposed title for the recommended budget is “Investment in Action – Prioritizing our Community’s Safety and Well-Being.” (download the full budget here) (view the presentation)

Richardson is also recommending returning the personal property tax rate to the pre-pandemic level of $4.28 per $100 of assessed value. The meals tax is anticipated to stay at six percent and the lodging tax is anticipated to remain at nine percent.

The total budget of $642,386,163 is just under two hundred thousand dollars larger than the adopted budget for FY25 of $642,196,101.

The increase in the real estate property tax comes in a year when Albemarle’s property reassessment resulted in an average value increase of 5.1 percent. An equalized rate is not presented within the 318 page budget document, but the amount is $0.813 per $100 of assessed value. The equalized tax rate is the one that bring in the same amount of real property tax revenue as in the previous fiscal year.

During his hour-long presentation, Richardson explained how county staff use a five-year financial plan to guide budget development each year. That process had identified a gap that would need to be closed this year, and so that is his recommendation.

Of the four cents, 3.2 cents will be dedicated to cover costs of a long-term plan that has hired 57 additional firefighters and medics in recent years to increase response teams across the county’s rural and urban area.

“Four years ago we knew that we faced the inevitability of a real property tax increase at some point in time,” Richardson told the Board of Supervisors Wednesday afternoon. “We had stronger than anticipated natural revenue growth combined with success in competitively earning federal SAFER grant money that we pulled down from the federal government that when you combine those two things, it delayed the inevitability of a tax rate increase.”

SAFER is an acronym for a Federal Emergency Management Agency grant that Albemarle and other localities across the country have used to hire additional public safety personnel. Under the program, the federal share is gradually reduced until the locality has to pick up the full tab.

“The four SAFER grants that we pulled down through the federal government totaled $12.7 million,” Richardson said. “And you’re going to hear me talk about that today because it’s time now, as those grants feather away, for the local government to step in and to take that burden over.

The four cent increase includes 4/10ths of a cent dedicated to the public school system. In recent years, the county has also made a commitment to capital construction such as two new public schools.

“We’ll need additional operating revenue in order to make that work,” Richardson said.

The remaining 0.04 cents will go to affordable housing programs, generating $1.2 million.

There will be a public hearing on the recommended budget and capital improvement program on March 5. That will be followed by a series of work sessions before another public hearing on April 30 on the tax rates. The Board is scheduled to adopt the budget on May 7.

More details on the budget

There is funding to hire six additional police officers, the most to be added in one year since FY2016. Richardson said 13 officers have been hired since FY2021. A consultant has been hired to to study appropriate staffing levels, but that won’t be completed until the end of the calendar year. 

“Investments in police will also continue efforts to modernize the department, making it easier to recruit and to provide better service in response to the community,” Richardson said. 

Albemarle County relies on nonprofit groups to assist in the provision provide social services and this budget has $1.6 million that will go toward 26 of them. Details can be seen on page 81 of the budget. 

“That $1.6 million does not go very far. But it is significant in this budget that we’ve been able to allocate funding in the recommended budget to increase the total amount by $385,000,” Richardson said. 

Some highlights: 

• There is $38,700 for Loaves and Fishes, an food security organization that has previously not received direct funding. 
• The amount for PACEM has been increased from $710 in FY25 to $116,250 in FY26. 
• There’s $75,000 for Project Safe Neighborhoods , a $25,000 increase from FY2025. Charlottesville City Council got a briefing in early February, as I reported at the time.
• The amount for ReadyKids increased from $77,187 to $194,391. 
• No funding is recommended for either Computers4Kids or Light House Studio. 
• The Albemarle Housing Improvement Program’s Septic to Sewer program will receive $350,000. From a story I wrote last September, this program was set up in FY23 when Albemarle Supervisors appropriated $1 million to assist property owners on failing septic systems in the urban area with connections to public sewer.  
• Albemarle will pay the City of Charlottesville’s Department of Human Services $60,000, up from $50,000 in the current year. 
• The United Way Childcare Scholarship Program will receive $211,000, an additional $50,000 from the current fiscal year. 

Richardson also described the $35 million that goes to partner agencies who provide services. This includes the Albemarle Charlottesville Regional Jail which is soon to be renovated with some of the capital funds coming from the county. 

“For the first time in 50 years, the county will share the debt service that goes to the renovations at that regional jail,” Richardson said. 

The county’s payment to the Charlottesville-Albemarle Society Prevention of Cruelty to Animals will increase by 47.4 percent to $1,185,303. 

This is the first budget to be unveiled after Albemarle County agreed to join Charlottesville in forming a regional transit authority. 

• The amount paid to the Central Shenandoah Planning District Commission for the Afton Express increases from $1,965 to $6,286. 
• While the amount paid to Charlottesville Area Transit remains flat at $1,859,184, there is a separate line item of $1 million for a contingency fund
• Albemarle’s payment for the MicroCAT program increases from $441,887 to $1.3 million now that a state grant has expired
• A contribution of $26,750 will be made to the Charlottesville Albemarle Regional Transit Authority. 

The total amount of funding for affordable housing programs is $4.2 million. That includes $3 million in “one-time money” that would go to the county’s housing fund, plus another $1.2 million generated by a portion of the additional revenue to be generated by a real property tax rate increase.

“The county continues to invest in developer incentives and other initiatives to expand affordable housing options,” Richardson said. “Efforts focus on increasing the supply of affordable homes and rental units, supporting workforce housing and assisting residents in securing stable housing.” 

Richardson there’s been a total of $17.7 million in funding from Albemarle for affordable housing from FY21 to FY24. 

One item worth acknowledging is a transfer of $985,165 from the FY25 budget to the “economic development opportunity fund” but not until after the FY26 budget is adopted. 

“It’s about us having money on hand and available to deploy to make the right partnerships, the right investments to strengthen the economy and take advantage of the right opportunities as they come along,” Richardson said. 

County employees will get a three percent cost pay increase and public safety officers will get an additional two percent. Richardson said the budget does eliminate about 12 positions.

Albemarle will continue to build up its own internal health care system for employees to try to bring down costs. One clinic is now open on Pantops and another is scheduled to open later this year. 

“Investing in the clinic will help to control our health care costs,” Richardson said. “Nationally right now, health care inflation is a huge issue, but maybe even a bigger issue is access to health care.” 

The capital improvement plan for FY26 is recommended at $58,770,320. The total for the five year CIP is $322,655,344. When Supervisors adopt the budget, only the first year of the CIP is appropriated but figures presented in the “out years” send a signal of what the county expects to do. 

• There’s an additional payment of just over $3.5 million for more work at Biscuit Run. There’s no additional funding in the out years. 
• Those interested in transportation projects should note the CIP includes a lump payment to something called the Transportation Leveraging Program. This is $9,843,035 for FY26. 
• There is $1.5 million for an urban pocket park. 
• A final payment of $7.5 million is included for the renovation and addition to Albemarle’s court facilities in downtown Charlottesville. 
• There’s a $40,000 capital payment to Loaves and Fishes.
• The total debt service Albemarle will make will increase 25.2 percent to $14,731,280. In FY2024 the payment was $9,278,375.

The revenue-sharing payment to Charlottesville will cross the $20 million mark for the first time, up 13.6 percent from FY2025 to a total of $20,175,533. 

Supervisors will have up to eight work sessions, but they had the opportunity to make comments after Richardson concluded his presentation. 

Supervisor Ned Gallaway wanted to know why staff feels there is a need to hire the six police officers this year. He suggested finding a way to tie the additional resources to the strate gic plan.

“I think that’s going to be helpful in a lot of different areas as we go through this budget, especially for community members who are asking, you know, anytime there’s a tax increase that, you know, where’s the money going?” Gallaway said. 

Supervisor Ann Mallek noted a comment Richardson had made about seeking to diversify the county’s tax revenue by promoting economic development. But she added that if that brings in more people, the county’s spending needs will also increase.

“The unanswered part of that is the benefit to residential taxpayers only happens if we’re able to control the expenditures,” Mallek said. “ In other words, we’re not going to be able to reduce that burden. If we continue to go up with our expenditures and as population growth continues to happen and make everything cost more, that’s going to be a big challenge going forward.”

Supervisor Michael Pruitt noted that the March 19 work session is the one where elected officials have to decide whether they want to have a higher real property tax rate. He urged members of the public who would like the Board to consider additional spending to make their views known as soon as possible. 

“Realistically, people try and jump in during April, jump in during May, and realistically, we have very little wiggle room after we’ve advertised that tax rate,” Pruitt said. 

Pruitt said he wants to support the provision of $10 million a year to the affordable housing trust as requested by a coalition of dozens of groups. Take a look at my report from earlier this month. 

Supervisor Diantha McKeel pointed out that there is a structural reason why the county has been seeking to increase the number of professional firefighters. 

“I think it’s important for the community to remember that we have volunteer firefighters that are going away because they’re aging out,” McKeel said. 

Richardson said elected officials last year were shown demographic data on volunteers that showed many rural stations were staffed by people over the age of 65. 

“We’ve been successful four times in a row in order to be able to pull federal dollars in $12.7 million over four [Federal Emergency Management Agency] SAFER grants to supplant the loss of volunteer services with 57 firefighters that have been spread through the county, both in urban and rural areas to help to better cover the gaps,” Richardson said. 

Now those grants are expiring and if the county wants to keep the firefighter in place, Albemarle has to pick up the tab. For more of the backstory, take a look at a story I wrote in January 2024 when only three SAFER grants had been awarded.  

McKeel also said she will want to have discussion about the potential impact a reduction in federal funding could affect transit. Richardson said the budget staff is closely monitoring the situation but overall federal funding makes up two percent of the county’s budget, or $9 million. He also noted that the county has a budget stabilization reserve that is currently just above that amount. 

“That could be in a time where we pass the budget and then realize that we’re going to lose money that could buy us time with that stabilisation money to not have such a dramatic effect until this board and staff figures out what we do long term.

One decision about Albemarle’s budgetary future could be up to Governor Glenn Youngkin and whether he will sign legislation to allow localiites to hold a referendum on a one-cent sales tax that would go entirely to school construction. SB1307 passed the Senate on a 27 to 12 vote and the House of Delegates on a 62 to 33 vote. 

“That $0.01 for the county equates to $25 million a year,” Richardson said. “And that $25 million is captured off of a dedicated $0.01 sales tax that’s captured from economic sales activity in this community.” 

Youngkin vetoed last year’s version of the bill and issued a lengthy explanation why.

“The Commonwealth should pursue a tax policy that unleashes economic development and prioritizes job and wage growth through innovative reforms,” reads the statement. “These reforms must allow hardworking Virginians to keep more of their money, not less; any proposal that increases the cost of living and the cost of business is not a policy we should pursue.”

More on the budget as we come closer to the eight work sessions and multiple town hall meetings.

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