There are just under four weeks until Charlottesville City Manager Sam Sanders presents his recommended budget for fiscal year 2027. The five people who will make changes and then adopt their version got a briefing on where things stand on January 29, 2026.
A key piece of information needed for the development of Charlottesville’s next budget is now in place.
“The city saw an overall increase from the previous year of 3.72 percent,” said David Milton, the city’s assessor. “For residential properties increased at a rate of 4.2 percent and commercial properties had an increase of 2.14 percent over the previous year.”
The increase is the second lowest in ten years with 2021 being the lowest.
The median assessed home price in Charlottesville rose four percent to a figure of $548,000.
With these calculations, Charlottesville’s real property tax base has increased from $8,417,260,600 in 2021 to $12,205,595,300. If those numbers are too big, we can also describe them as around $8.42 billion in 2021 to $12.2 billion this year.
That is a 45 percent increase in taxable value over five years.
If you want to appeal your assessment, the first step is to contact the City Assessor’s office at 434-970-3136 to talk to an appraiser. More details on the city’s website. The second step is to file an appeal and this will require documentation.
“This documentation must include the reasoning behind the appeal and evidence that the most recent assessment (1) exceeds true market value, (2) is substantially inequitable to similar properties within your neighborhood, or (3) is not equitable based on factual discrepancies within our records, such as difference in square footage, difference in acreage, or improvement condition,” reads the website.
The appraiser will then make a site visit and make a new determination. If the landowner disagrees, the third step is an appeal to the Board of Equalization. A fourth and final step would be to appeal to the Circuit Court.
Under Virginia law, budgets have to be balanced.
“I’ll be so much more excited to talk to you in March than tonight, because on the other end, we’ll be balanced,” said Krisy Hammill, the city’s budget director. “Right now, we’re not.”
Hammill told Council that forecast revenues for FY27 are $193,238,619, a nearly $7.2 million increase over the current budget.
Hammill currently said the bulk of the increase is due to the property tax assessment but added that meals and sales tax may be rebounding. The city will also receive $21.8 million from Albemarle County as part of the revenue-sharing agreement that dates back to the 1980’s.
Turning to expenditures, Hammill said that as of January 29, there is about $11 million in new revenue in the base budget for Council to recommend spending. That number may be adjusted as the city negotiates a new contract with the collective bargaining units representing police personnel. Council also has to consider whether to fully fund a request for $6.4 million in additional funding from the school system that is above what they would receive through existing formulas.
City Manager Sam Sanders brought up several potential affordable housing projects that have been mentioned at previous work sessions.
- Piedmont Housing Alliance has asked for an additional $3 million to build the fourth phase of Kindlewood to ensure the overall project can meet the original goal of a minimum of 425 units. The city would need to pay cash as the project would not be publicly-owned.
- Community Services Housing has asked for $900,000 for renovation of 40 existing units. Also would need to be in cash.
- Brick Lane Communities has asked for $1.75 million to help finance their project to convert the Holiday Inn on Emmet Street to 192 apartments for a mix of income ranges. Cash, also.
- Preservation of Affordable Housing seeks $3 million in financing to assist a project they are seeking to build at 1000 Wertland Street. Deputy City Manager James Freas has been working with POAH to gather more information.
Another potential bit of spending is $2.2 million in funding in FY27 to hire ten Charlottesville Area Transit drivers, five support positions, to keep the system fare-free, and to honor additional benefits required due to a collective bargaining contract. This would be the first phase of a four-year plan to gradually increase the number of drivers as I reported in December.
“Transit has been a conversation, a pretty hefty conversation for the past few years,” Sanders said. “The desire was for us to be able to realize in this budget this year a significant step forward, forward and in improving transit service for our region, for our community.”
Sanders said some of the $2.2 million would be covered by Albemarle County. This first phase would increase headways on Route 7 and the trolley-style bus route to every 15 minutes during weekdays.
Further discussion on the above will ensue.
Hammill wanted to get a sense of where Councilors stood on the current tax rates and whether they might want to change any of them. There will be a public hearing on March 16 on those rates and she needs to know by February 13 what they might be in order to deliver a balanced budget.
“In terms of any final decisions from you all, you still have until about the first part of March,” Hammill said. “But if this is something that you want to do and want built in as part of the budget, we sort of need an indication of that.”
- The current real property tax rate is $0.98 per $100 of assessed value and every penny brings in $1,233,862 in revenue
- The current meals tax rate is 7 percent and every additional percentage point brings in $3.23 million.
- The lodging tax is at nine percent and each point brings in $1,065,333.
- The personal property tax is at $4.40 per $100 of assessed value and every ten cents beings in $339,432.
Councilor Michael Payne said he wants to have flexibility during the budget process and would like to advertise rates accordingly.
“I think if we do pull any tax levers, I strongly believe none of them are perfect,” Payne said. “But it really should be real estate because that’s the one we’ve touched the least. And it’s our most progressive tax and we’ve leaned on our most regressive taxes that lower income families pay a disproportionate higher share of their income for those taxes.”
Councilor Lloyd Snook pointed out there is legislation in the General Assembly that would allow Charlottesville to tax improvements and property at different rates. HB282 from Delegate Katrina Callsen passed the House on January 27 on a 91-8 vote and awaits a vote in the Senate Finance and Appropriations Committee.
“This is not so much an issue for Chrissy when we talk about budget, but a matter of policy for us as to whether we think that that would be a good idea or a bad idea, whether it generate more revenue or less revenue, whether it would create an incentive in one direction or another direction,” Snook said.
More stories on the budget as we continue on throughout the winter.
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