Anyone who would like to make a public comment about Charlottesville’s proposed budget for FY27 or a proposed increase in the real property tax rate has one last chance tonight to do so.
According to the staff report, City Council will hold a public hearing on the $280,553,920 document that describes revenues Charlottesville is projected to bring in and what expenditures are expected to be made. That amount is $910,522 higher than what it was the last time an informal public hearing was held on the tax rate on March 16.
“This amount represents the estimated account balances below that are projected to remain unspent as of June 30, 2026, and will be authorized for expenditure during FY 2027,” reads the staff report for the April 6 meeting.
However, that information is out of date as you will learn in this article.
A series of work sessions
Since March 16, City Council has held three additional meetings specifically on the budget as well as a fourth on preliminary costs to upfit an office building at 2000 Holiday Drive to serve as a low-barrier shelter for the unhoused.
Of those four, I’ve only had the opportunity to cover the March 25 work session on the shelter. So, with that spirit, a quick summary of budget work sessions from March 19, March 26, and April 2. To my knowledge, no other journalistic enterprise has covered these and I lament it took me until the final day to get these produced.
There was also a work session on March 12 but for the purposes of this exercise I am going to skip this one due to time constraints.
Council entertains idea of limiting tax rate increase to one penny at March 19 work session
Tonight’s public hearing on the budget is the official one but an informal one was held on March 19 as part of what was billed as the Community Budget Forum. The only speaker was Jim Moore who said he has eight rental properties within Charlottesville.
“I tend to try to keep my rents a little below market, and I have some tenants that really can’t afford much more than that,” Moore said.
Moore said one of his units has increased in property value by 74 percent from 2021 to 2025. He asked for the city to lower the anticipated rate increase.
The budget forum ended up being more like a work session with staff presenting information to the City Councilors on potential ways to lower the rate. But first, budget director Krisy Hammill explained why the two cent real property rate increase had been proposed.
“Most of the new revenue for the tax increase was put in the budget to offset the deeper transit investments, the increased match for the schools, and also the impacts of collective bargaining,” Hammill said.
That two cent tax increase generates $2,467,724 a year.
Hammill showed information showing slightly higher revenue forecasts anticipating an additional million and also showed including less funding for Charlottesville Area Transit, the use of a reserve fund, and eliminating funds for Council Strategic Initiatives.
“One other option would be to move the schools back to the original 2 million that we had originally built the budget around, thus reducing their increase by $569,000,” Hammill said.
The budget anticipates hiring ten additional drivers for Charlottesville Area Transit. Under this scenario, money would be in place to hire five in July and the other five would be hired in January as well as additional mechanics and supervisors. That might also mean scheduled service improvements might be delayed.
City Manager Sam Sanders said this would defer spending and Council would have to build positions into next year’s budget. That would create a structural imbalance that would have to be addressed.
“Any creation of a structural imbalance is a risk,” Sanders said. “The question is how much of a risk are you willing to take. When you create the imbalance this year and solve it this way next year, you’re saying that your reassessment should be higher to start with. And you can’t guarantee that.”
Councilor Jen Fleisher said she liked the idea of limiting the real property tax rate increase to a penny as a middle ground option.
Councilor Natalie Oschrin said the tax rate increase should proceed at least one cent.
“I appreciate coming up with the CAT adjustment scenario to try and make it fit,” Oschrin said. “I would prefer not to do that since it just kind of kicks the can down the road a little bit.”
Oschrin said she could support using the reserve and eliminating additional funding for Council’s strategic initiatives.
Councilor Michael Payne said he could support a one penny tax rate increase but said the risk to split funding for CAT personnel would be too high.
“I don’t like in the past when we’ve set ourselves up with kind of fiscal cliffs,” Payne said.
Mayor Juandiego Wade also said he could support a penny increase.
“I appreciate the work that I’ve done to kind of bring back because we’ve been hearing from residents about the, the cost of living, the, the tax increase and this I believe is a good, won’t satisfy everyone,” Wade said. “But I think it’s a good, good compromise if we decide to go in this direction.”
Two people did speak after the Council wrapped up their discussion but it is time to move on to the next meeting.
Councilor Lloyd Snook was absent from the meeting.
Resources for this meeting:
No decisions on tax rate at March 26 CIP work session
The March 26 work session dealt with the Capital Improvement Program. That’s the portion of the budget that sets out what a locality expects to spend on infrastructure over the next five years.
“The CIP plan for 27 is just over $47 million with $196 million over the five years,” Hammill said. “If we were to look in terms of dollars spent, education is the highest in this plan, followed by transportation and access, and then affordable housing coming in third.”
There were no major changes in this year’s CIP. The Charlottesville Planning Commission had a work session on the capital budget in late November and later had a public hearing in December.
- Charlottesville PC takes first look at draft Capital Improvement Program, December 2, 2025
- Charlottesville Planning Commission seeks some changes to city’s five year CIP, December 19, 2025
The five-year CIP currently includes $50,000 a year for a line item called Parks and Master Plan Implementation. Sanders said that number will increase in the years to come because the master plan adopted by Council in March 2025 had a $78 million price tag.
“We know that those numbers need to be dramatically different if we’re going to come anywhere close to that,” Sanders said. “But we now have an assistant city manager here who’s going to be working with the team to try to figure out how do we allocate better over the next five year cycle.”
Part of the plan calls for major changes to Market Street Park, Court Square Park, Washington Park, and Tonsler Park. Sanders said each will be expensive and staff still needs to work out the timing.
Parks and Recreation Director Riaan Anthony said the department will seek grants in addition to tax dollars to pay for the various projects.
“In order for us to get there, we have to right size our department and the city,” Anthony said. “We are working in partnership with Public Works, reaching out to their department to say hey, do you have any resources?”
There was further discussion of the parks and recreation master plan at the April 6 City Council work session.
At the March 26 there was a further discussion on the possibility of a one cent sales tax increase, what to do with anticipated payment-in-lieu fees for student housing projects, as well as miscellaneous discussions.
Toward the end, Sanders hit reset on the discussion of the tax rate. On March 19, there appeared to be consensus to limit the increase to a penny but Council still had to make decisions.
“We’re looking for you to finalize what scenario we are actually going with for offsetting, for addressing the fact that you’re stepping back from two cent increase on the real estate tax to a one cent increase on the real estate tax,” Sanders said.
However, that discussion did not happen. Instead, Councilors opted to send suggestions to Sanders via email on how to offset the funding if they wanted to proceed.
Resources for this meeting:
Councilors agree to limit real estate tax rate increase to a penny for 2026
There were no prepared materials for the April 2 budget work session billed as a wrap-up session.
“The items that are open for discussion that we’re looking for answers on is closing out the review of the Vibrant Community Fund process and how Council is looking to utilize your Strategic Initiatives fund,” Sanders said.
The Vibrant Community Fund process had been covered at the March 12 work session. This is how nonprofit organizations seek funding from Charlottesville. The full report can be seen here.
Mayor Wade wanted to make sure everyone was on the same page regarding the penny increase on the real estate tax rate.
“We had initially looked at a two cent tax increase, but we saw options where we could do one,” Wade said. “And I just want to make sure if you, if we have that information we can bring them make sure everyone’s on the same page with that. And if I can get a head nod or yes from everyone as we go down the line, make sure we are all okay with that.”
As the meeting began, Council had a $228,000 gap to fill if they wanted to go with a penny increase. Hammill displayed the math on a spreadsheet, a spreadsheet made available to the public after I asked for it.
However, the staff report for today’s public hearings on the budget make no reference to this agreement.
“The FY 2027 Proposed Budget includes a $0.02 increase to the real estate tax rate, raising it from $0.98 to $1.00 per $100 of assessed value,” reads the staff reports dated April 6 but posted before the April 2 work session.
The city has since confirmed that the staff report is incorrect.
A question is out to confirm which is the correct information. As I conclude today’s edition, I make the editorial decision that what I heard on tape and what is in the spreadsheet is what matters and have just asked if the incorrect staff report affects the ability of Council to hold a second reading on April 9.
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