Next Budget Process In Alexandria Approaches After Outlook Shows Budget Gap

ALEXANDRIA, VA — City residents will get the first look at proposed city budget funding and tax rates in late February.

The City of Alexandria has announced its timeline for the fiscal year 2026 budget process. It will kick off with City Manager James Parajon presenting a budget proposal at 7 p.m. on Feb. 25 in the Council Chambers at City Hall. A public presentation of the budget will follow at 7 p.m. on Feb. 27, with the chance for residents to get an overview and ask questions.

A preliminary budget forecast presented during a late November budget retreat estimated an $18.3 million budget gap due to $953.1 million in spending outpacing $934.8 million in expected revenues. The presentation indicated budget cuts or revenue increases would be needed to address the gap.

The previous City Council approved budget guidance following the budget retreat. The guidance calls for limiting operating budget growth to 2 percent, with the flexibility to increase the real estate tax rate if revenue growth cannot support a 2 percent budget increase. The city manager is also tasked with finding cost-saving measures of 1 percent and considering reduction of services when services are beyond community needs or have not met intended goals. For Alexandria City Public Schools, the guidance recommends an increase limited to 2 percent for the operating budget transfer from the city.

Last year's approved operating budget totaled $926.4 million and was a 4.8 percent increase over the previous budget. City Council opted to increase the real estate tax rate from $1.11 to $1.135 per $100 of assessed value, which resulted in an average $483 increase for single-family homeowners and $285 increase for condominium owners.

According to the budget outlook, the city expects residential assessment value increases to be similar to the last year — 3 to 4 percent increases. City Council typically receives data on property assessment changes before the budget proposal. Assessment values and the real estate tax rate set in the budget process will determine property owners' tax bills.

Key dates on the upcoming budget calendar are:

• Feb. 25: City Manager's Fiscal Year 2026 Proposed Budget Presentation
• Feb. 26: Budget Work Session #1 -City & ACPS Capital Improvement Programs
• Feb. 27: Public Presentation of Fiscal Year 2026 Proposed Budget
• March 5: Budget Work Session #2- City Council/School Board
• March 10: City Council Public Hearing: Fiscal Year 2026 Budget
• March 11: Fiscal Year 2026 Budget Set Maximum Tax Rate
• March 12:- Budget Work Session #3 (TBD)
• March 15: City Council Public Hearing Meeting - Fiscal Year 2026 Budget Public Hearing
• March 19: Budget Work Session #4 (TBD)
• March 26: Budget Work Session #5 (TBD)
• April 8: City Council Public Hearing Meeting - Fiscal Year 2026 Budget Add/Delete Public Hearing
• April 22: Budget Work Session #6-Preliminary Add/Delete
• April 28: Budget Work Session #7-Final Add/Delete (if needed)
• April 30: Fiscal Year 2026 Budget Adoption/Tax Rate Adoption

Stay up to date when the budget process begins at www.alexandriava.gov/Budget.