Fredericksburg residents and businesses will see increases in their bills for real estate taxes and a number of fees beginning July 1.
The City Council on Tuesday unanimously approved a revised general fund budget of nearly $100.2 million for fiscal year 2020. That’s an increase of $4.1 million, or 4.29 percent, over the current budget. It includes a real estate tax rate of 85 cents per $100 of assessed value, which is a nickel increase over the current rate.
The real estate tax rate increase, which also passed unanimously, means that residents with a home valued at $250,000 will see an annual increase of $125. A commercial property valued at $2 million will see an increase of $1,000 for the year.
The new tax rate is a penny higher than City Manager Tim Baroody had requested, but a penny less than the 86-cent rate advertised before the public hearing. The additional cent, which equals $400,000 in total revenue, is intended to be used to give teachers and staff a 5 percent raise.
City Council member Kerry Devine said while the council doesn’t have line-item oversight of the School Board’s budget, it is council’s desire that a portion of the revenue from the tax increase be used for raises.
School Board member Jennifer Boyd had stressed at the meeting that the city’s school system would be at a “significant disadvantage” if its teachers weren’t given a pay raise and other school systems did, especially since there is a teacher shortage in Virginia and the nation. She said that Fredericksburg’s starting salary for teachers is in the middle of the pack for this area, but the city has an advantage over its neighbors when it comes to the pay offered to teachers from mid-career to the top of the salary tier.
Superintendent David Melton told the School Board during its meeting Monday that the additional funds will allow the board to give teachers and staff the raise, even though the $1.4 million in additional funding the city will now provide still falls short of the $2.12 million requested. He said that health insurance costs turned out to be less than anticipated, and there will be payroll savings due to retirements and employee attrition.
“I just want to acknowledge, since I’ve been on the board, this year working with City Council has been the best,” said Malvina Kaye, who chairs the School Board and is a longtime member.
City Council also approved increases in the water, sewer, trash and recycling collection rates next fiscal year, as well as changes to the city’s Elderly and Disabled Tax Relief program so more residents would be eligible. Increases in building fees along with adjustments and increases to planning fees were also included.
Here’s a breakdown:
- Water and sewer fees will increase 10 percent to cover operating costs, debt service and future capital needs. Median water and sewer users, defined as those using 6,700 gallons of water every two months, will see their total two-month water and sewer bill jump from $81.52 to a proposed $89.66 in fiscal 2020. That’s still lower than Stafford, Spotsylvania and Prince William counties.
- Residents who use the city’s trash and recycling collection services could also see their bills go up 10 percent. The last time those fees were raised was in 2015. The increase this time is for several reasons, including the Rappahannock Regional Solid Waste Management Board’s increase in tipping fees to the regional landfill.
- Planning Division fees will increase for such things as zoning and land use applications, plan reviews and land disturbance permits. A major change is that the land disturbance permits will be paid when the permit is issued instead of upfront during the review phase.
- The Building Division has increased its fees for new residential construction by 8 cents per square foot, to 40 cents; and 5 cents per square foot on residential alterations and renovations to 20 cents.
- Payment in lieu of providing an on-site parking space in the Downtown Parking District will go from $6,500 per space to $7,150 per space. T
- The asset limit for the city’s Elderly and Disabled Tax Relief program will increase from $200,000 to $300,000, and the total amount of available relief would increase from $1,000 to $1,500. Fredericksburg last amended the program in 2007.
In other business, City Council gave final approval to a new tax classification for data centers of $1.25 per $100 of assessed valuation of business property. Other localities have approved the same rate in a regional effort to attract data centers, which generate high-quality, high-paying jobs, and don’t require a lot of support services such as roads and schools.