The city’s proposed $2.9 billion spending plan wants to keep up with the rising cost of government services while investing in the municipal workforce, infrastructure needs and providing some relief through personal property taxes.
That last point may be a source of discussion as the first of two public hearings is held Wednesday at the Virginia Beach Convention Center.
Amid rising assessments, which are projected to go up by 6% on average, the proposal includes tax relief through a credit of up to $80 on personal property taxes rather than by lowering the real estate tax rate.
The proposed credit of 10.1% would offer up to $80 savings per vehicle and apply to each personal vehicle a resident owns. The city estimates an average savings of $96 per residence.
The city’s real estate tax rate would remain at 97 cents per $100 of assessed value, meaning taxes go up as assessments do. Council members have said personal property tax relief helps a wider range of citizens, not just homeowners.
According to a presentation, the city has 495,000 personal vehicles compared to about 113,500 homeowners.
Public hearings on the budget are scheduled for 6 p.m., Wednesday, and 6 p.m., April 21, at City Hall. Council is scheduled to vote on the plan May 12.
The proposal for FY26-27 is nearly 3.3% larger than the current budget.
Last month, Kevin Chatellier, the city’s director of budget and management services, said the proposed budget took into account some form of tax relief while addressing city worker compensation, which would rise by about 3.5%, and infrastructure.
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- Budget increases include the continued five-year process of raising public utility fees.
- New changes would include two waste management fee increases. The cost of replacing a refuse container would rise from $75 to $100. Yard debris container rentals would rise from $40 to $50 per day during the week and from $75 to $150 for a weekend rental.
- The proposal also includes higher fees for some parks and recreation programs, including some memberships, facility usage costs and some services.
- The plan maintains capital projects that are underway, adds funding for new projects and directs more money to maintenance of city buildings. It includes $330.4 million for Princess Anne High School construction in 2028. And full funding is proposed to renovate Great Neck Recreation Center and design for the Bayside and Princess Anne recreation center renovations. The budget also increases funding for a backlog of needs at the municipal center and other locations.
- In addition to the 3.5% general increase for all positions, which would start in July, the proposed budget includes a reserve of $7.5 million for targeted increases in January to make pay in the workforce more competitive.
During a meeting last month, Councilmember Stacy Cummings said he appreciated the proposal, including the personal property tax relief idea, though he hasn’t “acquiesced” on lowering the real estate tax rate.
Vice Mayor Rosemary Wilson said the city wanted the credit in place for at least two years. Chatellier said the personal property tax credit is sustainable and could stay in place. Staff would seek directions from the council should that change.
The city anticipates lower costs for the Virginia Retirement System and higher anticipated real estate tax revenue because of the expected 6% growth in assessments, Chatellier said.
He added that real estate tax revenue is affected by tax relief programs, including increasing enrollment in a state-mandated program for disabled veterans and surviving spouses and growth in a local program for elderly residents. That means exemptions totaling about $46 million and $16.6 million, respectively.