Falls Church City Manager Wyatt Shields presented his recommended FY17 budget to the F.C. City Council Monday night calling for a 2.5-cent real estate tax increase and a total budget of $87,345,420, an increase of 5.1 percent over the current year, that includes, as required by law, the full School Board request. It now awaits City Council action that will culminate with the budget’s final adoption on April 26.
Shields’ proposed budget calls for a 1.2 percent ($438,421) increase in the general government operating fund and a 5.4 percent ($2,065,130) increase in local funding for the schools.
Shields set his budget proposal in the context of a number of strong developments in the City, including new private investment, in which three new large scale mixed-use projects have contributed five percent of the City’s total added value on only six acres, a “growing and vibrant city” with 10 percent population growth between 2010 and 2013, new projects underway, including new public safety, park and stormwater improvements, investment in new public facilities, and a commitment to service.
He said despite major investments in capital improvements that are coming up the pike, including a new high school at above $100 million, the City will stay within the parameters of its fund balance and debt policy guidelines and enjoys a much stronger position with its pension plan, prospects for continued robust economic growth and strong financial management from the City staff and City Council.
The budget calls for no new positions in the city government in the coming year, while retaining the new positions added last year and projecting four new police officer and two new dispatcher positions for the near future. Employee compensation will involve a three percent merit increase and three percent step increase for police officers, and covering premium increases for health insurance.
Calling for a two-cent real estate tax rate hike to $1.34 per $100 assessed valuation, Shields also called for a 16-cent increase in the personal property tax (the car tax) for transportation and an increase of ten cents in the cigarette tax also for transportation.
While real estate assessed values barely grew in the last year, a trend experienced throughout the region, they were offset by the boom in the contribution of new mixed-use projects (the Lincoln at Tinner Hill, the 301 W. Broad and the Kensington) to ameliorate the pressure on residential taxpayers.
Shields noted that even with the two-cent increase, the City’s tax rate falls in the middle of the list of jurisdictions in the region, and cited the example presented by former Council member Kieran Sharpe that Fairfax County, for example, hides a lot of the taxes it imposes by separating them out as separate costs from the core real estate tax rate. Commercial properties in Tysons Corner, he noted, pay a total tax rate of $1.491, far above the county’s base tax rate of $1.13 and the proposed rate for Falls Church of $1.34.
Presenting the School Board’s requested transfer from the City, Board Chair Justin Castillo cited the continued trend of record enrollment growth that has taken the system from 1,874 students in the 2006-07 school year to 2,600 projected for the coming school year, an increase of 729 students.
The growth has required nine new teacher positions and salary increases averaged out to two percent in order to bring the system’s teacher salary levels within three to five percent of neighboring Arlington. Mandates have added another $650,000 in costs to account for the 5.4 percent overall budget increase to $48.6 million.
The Capital Improvement Program (CIP) in the budget contains significant projects totalling $112 million, and the subsequent four year planning period for a five year total of $128 million. Projects include the high school and middle school, improvements for Big Chimney Park, Cherry Hill Park and Herman Stream Valley Park, and fire station improvements. Two new projects are the downtown West Broad Street Plaza and funding for land acquisition.
Transportation projects totaling about $6 million are largely grant funded, and include Oak Street and Sherrow Avenue bridge repairs, Roosevelt Boulevard roadbed reconstruction, intersection improvements, and bicycle and pedestrian improvements.
Shields recommended to the Council that it advertise a tax rate increase to $1.36 per $100 assessed valuation at its next work session to give it options for flexibility. This is a standard practice, and does not alter his recommendation for $1.34.
A public open house and town hall on the budget recommendations will be held at the Community Center this Saturday at 10 a.m., and there will be three public hearings on the budget beginning March 28 and a second town hall meeting on April 9. The City Council will finalize the budget on April 26.