Fairfax board eyes lower-than-proposed real estate tax hike amid budget constraints

Real estate taxes will likely go up for Fairfax County homeowners in the coming year, but perhaps not by as much as they could.

The Board of Supervisors plans to approve a 3-cent tax rate increase, down from the four cents that was advertised. That will reduce the average tax bill hike from about $524 to just over $450.

While additional funding is proposed for affordable housing, public libraries and parks, the county’s fiscal year 2025 budget won’t satisfy Fairfax County Public Schools’ full funding requests or include the pay levels sought by county employees.

An initial draft of the county’s FY 2025 budget markup suggests setting a real estate tax rate of $1.125 per $100 of assessed value, a 3-cent increase from the current rate of $1.095 per $100.

During a budget committee meeting on Friday (April 26), board members argued that the tax rate increase is necessary due to a revenue shortfall from a sluggish commercial sector and reduced state funding.

“Our current situation is not sustainable, and we can already imagine what’s going to happen in the next tax year as it relates to commercial office and particularly the elevator office,” Franconia District Supervisor Rodney Lusk said.

As a result, the county is unlikely to increase the market rate adjustment (MRA) for county employees beyond the 2% proposed by County Executive Bryan Hill.

According to the markup draft, general county employees are set to receive an average salary increase of 3.25% to 6%, effective July 1, including the 2% MRA, pay scale adjustments and increases for performance and length of service. Deputy sheriffs will, on average, receive an increase of 7.85% in FY 2025.

The county also proposes allocating only $165 million of the $254 million requested by FCPS Superintendent Dr. Michelle Reid — nearly all of which would be used to fund teacher and personnel pay raises.

That will still be nearly 7% more in funding than what the school system got last year. The supervisors expressed hope it will cover Reid’s proposed 6% salary increase for all school employees, but their optimism hinges on the state providing additional money to fill any remaining financial gaps.

Board members raised concerns over the state’s chronic underfunding of public schools, which costs FCPS $345 million annually, according to a recent study by the Joint Legislative Audit and Review Commission of Virginia. That could be compounded by budget cuts proposed by Gov. Glenn Youngkin.

State funding cuts force local governments — which derive most revenue from real estate taxes — to place a heavier tax burden on homeowners, who end up footing the bill to make up the difference, supervisors said.

Looking to the future, they urged the school board to seek funding more in line with the county’s projected revenue to ensure it can fulfill the request.

“I think it’s worth reminding people who are watching that over 89% of FCPS budget expenditures go to compensation,” Board Chairman Jeff McKay said. “So, this is not an insignificant thing we’re talking about. If you have 89% of your budget going to something, you should be studying that ad nauseam and making sure that every dollar that’s going there is targeted to the people that need it most to be able to properly stay in market.”

The board acknowledged a need to diversify the county’s revenue sources but stopped short of suggesting specific solutions.

Springfield District Supervisor Pat Herrity argued that the rising burden of real estate taxes is driving out residents.

“From budget testimony calls and emails to my office, it’s clear our residents can’t handle another tax increase,” he said. “I mean, it’s 56% in 10 years, and that’s because of budget increases. Census data clearly shows people are voting with their feet and leaving Fairfax County.”

Instead of doing an internal review, Herrity called for an independent, third-party review of the county’s financial situation that could provide “hard facts.”

“As we’ve seen in the last two months, from when the county executive presents his budget in February to April, you can’t do the analysis you need to do,” he said.

Braddock District Supervisor James Walkinshaw countered Herrity’s claims about the county’s migration patterns, pointing to housing issues as the fundamental cause.

“They want to be here in Fairfax County,” Walkinshaw said. “We have great schools, a strong economy, and they want to be here. They need housing in order to be here.”

At a mark-up session tomorrow (Tuesday), the board will consider allocating $4 million to support affordable housing initiatives, per the draft. Since setting a goal in 2022 to build 10,000 units by 2034, the county has already created or has plans to build approximately 4,000 affordable housing units.

Additionally, the board intends to set aside a total of $1 million for Fairfax County Public Library’s materials collection, pickleball courts at Wakefield Park, the Women’s Center relocation and construction of the Eileen Garnett Civic space in Annandale.