Charlottesville City Council members are debating a proposed 7 percent increase in this year's budget in response to continued cuts in state reimbursements to local governments.
The proposed $100 million budget is a $7 million increase from last year.
While Council has not proposed any new programs or any increases in programs already in existence, the City must make up the difference for a lack of funding from the state government.
"The increase in our budget picks up where the state left off," Council member Blake Caravati said.
This year's City budget must accommodate a $2 million decrease in state reimbursements for local public schools and a $700,000 decrease for local jails. The City must also bear the burden of decreases in state reimbursements to the local government for juvenile detention facilities and salaries of police and constitutional officers including the Commonwealth attorney and treasurer.
The City also is encountering growing responsibility for comprehensive services, such as foster care. Under the Comprehensive Services Act, the state is responsible for funding 70 percent of such services. The City's contributions to such services have increased by $200,000 annually in the past five years, according to Caravati.
In addition to adjusting to growing inadequacies in reimbursements from the Commonwealth, the City also is faced with standard local concerns, such as environmental costs associated with the City's landfill.
"There is no question that the state budget is having a negative impact on local governments, especially in cities like Charlottesville, with such a diverse socioeconomic population," City Spokesperson Maurice Jones said.
City officials have proposed a variety of tax increases in order to fund the $7 million rise in this year's budget. The proposals include a 13 percent increase in cigarette tax, an increase from $1 to $3 in the fee on each local telephone line for 911 services and a five percent increase on the trash stickers required locally.
In addition, the City is expecting a $3 million increase in revenue from real estate taxes due to this year's 10.7 percent increase in real estate assessments, Caravati said.
The assessments, required by the state yearly, are based on the market and property values of local residences and determine real estate taxes, which are currently $1.09 for every $100 of property value, Jones said.
While the 10.7 percent increase does indicate a positive trend in local property value, the subsequent increase in real estate taxes is likely to place a burden on citizens with fixed incomes, Jones said.
"A rise in assessments typically affects people with fixed incomes," Jones said. "Their incomes remain the same, yet they are being hit by increases in real estate taxes."
In an effort to lessen the tax burden on citizens with fixed incomes, especially seniors and the disabled, the City provides tax relief programs, Jones said.
Since Council will not officially approve the budget until April 15, the Council may consider cuts in the current proposed budget in order to boost the tax relief programs, Caravati said.
"As difficult as this year's budget might seem, it is important to realize that Charlottesville is in much better shape than other cities around the state that are having to increase taxes and cut services," Jones said. "In Charlottesville, we are still working to maintain the high quality of services available to citizens."
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