Vienna residents’ next property tax bills won’t be quite as high as anticipated, even as the town commits to raising employee salaries and other additional costs.
The Vienna Town Council voted unanimously last night (Monday) to adopt a $48.7 million budget for fiscal year 2022-2023 with a real estate tax rate of 20.5 cents per $100 of assessed value — a 1.75-cent cut from the current rate. The new budget will be in effect from July 1 through June 30, 2023.
This will be the 10th consecutive year that the town has reduced or maintained its real estate tax rate, according to a news release.
With the average residential tax bill expected to increase 3.7% from last year due to rising assessment values, the council had urged staff to lower the tax rate beyond the 1-cent reduction initially proposed by Town Manager Mercury Payton.
“I think we did a good thing to help all residents in Vienna, but also, we were fiscally responsible,” Mayor Linda Colbert said after the vote. “We still have the rainy day fund and so on.”
Even with the increased tax cut, the adopted budget is 12.7% larger than the current spending plan, thanks to an “unusually large” surplus from fiscal year 2020-2021 and revenues bouncing back after two years of declines during the COVID-19 pandemic, according to town staff.
Parks and recreation fees have returned to pre-pandemic levels, jumping from $991,000 in fiscal year 2021-2022 to $1.1 million in the newly adopted budget, Director of Finance Marion Serfass told the town council.
The town also has also seen strong sales and meals tax revenues. The latter rose 23% to $3.2 million, according to budget documents, which attribute the increase to “easing pandemic conditions, creative solutions to restaurant dining including outdoor dining opportunities, and several new restaurants opening.”
The adopted budget includes a 4% salary increase for all eligible employees, on top of a 3% increase that was approved with last year’s surplus funds but deferred to the coming fiscal year. It also establishes a new, separate pay plan for the Vienna Police Department to “address challenges with officer recruitment and retention,” the town says.
In his overview for the budget, Payton noted that most town employees will see a 11.7% increase in health insurance premiums.
“The salary increase will assist employees in recovering those increases and also address inflation, wage pressure and employee retention concerns,” he wrote.
On top of the budget and real estate tax rate, the town council approved increases to the water and sewer rates of 2.6% and 3.8%, respectively. Fixed service charges will also go up by 4.8%, from $31.30 to $32.80 per quarter for most residential customers.
The average residential customer will see an overall increase of $10 per quarter, or $40 annually, in their bill.
According to the town, the service charges increase is necessary to bring them “in line with industry standards.” Serfass said the town’s utilization of federal coronavirus relief funds for $5 million in infrastructure costs prevented rates from growing even faster.
Vienna was allocated a total of $17.1 million by the American Rescue Plan Act, about $13 million of which the town intends to spend on water, sewer, park, street, and sidewalk infrastructure projects. The second half of the funds are expected to come in June.
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