Fairfax County board approves real estate tax hike, laments state under-funding

The Fairfax County Board of Supervisors (staff photo by James Jarvis)

The Fairfax County Board of Supervisors has signed off on a 3-cent bump in its real estate tax rate, a move it said was partly forced by insufficient state funding.

The board approved the new rate yesterday (Tuesday) as part of a mark-up session on the fiscal year 2025 budget, which will be formally adopted next Tuesday, May 7. The 3-cent hike is expected to generate about $97 million in additional revenue for the county — about $32.3 million less compared to the 4-cent increase initially proposed.

With much of that money going towards county and public school employee salaries, the supervisors acknowledged a need to retain skilled workers and maintain quality public services, but many voiced concerns about the county’s overreliance on real estate taxes.

As a Dillon Rule state, Virginia limits counties to the taxing authorities explicitly granted by the General Assembly. In guidance for next year’s budget, the Board of Supervisors noted that it will continue advocating for broader authority from state lawmakers, while also directing County Executive Bryan Hill to determine what additional revenue options are currently available.

“I think it’s incredibly important that we try to diversify our tax base, and we try to take the tools available to us that the state has given us to us as limited as they are,” Dranesville District Supervisor Jimmy Bierman said.

The supervisors said the board was compelled to raise the real estate tax due to a lack of funding at the state level, particularly criticizing state officials for underfunding Fairfax County Public Schools.

According to a study conducted last year by the Joint Legislative Audit and Review Commission (JLARC), Virginia schools receive $1,900 less per student in kindergarten through 12th grade (K-12) funding than the national and regional averages. FCPS alone is shortchanged an estimated $345 million.

“We cannot do this alone…We also can’t hold our breath for them to step up,” Palchik said. “So, we are pushing, and we hope that they will finalize a budget and bring us more state champions who will help us bear the burden of funding those services that keep us a great community, our schools, our public safety, our parks, and everything that we do here.”

The General Assembly will convene for a special session on May 13 to discuss the state budget after the House of Delegates rejected amendments from Gov. Glenn Youngkin that included a 3% salary increase for teachers for the next two years.

While hopeful the county will get more financial support once the bi-annual state budget is adopted, several supervisors anticipate it won’t be enough to support the county’s future needs.

“We would be sitting here talking about reducing our tax rate dramatically if the 18 cents that the state owes us by their own formula arrived here at the government center in the form of a check,” Board Chairman Jeff McKay said. “That’s why our residents are suffering with real estate assessments: They pay a lot in income taxes to Richmond, and then we have to charge them a lot for real estate tax assessments to maintain a high-quality public school system and our own staff.”

Supervisors characterized the county’s situation as critical with costs rising and revenue declining, particularly from a sluggish commercial sector.

According to McKay, the county’s largest expense is paying county and school employees, which account for 82% of general fund expenditures.

At public hearings on the budget, several local labor union representatives urged the board to implement a 4% market rate adjustment (MRA) for county employees, as dictated by the county’s formula for calculating annual worker pay raises.

Ultimately, supervisors opted to fund the 2% MRA recommended by Hill, acknowledging that expenses will continue to escalate as employees seek improved compensation to cope with living in one of the nation’s highest-cost areas.

Expressing disappointment with the decision, Tammie Wondong, president of the Fairfax County Government Employees Union chapter of SEIU Virginia 512, pledged that the union will persist in advocating for improved wages to secure access to a “better quality of life” for its members.

“It’s concerning that the Board of Supervisors would recommend partial funding for the MRA,” she told FFXnow in an email before the mark-up session. “With partial funding, government workers will still struggle to pay for necessary things like food and medicine, and the county may continue to lose great employees to neighboring counties as a result.”

In addition to the lower-than-advertised tax rate increase, the board approved adjustments to the FY 2025 budget that included $24,000 for stipends to the Fairfax County Planning Commission and $25,000 to restore a Youth Leadership Program that provides summer internships in the county government to high school students.

The package also deferred $7.56 million in fuel and information technology costs, and the county will phase in a planned increase in senior center membership fees over two years, instead of implementing it all at once.

Supervisors acknowledged that homeowners will keep shouldering the county’s tax burden unless alternative revenue sources are identified, though no specific proposals were raised.

“The only glimmer of hope in this budget is the guidance, which helps us look at what is next,” Providence District Supervisor Dalia Palchik said. “How do we continue to ensure that we can diversify our tax base, continue to invest in our housing and our employees, and that, hopefully, we’re not faced with harder budgets than this one. But, right now, it is looking very likely that that is the case.”