The Town of Vienna plans to stick with its current real estate tax rate, breaking from the hikes floated by many of its neighbors in Northern Virginia, including Fairfax County, the Town of Herndon and Fairfax City.
However, rising property values will still result in higher bills for most residents, while enabling the town to fund employee pay raises, an initial allocation toward a potential swimming pool and fitness center, and other priorities, according to the proposed fiscal year 2026 budget released on March 5 by Vienna Town Manager Mercury Payton.
In a press release, Payton noted that the $55.47 million budget increases spending from by $1.7 million or 3.2% — a “modest” bump compared to the 7.5% increase seen from fiscal year 2024 to the current fiscal year 2025 budget, which took effect on July 1, 2024.
“This proposed balanced budget is lean compared to previous budgets,” Payton said, describing the increase as a response to inflation. “… While proposed budgets in some of our neighboring jurisdictions call for an increase in property taxes to cover their operating expenses, our proposed budget demonstrates our commitment to provide services that we can with the revenue that we have.”
Approximately 43% of the town’s general fund revenue comes from real estate taxes, which are imposed at a rate of 19.5 cents per $100 of assessed value. With 43.6% of residential properties now valued at over $1 million — up from 36.4% last year — and 44.2% worth between $700,000 and $1 million, the average homeowner’s tax bill is projected to jump 7% from $2,204 to $2,359.
The rising assessments reflect Vienna’s ongoing status as “a highly desirable place to live,” Payton said in a message on the proposed budget, which anticipates an additional $847,500 in real estate tax revenue. The town’s limited supply of new housing, as opposed to redevelopments of existing properties, may also be a factor.
Unlike in Fairfax County, though, where the commercial property tax base continues to shrink, non-residential assessments are expected to go up by $25.1 million to $1 billion, a 2.5% increase. Commercial vacancy rates in the Vienna area sat at 4.7% on average by the end of 2024 compared to 13.2% for the county, according to the budget.
The Town of Vienna also expects to receive increased revenue from meals, business license and sales taxes, along with fees for parks and recreation programs.
“Meals tax collections are forecasting very favorable to [the] budget in FY 2024-25, with the addition of a wide range of successful restaurants and coffee shops, and the continued success of long-standing businesses within the Town,” Payton wrote in the budget.
Even with the projected influx in revenue, the town directed all departments “to adhere as closely as possible” to their current budgets, limiting new spending requests.
According to Payton, the proposed budget accommodates expected increases in the costs of fuel, utilities and vehicles, which will likely become more expensive due to the Trump administration’s planned tariffs as well as inflated steel prices.
The budget also funds pay raises for both general employees, who are in line for a 2% market rate adjustment (MRA) plus a 1.0% merit increase, and sworn police officers, who would get a total raise of 4.5% with a 2.5% step increase and the 2% MRA.
Outside of the $880,020 allocated for worker compensation, the biggest source of additional spending is $200,000 to start an operating reserve fund for the aquatics and fitness center that town leaders have envisioned building on the former Faith Baptist Church property at 301 Center Street South, now known as the Annex.
With a consultant report estimating that it would cost up to $26.6 million to build the facility by 2029, the town has been considering a temporary 1% increase to its meals tax rate, which is currently at 3% — the lowest rate allowed by Virginia law. But the Vienna Town Council voted in January to defer a decision on the proposal until Aug. 25, citing the uncertain economic climate created by the federal government.
The Vienna Parks and Recreation Department’s planned initiatives for FY 2026 include the development of “a capital campaign program as an alternative funding source to support large projects,” but it’s unclear whether a fundraiser is being considered instead of, or possibly in addition to, a meals tax increase.
The full proposed FY 2026 budget can be found on the Town of Vienna’s website.
Following an initial discussion of the budget on Saturday (March 15), the town council is scheduled to hold a second work session tonight (Monday). Public hearings will be held on April 7 and 28 before a new budget is officially adopted on May 19.
