Albemarle County Board of Supervisors FY2027 Budget Work Session #1 – March 9, 2026

The Board of Supervisors held its first budget work session for the Fiscal Year 2027 operating and capital budget on March 9, 2026, from 5:00 PM to approximately 8:45 PM in Room 241. Staff presented an overview of the total county budget, general fund revenues, compensation and public safety expenditures, and judicial chapter. The board asked clarifying questions and provided initial feedback but took no formal action. The next work session is scheduled for March 11, 2026, at 5:00 PM.

Public Comments & Testimony

• No public comments were taken during this work session.

Discussion Items

Total Budget Overview

• The total FY2027 recommended budget increases by $86 million (13.5%) to approximately $724 million. The three primary drivers are: (1) a 7.6% increase in general fund local revenues (primarily tax revenue), (2) nearly $13 million in new state revenue support for public schools, and (3) the $40.8 million Boulders Road capital project (with $20 million from the state, $12 million from AstraZeneca, and the remainder from county land and previously appropriated funds).
• The general fund ($512 million) is the focus, as it contains all unrestricted tax revenue and offers the most policy discretion.

General Fund Revenues

• Tax revenue diversification challenges were highlighted: between 2015 and 2025, the residential share of the real estate tax base grew from 65% to nearly 74%, while commercial/industrial fell from 15% to 11.3%. Residential properties cost more to serve (due to schools) than they generate in taxes, while commercial/industrial are revenue positive.
• Real estate revenue is projected to increase 7.6% ($20.5 million) due to a 6.2% reassessment in calendar year 2026 plus new construction. The recommended tax rate remains 89.4 cents per $100 of assessed value. The “lower tax rate” (offsetting assessment increases) would be 84.2 cents; each penny of the rate is worth $3.3 million.
• Personal property tax revenue is projected to increase 17% (nearly $7 million) due to improved collection rates, a higher number of vehicles being identified, refined assessment data (VIN-based), and supply chain effects on used car values. The rate remains $4.28 per $100 of assessed value; a penny change is worth $113,000.
• Other local taxes (sales, food & beverage, transient occupancy, business licenses) show modest growth. All except transient occupancy are at the state cap. The transient occupancy tax (currently 9%) is not capped; staff will provide comparative data to other metro areas.
• State and federal revenues make up only 8% of the general fund. State revenues are essentially flat; federal revenues (mostly Social Services) are up 9% but are subject to uncertainty (e.g., SNAP administration).
• Fund balance: $98.3 million total. The unassigned fund balance (10%, or about $51.4 million) is reserved for emergencies. A 2% budget stabilization reserve (about $12 million) is being proposed for use. The plan uses $3 million in FY27 and $3 million in FY28 (0.5% each year), leaving 1% untouched. The reserve would be replenished with any future surplus before funding other one-time priorities.

General Fund Expenditures – Compensation

• The largest expenditure category is the transfer to schools (52% of every tax dollar), followed by public safety (14%), community development (10% including Boulders Road), and county government operations (10%).
• Compensation: The budget includes $2.9 million for a market-based adjustment for classified staff (based on the 2022 pay philosophy targeting the market average of 23 comparator agencies), a 2% cost-of-living adjustment (COLA), and a one-time bonus (mirroring the state’s proposal). For public safety, the recommended budget provides 11% pay scale movement (step increases) costing $0.7 million plus market adjustments. The health self-funded fund increases 8% ($2.1 million). The Virginia Retirement System rate decreased by 1.33 percentage points, saving the county $1 million (and $3 million for schools).

Public Safety

• Staffing Studies (ESCI): The board received the public safety staffing studies in October 2025. Implementation is phased. Tier 1 priorities: add and maintain staffing. FY27 includes 3 new police officers and a plan to pursue a FEMA SAFER grant for 6 firefighters. Compensation and retention are the immediate focus. The long-range recommendation is 39 additional police officers and 35 additional firefighters, phased into the five-year plan.
• Police Department (Chief Reeves): Current sworn strength is 149 of 171 authorized positions; only 138 are deployable. Calls for service rose 23% from the prior year to nearly 93,000 (62% officer-initiated). Part 1 crimes decreased for the second straight year; gun violence dropped 30% in 2025. Response times: urban ring priority calls average under 10 minutes; rural areas take longer. Recruitment is very challenging (applicant pool shallow, many disqualified). The proposed 3 new officers are for patrol.
• Fire Rescue (Chief Puckett): recent investments (FY25) added an ambulance to the Seminole area and 24/7 career staffing at North Garden Volunteer Fire Company. Positive early data: Seminole ambulance reliability increased to 80%, response times down nearly 1 minute; North Garden ambulance availability up 84%, response times down 2 minutes on nights/weekends. Current staffing: 77% of FTEs are operational; 24 in training; 8 vacancies. Service reductions (stations reduced from 3 to 2 firefighters) peaked in 2023 and are declining; 6 additional firefighters (via FEMA SAFER) are needed to phase out service reductions entirely. Attrition was 11.5% in 2025 (largely due to recruit school and retirements; core attrition 3.7%).
• Office of Emergency Management: Established as a separate office (budget neutral) by pulling 2 FTEs from fire rescue, reporting to the county executive.
• Regional Partner Agencies: Several agencies (e.g., Albemarle-Charlottesville Regional Jail) have budget requests; some may be adjusted downward before adoption.

Judicial Chapter

• The judicial chapter (2% of general fund, $10.2 million) includes the Sheriff’s Office (53%). The budget recommends 3 new sheriff’s deputies for courthouse security, inmate transport, and civil processing, driven by the opening of renovated/expanded court facilities. Commonwealth’s Attorney, Clerk of Circuit Court, and Public Defender requests are funded at their requested levels with modest increases for COLA.

Other Items

• MicroCAT transit service: staff proposes a $2 per ride charge (with discounts) to begin mid-year, now that grant funds are exhausted. This will be discussed further on March 11.
• Community Development fees: staff seeks authorization for a public hearing on April 15 to update fee benchmarks, with discussion on March 18.

Key Outcomes

• No formal votes were taken. The board provided initial direction and asked for follow-up information on: transient occupancy tax rates in peer jurisdictions, a breakdown of investment income sources, service charge details (PILOT), and the impact of insurance ratings on fire service reductions.
• Staff will compile questions and “the list” of potential budget adjustments for the board’s consideration at work session #4 (March 18), where the board will be asked to propose a tax rate and budget for public hearing.
• The next work session (March 11) will cover non-departmental expenditures, health and welfare, transit, and community development. The final adoption of the FY2027 budget is scheduled for April 22, 2026.