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Local real estate tax bills are likely still going up, but not as much

Supervisors mull a cut to the county’s main tax rate for first time since 2016

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The Prince William Board of County Supervisors listen to a presentation during the board’s April 6 meeting. File photo.

The Prince William Board of County Supervisors is poised to reduce the county’s real estate property tax rate for the first time since 2016, while increasing the county’s data center tax rate and implementing a new cigarette tax to fund the budget for the next fiscal year, which begins July 1. 

The board unofficially agreed upon the changes in tax rates in a series of straw votes taken during a four-hour budget markup session Tuesday, April 20. The board will officially vote to adopt the county's new budget at its next meeting, Tuesday, April 27. 

The new tax rates were proposed by at-large Chair Ann Wheeler (D) following adjustments to the county’s revenue forecast that freed up several million in spending. The board voted 7-0 in a straw poll vote to reduce the county’s proposed real estate property tax from $1.125 to $1.115 per $100 in assessed value – a 1-cent decrease. 

The change would lower the average residential real estate tax bill increase from $306 to $264, Wheeler said.

Supervisor Pete Candland, R-Gainesville, abstained from voting in the straw poll. 

The county’s real estate tax rate has remained flat at $1.125 per $100 in assessed value since 2017. Meanwhile, real estate assessments have increased every year, including a 7% increase in assessments this past year.

The lower tax rate means the county government and schools will receive $6.8 million less from local real estate taxes next year. The county and school division use a revenue-sharing agreement that traditionally directs 57.23% of the county’s local, general fund tax revenue to schools. The change would result in $3.9 million less in funding for schools than was originally proposed. 

Local funding to the school division for next school year will still increase by about $30 million over this year’s revenue, even with the tax cut.

The board also agreed to reduce the proposed business tangible computer and peripheral tax, also known as the data center tax, from $1.60 to $1.50 per $100 in assessed value. Still, that represents a 15-cent increase in the data center tax over this year’s rate of $1.35 per $100 in assessed value. 

The board voted along party lines 5-3 in a straw poll vote to reduce the proposed data center tax rate, with all Democratic supervisors in favor and all Republicans opposed. 

Republican supervisors were split on the data center tax rate. Supervisor Jeanine Lawson, R-Brentsville, said she wanted to lower the proposed increase even further. Supervisors Yesli Vega, R-Coles, and Candland said they wanted the data tax rate to be increased above the initially proposed $1.60 rate. 

The board again voted on party lines in a straw poll to include a 40-cent-per-pack cigarette tax in this year’s budget – a 10-cent increase above the proposed 30-cent-per-pack cigarette tax already included in the proposed budget. The cigarette tax is a new county tax. Until this year, a cigarette tax could not be enacted locally in Virginia counties. Wheeler said increasing the cigarette tax was necessary to balance the budget after reducing the real estate tax. 

The board also tentatively agreed to add some new items to the budget. 

Supervisors agreed in a 7-1 vote to fund two new positions within the county’s social services department to address the growing number of homeless residents living in the Manassas area, along the Sudley Road corridor, and to create a new partnership with a nonprofit mobile homeless clinic that serves the area. The effort is estimated to cost about $250,000. 

All but Vega voted to support the initiative in a straw poll vote. 

The board also tentatively agreed to fund new tasers and body-worn cameras for the Prince William County Sheriff’s Office after Sheriff Glen Hill (R) filed a last-minute request last Friday, April 16. The initiative will cost an estimated $350,000. 

Supervisors will also fund 3% pay raises for all county employees in the upcoming budget after deferring those raises last year to save money amid uncertainty surrounding the COVID-19 pandemic. Board Democrats voted down a proposal Vega made during the Tuesday, April 20 meeting to increase pay raises to 3.5% for the county’s public safety employees and while reducing raises for other county employees to 2%. 

The meeting closed with the board’s Democrats, who have the majority, supporting tax rate proposals that will create a balanced budget ahead of next week’s budget adoption. Republicans on the board agreed on some – but not all – of their proposals. 

Reach Daniel Berti at dberti@fauquier.com

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