Manassas City Council set the city’s new advertised tax rate at $1.45 per $100 of assessed value for the coming fiscal year, committing to lower the real estate rate by at least 1 cent.
Earlier this month, City Manager Patrick Pate proposed a budget that would cut the rate to $1.426 per $100, saying that even with the reduced rate, his proposed $271 million budget would be able to increase the city’s allocation to its school system by about $1.5 million while adding $4 million to the general fund.
Councilmember Theresa Coates Ellis – the council’s lone Republican – as well as Democratic Councilmember Ralph Smith spoke in favor of lowering the rate to Pate’s recommended $1.426, but the rest of the council stuck with a motion to set the advertised rate at $1.45. Mayor Michelle Davis-Younger reiterated that the advertised tax rate is not the final rate for the 2022 fiscal year – that number will be set when the budget is finalized and adopted in May. Instead, the advertised tax rate is the highest possible rate that can be adopted, established for the purposes of public hearings that will take place starting next month.
“All we’re doing is voting on the advertised tax rate; this doesn’t mean that this is the rate that any of us are going to support,” Councilmember Tom Osina said. “At this point, in fact, I will tell you that this is not a rate that I would necessarily support, but that’s why we have these work sessions coming up.”
The city’s real estate assessments continued to increase over the last year, despite the impacts of the COVID-19 pandemic on the local economy. According to Pate, assessments grew from $5.4 billion to $5.7 billion in total.
Pate proposed a similar cut last year, but the council ultimately reduced the rate by 2 cents to $1.46, rather than the 4-cent reduction he proposed. Councilmembers at the time cited concerns over the pandemic and what it could do to revenues. Ultimately, the city has maintained a surplus this year despite drops in certain tax revenues like the meals and lodging taxes.
While Coates Ellis and Smith are on record as supporting a lower rate for the next fiscal year, Vice Mayor Pam Sebesky said that she had concerns about Pate’s proposed tax rate, because the city has substantial funding needs.
Pate said that the amount of funding the city would receive from the recently-passed American Rescue Plan Act is still unclear, but that although there would probably be fewer restrictions placed on that money’s uses than there were under the CARES Act in 2020, the city would still be somewhat limited in how it could use the money.
“Those funds are not in place to supplant any existing services that are going on. … We'll have to be very careful about how we deal with those funds, but I do not anticipate those funds will be available to replace programs that you’ve got in the budget,” Pate told the council. “We really have to wait and see how that really works out and what comes of that.”