Roanoke manager unveils $403.7 million FY2026 budget, presents meals-tax increase options to fund capital maintenance

City Manager Miss Turner presented a proposed fiscal year 2026 general fund budget totaling $403,689,000 to the Roanoke City Council on March 20, and outlined options to increase the local meals tax to fund capital maintenance and address a backlog of building and infrastructure replacements.

Turner said the presentation reflected “a very tight budget year” while proposing targeted investments in employee compensation, public safety, infrastructure and a five-year capital improvement plan (CIP). She told the council the budget is balanced and described proposed revenue and expenditure changes that would stabilize city finances and address deferred maintenance.

The proposal would leave real estate and personal property tax rates unchanged and increase the proposed meals tax in one scenario by 1 percentage point (from 5.5% to 6.5%) to create a dedicated capital maintenance fund. Turner also showed an alternate slide that would raise the meals tax by 1.5 points (from 5.5% to 7%). She said the additional 0.5 percentage point shown on that slide would produce roughly $2,020,000 and that one-half of the 1-percent option would add about $1,000,000 in overtime funding and $855,000 for temporary wages to staff seasonal pool and recreation operations.

Turner described key revenue and spending changes in the proposed budget. She said incremental revenue for FY2026 totals about $24.6 million, with roughly $15.4 million from general property taxes and $5.6 million in additional intergovernmental (state and federal) revenue. On the spending side the proposal includes a $5.1 million change in base pay, an additional $4.6 million for a 3% cost-of-living adjustment and full step increases for public safety employees, $2.03 million for overtime wages, and allocations for medical contracts, technology and external agencies. Turner told the council the city reduced the base budget by about $3.54 million as part of aligning expenditures with expected revenues.

Turner proposed FY2026 level funding for Roanoke City Public Schools at $106,900,000 (FY2025 level), and noted the school system’s assigned and unassigned fund balances. She said the proposed CIP for general-fund projects in FY2026 totals $55 million, and FY2027–FY2030 projects total $166.5 million. Major items Turner highlighted included a $10 million Roanoke Center for Industry and Technology (RCIT) project (to be funded with $2.5 million in bond funding and $7.5 million in state funds), $1.9 million for the passenger rail station, $7.3 million for a Belmont Library expansion (future years), and $9.5 million for renovations to Fire Station No. 2 (future years). She said the CIP would be financed with a mix of debt, pay-go (cash), and grants: $30.3 million in debt, $8.3 million in pay-go, $14.9 million in grants and $1.5 million in contingency for FY2026 projects as proposed.

Turner emphasized a new capital maintenance and replacement category in the CIP to address HVAC, mechanical and electrical systems, roofs, elevators and underground storage tanks; she said those projects would be cash-funded if the proposed 1% meals-tax increase were adopted. She also described planned annual spending levels for street pavement and ADA work (about $5.3 million/year) and other park and bridge projects, and walked council through funding from bonds, grants and available cash for specific bridge projects.

Council members asked for clarifications about federal funding amounts and the process for submitting questions. Turner said staff would provide the requested federal funding detail to council and explained a timeline for council questions: submit questions by close of business Wednesday and staff will respond by close of business Friday. She also outlined public engagement dates: community budget meetings on April 10 (Unitarian Universalist Church) and April 17 (Pilgrim Baptist Church), a public hearing on April 21, a budget work session on May 5 and final adoption on May 12.

Before the presentation began, the council approved a walk-on motion to convene a closed meeting under the Code of Virginia, section 2.2-3711(A)(7), to consult with legal counsel; the motion was moved and seconded on the record and approved by roll call. The council recessed to the closed meeting after the presentation and Q&A.

Votes at a glance

- Motion: Convene a closed meeting to consult with legal counsel regarding a legal matter requiring the provision of legal advice by the city attorney pursuant to section 2.2-3711(A)(7) of the Code of Virginia, as amended. Mover: not specified. Second: not specified. Vote: Miss Powers — Aye; Mister Hagen — Aye; Miss Sanchez Jones — Aye; Vice Mayor McGuire — Aye; Mister Nash — Aye; Mister Vollison — Aye; Mayor Cobb — Aye. Outcome: approved.

The presentation materials and the draft proposed budget will be posted to the city website. Turner asked council members to review the budget books and submit any questions by the council schedule so staff can provide consistent answers to the whole council.