City manager proposes $956 million FY 2026 operating budget, $2.08 billion CIP with no tax rate increase

Alexandria City Manager James Perjean on Feb. 25 unveiled a proposed $956,000,000 operating budget for fiscal 2026 and a $2.08 billion 10-year capital improvement program, telling the City Council the plan does not include a tax-rate increase.

"The proposed budget does not include a tax rate increase," Perjean said during a presentation that framed the package as a cautious plan to maintain services while preparing for economic uncertainty at the federal level.

Why it matters: The proposal preserves city priorities including sustained investment in Alexandria City Public Schools (ACPS), housing, public safety and employee retention while highlighting the city’s imbalance between residential and commercial tax bases. Perjean told the council the package aims to protect the city’s AAA bond rating and to leave resources available if federal grants or regional economic conditions change.

Key details - Operating budget: $956,000,000 (about a 3.1% increase over the prior year as presented). - 10-year CIP: $2.08 billion (the manager said the FY26 CIP is lower than last year’s approved 10-year plan, reflecting project reprioritizations). - Schools: The proposal includes roughly $329,000,000 for ACPS (approximately $281 million operating transfer and $48 million debt service). The school board requested a larger increase; Perjean said fully funding that request would…