City manager: new supplemental revenue and school reimbursements avert planned budget cuts; council offered 4% wage increase
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Summary
City staff reported two late revenue changes — supplemental real‑estate assessments and increased school reimbursements — that allow the city to restore program funding previously endangered by a state grant veto and raise the FY26 general wage increase from 3.5% to 4%.
The city manager and budget staff told the Hampton City Council on May 20 that unexpectedly large real‑estate supplemental assessments and increased reimbursable payments from Hampton City Schools created roughly $1.2 million in additional revenue, enabling the city to restore programs and provide a larger across‑the‑board pay increase for employees.
City Manager Mary Bunting said the city had planned to use a SAFER communities and violence‑prevention grant to avoid recurring general‑fund costs, but the governor’s line‑item veto removed that grant. Budget staff then identified two one‑time revenue opportunities: first, supplemental tax assessments tied to several large economic development projects that had issued certificates of occupancy after the assessor’s preliminary roll; second, a one‑time increase in reimbursables from Hampton City Schools after the General Assembly removed a previous support cap for school funding.
Interim budget manager Angelique Schenk said the assessor’s supplemental value boost is expected to generate about $750,000 and the school reimbursables approximately $504,000, together providing the roughly $1.2 million to restore previously proposed reductions and to raise the FY26 general wage increase from 3.5% to 4% without cutting other council priorities. Schenk said the city would move some previously budgeted items into clearer budget lines (for example, outside agency support for the Virginia Air and Space Science Center and a special assessment allocation for Elizabeth Lake).
The manager and budget staff cautioned that the revenue gains were the product of rare timing and one‑time changes and should not be relied on as a recurring solution. Staff said they will prepare the necessary adoption documents for the evening meeting so council can consider the amendments at budget adoption.
Ending: Council received the briefing; staff will prepare formal amendment language and supporting documents for the scheduled budget adoption vote.