Waynesboro council introduces 89¢ tax-rate ordinance, debates $60 million WHS financing and budget trade-offs

Waynesboro City Council on Monday introduced an ordinance to set the fiscal-year property tax rate at 89¢ and introduced a proposed FY2026 budget for final consideration on May 12, city officials said. Council discussion before the motions focused heavily on financing assumptions and timing for a proposed $60 million Waynesboro High School (WHS) improvement project and on trade-offs the city would face among public-safety hiring, employee pay and community-support funding.

City finance staff presented updated financing scenarios for the WHS project using a $60 million project cost, an assumed 20‑year bond term and a conservative 5% interest-rate assumption. Staff said that under that scenario the maximum annual debt-service payment would be roughly $4.8 million, and that the city already has about $1.9 million available toward a roughly $4.0 million architect/initial‑draw amount for the project. Staff recommended a spring 2026 borrowing to match early construction draws, noting payments and final tallies will depend on the actual bond sale interest rate and the penny value of real-estate assessments at the time of sale.

Councilmembers and staff discussed potential offsets and alternative financing: using an existing reimbursement resolution, pursuing a VDOE loan process that staff described as not prebuilt for a construction‑management‑at‑risk procurement, joining a VPSA-style pool, applying for other loan programs (referred to in the discussion as options that could cover a portion of the project), and exploring participation in PACE-style financing programs. Staff said some loan programs could lower the city’s near-term borrowing need but likely would not cover the entire project.

The budget discussion centered on whether to introduce the tax rate at 89¢ as proposed in the staff packet or to adopt a lower introductory rate (examples discussed included 86¢, 85¢ and 81¢). Staff offered an illustrative package showing how the rate could be lowered to 85¢ by reducing the proposed compensation package, shifting some recurring operating purchases to one-time fund-balance funding, and removing the Community Vitality Fund; councilmembers debated which reductions they would accept and which services or hires should be prioritized.

Council debate was robust and mixed. Several councilmembers stressed the city’s need to address high vacancy and retention problems in public works, police and fire through compensation increases and additional hires; others urged caution because many residents face large assessment‑driven increases in property-tax bills this year. Councilmembers also discussed the Community Vitality Fund and options to channel some funding through local nonprofits (identified in the meeting as CAPSAW/CAPSOL in the transcript) or to earmark funds for targeted affordable‑housing land acquisition near transit. Staff summarized that the city provided roughly $855,000–$1.08 million to nonprofits over recent years, and that a proposed Community Vitality Fund of $300,000 would partly formalize existing support to local service providers.

Council asked staff to analyze other revenue options — including adjustments to the meals and lodging taxes and smaller items such as cigarette-tax changes — and return with legal and revenue implications. Staff noted limits in state code and the need to “run everything to ground” before recommending a meals‑tax change, and said lodging and cigarette taxes would be smaller revenue sources than meals. Councilmembers also discussed existing senior relief or exemption programs (noting some residents must apply to receive benefits) and the idea of a special district or per‑unit assessment to fund fire/EMS services.

Formal actions taken at the meeting were procedural introductions: a motion to introduce a tax-rate ordinance at 89¢ carried by council vote, and a motion to introduce the FY2026 budget (amount as read at the meeting) was similarly approved for final consideration on May 12. Staff said introduction does not lock the final rate; the council can revise the rate and budget before adoption at the public hearing and final vote. Staff also said the bond‑closing and required public-hearing ordinance for the WHS borrowing will be scheduled later in the process.

What to expect next: staff will return to the council with refined revenue estimates (including meals/lodging tax analysis if feasible), bond‑sale scenario updates once market conditions and any third‑party loans are clarified, and a proposed appropriation ordinance for the WHS project for council consideration. The council directed staff to continue work on the budget and the WHS financing timetable while seeking options to soften the immediate tax impact on residents.

Votes at a glance - Introduce tax-rate ordinance (89¢): motion introduced and approved for advertisement and final consideration May 12 (motion/second read at the meeting; roll-call allocation of yes/no not specified in the transcript). - Introduce FY2026 budget for public hearing and adoption (amount read at meeting): motion introduced and approved for final consideration May 12 (motion/second read at the meeting; final adopted amount not yet decided).