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Rockville introduces $175 million FY2026 budget, keeps property tax rate flat
Summary
City Manager Geoff Mahalik presented the proposed FY2026 operating and capital budget totaling about $175 million, listing priorities including $1 million for a Housing Opportunities Fund, $10 million for Vision Zero and pedestrian improvements, and no increase to the city property tax rate.
Rockville City Manager Geoff Mahalik on March 17 presented the City’s proposed fiscal year 2026 operating and capital budget, saying the plan totals roughly $175,000,000 and keeps the city’s property tax rate unchanged.
The proposal, which the council introduced for further review, includes $33.8 million in new capital appropriations for 65 projects, a $9.8 million general fund transfer to the capital program, and $1,000,000 set aside to seed a Housing Opportunities Fund. “The budget really includes a total expenditure of $175,000,000 across 10 funds. It's a 3.9% increase overall from last year,” Mahalik said during the meeting.
Why it matters: the budget frames the city’s priorities for the coming year and funds operating costs, capital improvements and new positions the administration says are needed to respond to growth and to accelerate permit review, housing preservation and safety initiatives.
Major items summarized by staff include: - Housing: a new $250,000 general fund transfer plus $750,000 from reserves to create a $1,000,000 Housing Opportunities Fund for preservation, an employee homeownership assistance program and down-payment assistance; two new positions to support housing programs. - Infrastructure and safety: $10,000,000 for Vision Zero and pedestrian master plan improvements; $33.8 million in CIP for parks, roadways and community centers; funding for a CCTV modernization program and two new administrative positions in the police department. - Economic development and permitting: five new positions intended to speed plan review and provide next-day inspections to support development and affordable housing efforts; $1,600,000 in recommended support for Rockville Economic Development, Inc. - Operations and resilience: funding for network infrastructure upgrades, expanded invasive-species management, electric vehicle conversions for some vehicle leases and the planned purchase of an EV bus for the senior center. - Fees and rates: proposed refuse fee increase of $30 annually and a stormwater increase of $7 per equivalent residential unit; the budget notes water and sewer rates were set under a prior 3‑year schedule.
The proposed operating budget totals about $174.9 million across all funds and preserves the current tax rate, staff said. City staff said the document incorporates a 2.5% cost-of-living adjustment and capacity for classification and compensation changes; those personnel actions will be detailed as the council reviews the budget.
Next steps: staff will hold additional work sessions and a final public hearing before the council adopts the budget. The public record remains open through April 7 and the council scheduled final adoption for May 5.
Speakers quoted or cited above spoke during the City Council meeting on March 17; staff posted a community budget priority survey and interim results as part of the public record.
