The Virginia City Council on Dec. 23 adopted a $8,818,921 property tax levy and a $21,043,344 budget for 2026 following a Baker Tilly presentation that projected long-term budget pressure in the ambulance and event center funds.

City consultants Matt Stark and Steve Scharf of Baker Tilly presented a 10-year financial model showing recent deficits in several funds and a path to fiscal sustainability. Stark said the city has narrowed a large structural gap since 2022 but remains below a 2012 city policy target of holding an unassigned general fund balance equal to 35% of regular expenditures. "The numbers never sleep," Stark said during the presentation, urging the council to begin longer-term planning now.

Scharf walked the council through property-tax scenarios and estimated that a 1% change in the tax rate would raise roughly $90,000 for the city; he said a steady 5% annual increase in the tax rate would stabilize the modeled general fund balance but emphasized that any solution will be a blend of revenue increases and cost reductions.

Councilors debated how to balance capital needs, debt service and operating spending. Councilor Paulson pressed for clearer accounting of debt levies versus the general levy so taxpayers understand which dollars pay ongoing operations and which pay past borrowing. Scharf recommended communicating those pieces separately and noting that much of the debt levy is fixed to prior borrowing.

Councilor Johnson opposed the levy and budget votes. In a lengthy floor statement she said the city had removed numerous capital and operating items from next year's budget, including vehicle replacements, several capital requests and roughly $400,000 in ambulance equipment, and warned those cuts would affect services and safety. "We can't keep doing what we've been doing," Johnson said, arguing the council had not raised the levy enough to rebuild reserves.

Mayor Larry Cuffey Jr. and other councilors said staff and consultants would continue work on a fiscal sustainability plan and training for city staff on the new model; consultants committed to turn over the forecasting tool and to provide training early in the new year so staff can update scenarios as real-year results arrive.

Votes at a glance
- Adopt final property tax levy (dollar total): $8,818,921 — Passed 5-1 (Recorded roll call; Councilor Johnson voted no).
- Adopt 2026 budget (total sources of funds): $21,043,344 — Passed 5-1 (Councilor Johnson voted no).
- Finance resolution 25-024 (schedule of bills) — Adopted (voice vote).
- Consent agenda (minutes, pay application, raffle permit, travel requests, schedule of bills except pull items): Approved (voice votes).
- Multiple 2026 licenses (tobacco, liquor, massage, kennel, pawn broker) and contract approvals were approved by voice roll or recorded vote during the meeting (see meeting record for the full list).

What the consultants recommended
Baker Tilly advised the council to: restore unassigned fund balances for major funds; close revenue/expenditure gaps in the ambulance and event center funds (including through billing improvements and revenue diversification); prioritize capital projects against long-term debt service; and develop a fiscal sustainability plan that aligns budgets and long-term priorities. Consultants said capital spending is front-loaded in the next 10 years and that paying attention to debt service timing will free capacity after certain bonds retire.

Next steps
Council and staff asked consultants to deliver the final forecasting tool and train staff in January. Staff will continue budget conversations, review enterprise fund rates and grant opportunities, and bring follow-up items (enterprise rates, radio/grant updates, and capital prioritization) to upcoming meetings. The council set the next regular meeting for Jan. 13, 2026.