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Charlottesville council signals support for 1¢ tax increase, to use citywide reserve to close $228,000 gap

Charlottesville City Council · April 3, 2026

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Summary

At a special work session the council agreed in principle to support cutting the proposed 2¢ tax increase to 1¢ and to make up an estimated $228,000 shortfall mainly from the citywide reserve and revenue adjustments ahead of next week's budget readings.

Mayor and councilors at a Charlottesville special work session on April 2 signaled support for narrowing a proposed 2¢ real-estate tax increase to 1¢ and agreed to make up an estimated $228,000 gap from the citywide reserve and revised revenue adjustments.

Staff presented the budget math: "The 2¢ tax increase was 2,400,000.0, which got us to the total budget of 279,000,000," a staff member said, and explained that backing out one penny removes roughly $1.2 million; revised revenue projections and other adjustments reduced that shortfall to about $228,000. Councilors discussed options including delaying hiring under scenario C (estimated savings of about $369,000) or drawing on the citywide reserve.

The council coalesced around a plan to support the 1¢ option with the gap to be covered largely from the citywide reserve rather than immediately activating the personnel scenario. Multiple councilors indicated they could live with balancing the budget using one-time reserve dollars in combination with modest revenue adjustments.

City staff noted the next procedural steps: Monday's meeting will include the real-estate tax hearing and the first reading of the budget ordinance; adoption is scheduled for Thursday. Staff said they would prepare the numbers and language needed for the readings so the council can finalize the choice, and that further adjustments could still be made before adoption.

The council did not take a formal recorded vote in the work session; members expressed verbal agreement to proceed with the 1¢ plan and staff follow-up.