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Poquoson officials warn $4 million budget headwind as schools and city weigh pay increases
Summary
City and school leaders told the joint work session that three factors — $2.7 million in tax exemptions, a 19% jump in health-care costs (about $563,000) and a state LCI change that created roughly a $750,000 hole — combine to create roughly a $4 million shortfall entering FY2027. Staff outlined grant restrictions, ADM assumptions and options if the state approves additional pay.
Mayor Huxley opened the joint City Council–School Board work session by telling attendees that three factors beyond local control are driving a roughly $4 million budget shortfall for FY2027: $2.7 million in tax exemptions, a 19% rise in employee health-care costs (about $563,000) and increased state Local Composite Index (LCI) calculations that reduced state aid by roughly three-quarters of a million dollars.
School Board Chair Chris Burbage introduced the school leadership team, and Tracy Spence, who addressed budget details and staffing costs. Spence said the school presentation assumes a 2% compensation increase; if the General Assembly instead approves a 3% increase for SOQ (Standards of Quality) positions, the local share of that extra 1%…
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