Charlottesville council adopts $265.25M FY2026 budget, boosts schools, housing and transit

Charlottesville’s City Council on April 14 adopted the fiscal year 2026 budget, approving an ordinance that sets total revenue and expenditures at $265,248,446 and carries forward existing tax rates.

City Manager Michael presented the budget on its second reading, saying overall growth from the prior year is about 5.28% and that the administration proposed no tax-rate increases. "We proposed the budget without a change to the tax rates," he said, and highlighted four budget drivers: schools, affordable housing, transportation and organizational stability.

The budget adds a local schools contribution of $4.9 million, which the manager said is above the formula amount of roughly $3.5 million; it also includes an additional $1.4 million per year for school capital improvements and about $1.3 million annually for ongoing maintenance. The council was told affordable housing would receive $12.7 million in FY26, rising to about $53 million over five years; the manager said the $12.7 million does not include a separate $2.5 million designated for tax-relief programming and that council has set aside $750,000 a year for homelessness interventions.

Transit and transportation received attention in the presentation and follow-up discussion. The manager said collective bargaining increases are estimated to add $1.4 million in total cost for the budget year, that the city added a transit mechanic and that it will continue fare-free service while federal flexible funds are unavailable. He said a new sidewalks program includes $5.4 million spread across five capital-improvement years. The manager estimated it would cost roughly $1.2 million a year (driver wages only, excluding mechanics and administration) to expand operations from the current 66 drivers toward the community’s target of more than 80 drivers to achieve 30-minute frequencies on more routes.

Council members asked about the city’s surplus and the timing of allocations. Michael said staff are monitoring federal developments, that several nonprofits have reported terminated federal grants and resulting losses, and that staff will package requests for surplus spending to the council in one of the next two meetings. He emphasized that one-time surplus funds are best used for nonrecurring items, not ongoing staffing commitments.

The city manager also apologized for errors in the budget advertising process and said the administration moved quickly when it discovered the problem. He stated the city attorney had a plan in court and that a judge named in the record (Judge Rel) resolved the matter quickly. "We apologize for the mistakes," he said, and pledged strengthened checks and balances.

Budget staffer Miss Hamill summarized the amendment sheet the council had reviewed. She noted an allocation of $30,000 to the Tonsler League reallocated from previously awarded BCF funds (Freilen referenced in the record) and said additional appropriations from existing budgets will be presented as a resolution in May. The amendments discussed at the meeting were incorporated into the motion to adopt.

A council member moved to adopt the budget with the amendments presented and a second was recorded. The chair called for a vote and announced the motion passed; the transcript does not record a roll-call tally or name the mover and seconder. Following the vote the council moved to adjourn; members indicated they would reconvene in July.

The ordinance adopted at this meeting ("ordinance adopting the budget and appropriating funds for the City of Charlottesville, Virginia for the fiscal year ending June 30, 2026") was approved on second reading at the April 14 special meeting. The record does not show an ordinance number, a roll-call vote breakdown, or the names of the specific movers/seconders on the motions.