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Hampton CFO projects $472.6 million in recurring FY2027 revenue; flags state-budget uncertainty and new tax sources
Summary
Chief Financial Officer Carl Daughtry told the Hampton City Council projected FY2027 recurring revenues total $472.6 million, with $11.2 million available for general appropriation; he warned the absence of a state budget and pending legislation (cannabis sales and skills-game taxes) make some estimates uncertain.
Chief Financial Officer Carl Daughtry presented preliminary FY2027 revenue projections to the Hampton City Council and repeatedly cautioned that state-level uncertainty limits precision. "We don't have a state budget right yet, which means there's some holes," the city manager said when introducing the revenue presentation, and Daughtry echoed that the governor's signature or final legislative action could alter local estimates.
Daughtry told council staff projected recurring revenues of $472,600,000 for FY2027, a $15.9 million (3.5%) increase over FY2026, and said $11.2 million of that increase would be available for general appropriation while $4.7 million is committed to specific purposes such as school funding and VDOT maintenance. "We are projecting $472,600,000 in recurring revenues, which is a $15,900,000 increase over fiscal year 26," Daughtry said.
Key drivers cited were assessment growth (the assessor projects roughly 4% increase in taxable assessments), other general property taxes, pari-mutuel distribution changes and charges for services. Daughtry said each penny of the real-estate tax rate generates approximately $1.7 million in revenue; he did not have an exact per-penny split to hand for the share that would go to schools and offered to provide that detail later.
Daughtry outlined revenue-category details: personal-property revenues were adjusted to reflect 2025 actual collections (about $52 million) with a projected 90% collection rate; meal tax was forecast to grow about 1.3% (~$400,000); sales tax collections were revised downward from prior expectations; lodging-tax revenue was projected to decline about $300,000; and business-license receipts were up in part due to construction at the Hampton Roads Bridge Tunnel but were being treated as a one-time source for the capital-improvement plan.
He noted two pieces of recently adopted state legislation that could create new local revenue streams if finalized and signed by the governor: an adult-use cannabis retail market (with an added local sales-tax option, effective 01/01/2027) and a statewide tax on gaming devices (a 25% tax on gross profits with a local share). Daughtry said the city will work with the Commission of the Revenue to develop estimates once the bills are final.
On photo-enforcement revenues, Daughtry said the city is budgeting camera-related receipts to cover direct program costs and described new state restrictions that require remaining funds to be deposited in a dedicated local fund for school-crossing and high-risk corridor safety projects rather than for general fund use. "There was a bill ... restricting the use of these revenues to direct program costs," he said.
Daughtry finished by summarizing one-time fund-balance uses (about $9.8'$9.9 million) for capital projects and by inviting council questions; he promised to provide any requested per-penny breakdowns and other clarifying figures after the meeting.
