F
redericksburg City Manager Tim Baroody presented his recommended Fiscal Year 2026 budget, citing the city council's vision for Fredericksburg as a place that works for everyone and is desirable to live in. To achieve this, the budget includes a 3-cent real-estate tax increase, bringing the overall rate to 80 cents per $100 of assessed value.

    The proposed budget allocates $136.75 million to the general fund, a 6.9% increase from last year's adopted budget. A significant driver of this increase is an additional $4 million for Fredericksburg City Public Schools, which aims to remain competitive and retain its workforce by offering a 5% pay increase for all staff.

    The budget also allocates more funds to the Rappahannock Regional Jail, with nearly $5.2 million in FY 2026, a $1.6 million increase from last year. The city's bond ratings have improved, placing it one notch below AAA with major rating agencies.

    Baroody highlighted several "legacy" projects, including upgrades to the city's wastewater treatment plant, which is at 85% design and engineering stage. With anticipated outside funding of over $100 million, this project is considered the biggest in the city's history.

    A public hearing on the budget is scheduled for April 15. Baroody acknowledged that proposed budgets involve guesswork, particularly with federal cuts affecting several programs in the city. To mitigate potential revenue declines, the city can defer hiring new employees, set aside funds in a revenue stabilization reserve, or appropriate only 90% of approved budget funds pending a mid-year review.