Local Governments: Budget Basics

May 16, 2016

Across Virginia, local governments are balancing their books any way they can. Some are raising taxes on hotel guests. Others are increasing the cost of street parking. 

Let’s start with the good news. The state of Virginia’s economy is strong. Here’s how Steven Fuller at George Mason University’s Center for Regional Analysis describes it:

“Virginia has, over the last two years, gone from zero growth — no job growth at all to early 2014 — to the strongest job growth in any twelve month period in more than ten years."

So that’s the good news. But there’s bad news for mayors and city council members and board of supervisors all across Virginia. They still have to balance the books, and that usually means finding new sources of revenue. Arlington is going to hit up its hotel guests for more money. Richmond is raising the cost of street parking and increasing the vehicle licensing fee.

“As a whole, across Virginia, cities are having probably their very best year since the Great Recession came on."

That’s Frank Shafroth, director of the Center for State and Local Leadership at George Mason.

“Property taxes took the biggest hit, so cities were hit harder than any other level of government."

Fortunately for all those mayors and city council members across Virginia, the General Assembly did not cut its budget for education this year.