Alexandria’s chief financial officer Bruce Johnson said he will present the city council with a better-than-expected outlook for the 2011 housing market later this week, good news for city officials who will be begin building their 2012 budget.
City officials, coping with declining property-tax revenue, were expecting another tough year after facing a $44 million deficit in their current spending plan. But the decline won’t be as bad as the city had anticipated, said Johnson, who will present the updated revenue estimates Monday. A public hearing on the 2012 budget is scheduled for Saturday.
The city drafted its current $530 million budget expecting property values to decline 4.5 percent from 2010 to 2011.
“Our look at it is it will probably be better than that, by some margin,” Johnson said. “So we’ll get at least what was projected from the budget for the 2011 tax revenues.”
Alexandria releases new property assessments each February, and collects taxes in June and November.
Even if the decline is less than was expected, Alexandria could still be in for another round of spending cuts and tax increases.
Shrinking property values have hurt Alexandria’s budget for the past several years. From 2009 to 2010, property values decreased 7 percent on average in the city. The western half of Alexandria was hit the hardest — single-family home values decreased as much as 7.9 percent, and condominium values slid up to 14 percent. To compensate, the city raised the property tax rate about 7 cents this year, up to 97.5 cents per $100, which Johnson said would generate $19.2 million.
