Fredericksburg City Council Meeting
The City Council moved Tuesday on a number of significant financial issues, including the new fire station design, the wastewater treatment plant plans, and the FY 2026 operating and capital budget.
By Martin Davis
EDITOR-IN-CHIEF
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Following a difficult budgeting process that has been made more challenging by potential significant changes in the number of federal dollars that may flow to the state and local levels, the Fredericksburg City Council on Tuesday night finalized several significant financial projects.
On a 7-0 vote, the Council voted on Tuesday to approve the FY 2026 Operating and Capital budget.
The FY 2026 budget totals $136,893,000 and represents a 7% increase over the FY 2025 budget.
The resolution that Council voted on Tuesday night is based upon a projected slowdown or stabilization in several areas. Per the resolution:
It is forecasted that the City will see minimal or stabilized growth during FY 2026. The local and regional economy has remained resilient despite many economic factors but is starting to see slower growth. The large growth that was recognized during the FY 2024 budget has stabilized as it relates to consumption-based revenues therefore these sources do not provide the natural growth to keep other tax rates level.
These projected slowdowns moved the city to raise the real estate tax by 0.04 cents.
To address concerns about potential declines in the local economy and the possibility of federal cuts, the Council also voted to set the legal appropriation level for several areas lower than what was budgeted. Council will then monitor the financial situation throughout the year and “will increase the appropriation to match the budget level through a mid-year amendment if economic conditions do not deteriorate.”
The line items and the amounts on hold are:
Fire Station #3
The Council also moved to enter into a Contract with DJG, Inc., for the design of Fire Station #3, which will be built at the intersection of Fall Hill Avenue and Whitlock Drive.
The design contract is for just under $1.8 million. Anticipated construction costs are around $20 million, with another $1.8 million needed for apparatus in the new fire house.
Council member Jannan Holmes asked why the new station would not seek LEED certification. (LEED stands for Leadership in Energy and Environmental Design, and LEED certification “provides a framework for healthy, efficient, and cost-saving green buildings,” according to the U.S. Green Building Council website.)
Her concern was if the city isn’t pursuing LEED certification with this project, “how we are still going to work on our sustainability goals?”
Deputy city manager David Brown noted that “we would be incorporating those various components that would be eligible for consideration for LEED certification, but we’re not actually pursuing the certification itself.”
The principle reason being the additional costs that come with obtaining that certification, and the requirements and costs associated with maintaining it.
Waste Water Treatment Plant
The other big-ticket item on the agenda Tuesday night was the approval of a second amendment to the interim agreement with Ulliman Schutte Construction, LLC. According to the resolution the Council approved on a 7-0 vote, “The proposed second addendum to the Interim Agreement will permit the advancement of the 85% to 100% design phase for the planned facility expansion and upgrades to accommodate future residential, commercial, and industrial growth. The planned project will ensure compliance with water quality requirements of the City’s Virginia Pollutant Discharge Elimination System Permit.”
Prior to the Council meeting, there was a work session at which the council was brought up-to-date on the progress in moving toward a comprehensive agreement for constructing the wastewater treatment plant, including its guaranteed maximum price.
As of now, the anticipation is that at the June Council meeting, that document will be ready to review.
The anticipated guaranteed maximum price for the project is just under $168.5 million.
Funding for the project will come from seven sources.
Of these, only the Virginia Clean Water Revolving Loan Fund (VCWRLF) would have to be paid back with taxpayers’ dollars. And the amount of that loan has declined since December 2024, thanks to an increase in dollars the city anticipates receiving through its Water Quality Improvement Fund grant (WQIF) which is provided by the state.
Mayor Kerry Devine praised staff in securing the funding to make this project happen, and celebrated them again in a call with the Advance Wednesday afternoon. “Staff has done an amazing job of getting resources for this,” she said. Noting that the taxpayers will still need to foot approximately $60 million of this project, that number is much lower than was projected when the city was talking about doing the project with Spotsylvania, and has been reduced 2023 and 2024 estimates which were closer to $80 million.
According to the state’s Department of Environmental Quality website, Fredericksburg’s request for $58.9 million from WQIF should be approved on or about June 14 of this year.
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