City Council Creates Commercial Property 'Add-On' Tax

In the midst of a hectic budget season, the Alexandria City Council voted Saturday to move on two tax measures that should be contentious issues at an upcoming public hearing.

The council voted to advertise a higher real estate tax rate and approved the creation of a controversial commercial property add-on tax. The add-on tax, initially set at 12.5 cents per $100 of valuation, is to generate funding for transportation projects around the city.

The Alexandria Chamber of Commerce and the Del Ray Business Association have both voiced opposition to the add-on tax, though the city will reduce some business taxes.

The real estate tax rate is advertised at $1 per $100 of a property’s valuation. The 2012 budget proposal submitted last month by City Manager James Hartmann listed a rate of 97.8 cents per $100 of valuation.

The measure passed 5 to 2, with council members Frank Fannon and Alicia Hughes casting the dissenting votes.

Vice Mayor Kerry Donley said the increase could give the council some flexibility as it works through the budget process, particularly with the public school system’s capital improvement plan.

A public hearing on tax rates is scheduled for Apr. 16, with a second reading and final passage by council set for May 2.