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It’s crunch time for Staunton’s budget decision-makers, and for anyone looking at the big picture, it doesn’t look good.
Last year’s budget came with a 2-cent increase in the real estate tax rate, but even that small bump prompted some push-back from city council member Jeff Overholtzer, who worried about its impact on lower-income homeowners. So this year, perhaps wanting to avoid stiffer resistance, city manager Leslie Beauregard is holding the line on requesting a tax increase (well, except for a 10-cent-a-pack increase on cigarette sales taxes) and instead is looking to hike water, sewer and refuse fees. The proposed fee increases will raise the average household bill an estimated $7.41 a month.
That doesn’t come close to what’s actually needed, guaranteeing a much more expensive reckoning down the road.
To understand the financial sinkhole lying in front of us, it helps to think of Staunton as a 100-year-old house. It’s got great bones and period architectural details, but a lot of crucial maintenance has been deferred and it’s starting to show. With an actual house, that might mean a roof that’s been leaking long enough to create a mold problem, or plumbing that gets stressed every time the ancient furnace kicks in. With a city like Staunton, it means corroding water and sewer lines. A smart home-buyer who acquires such a vintage Victorian will budget anywhere from 5% to 10% of his purchase price, annually, to address the issues he’s inherited. Staunton, by contrast, puts aside just 1.8% of general fund revenues for its capital improvement plan (CIP).
Much of the CIP, it should be noted, goes not for maintenance of existing infrastructure but for expanding what’s already there, such as the $10 million projected for extension of water and sewer lines to Uniontown. But maintenance is hellishly expensive. Replacement of the existing water mains along Richmond Avenue, from Frontier Drive to Greenville Avenue, is expected to cost more than $13 million. Upgrading of existing sewer lines will cost an estimated $7.5 million. And replacing the 16” mains that bring water into the city, now a hundred years old, will cost $42 million or so—$42 million that is carried in the budget as an “unfunded” expense. Which is to say, no one has figured out yet where that money will come from.
The $42 million “unfunded” expense aside, it’s not the least bit clear how Staunton will pay for any of the other infrastructure repairs just mentioned, nor additional millions in other needed maintenance. As the city manager forthrightly acknowledges, existing capital fund balances and projected inflows won’t come close to covering projected costs. Indeed, the fund used to pay for Staunton’s share of the regional landfill is “in danger of becoming insolvent,” while three needed positions in the public works department to properly service water and sewer operations have been frozen since 2023. (Although if they were ever thawed, good luck finding decent job applicants for a starting wage of just $17.37 an hour.)
Okay. That’s the expense side of the books. What about the income side? Why doesn’t Staunton have the income it needs to meet its expenses?
Part of the problem is that the city has a history of presenting itself as a low-tax, affordable place to live, unburdened by the socialist pretensions of its bigger brethren, which is why Staunton is so far behind the eight ball in addressing its housing needs. Almost half of its revenue is from general property taxes, but despite some city residents feeling they’re already over-taxed, Staunton’s property tax rates—91 cents for real estate, $2.90 for personal property—are among the lowest of all of Virginia’s 38 cities. At the end of 2024, for example, Lexington had rates of 92 cents and $4.25, respectively, while Harrisonburg was at $1.10 and $3.45, and Winchester was at 83 cents and $4.80. Waynesboro, meanwhile, raised its real estate tax to 89 cents (from 77 cents!) at the same time Staunton bumped up its rate, but had a personal property tax rate of $3.25. Only five Virginia cities had lower personal property tax rates than Staunton last year, and until last year, only seven of them had lower real estate tax rates.
So purely on a comparative basis, Staunton has room to increase its property taxes, no matter how worrisome that may be for some. But Staunton is further hobbled by another conceit, which is not only that it’s a low-tax haven but that its utilities are self-supporting enterprises like those found in the private sector, such as Dominion Power or Columbia Gas. Indeed, as explained to city council in a presentation March 12, Staunton’s water, sewer and trash collection services are supposedly supported by user fees, not local tax dollars. “Revenues must be sufficient to operate the system and invest in infrastructure without relying on general tax dollars,” according to Staunton’s chief financial officer, Jessie Moyers.
Except, of course, that they’re obviously not.
A small but growing number of Staunton residents are waking up to the crisis that is building up around them, with the recently released 2026 American Community Survey showing a 9% decrease in public perception of “the overall quality of utility infrastructure,” matched by a 9% increase in respondents wanting to see the city give the issue a higher priority. But that concern is scarcely touched by the budget proposal now under consideration. While leaving the general fund and its CIP untouched, the 2027 budget nibbles around the edges of the infrastructure problem by proposing utility fee increases that will raise just $517,000 a year in additional revenue from water and sewer customers. At that rate, Staunton will accumulate enough money to replace those 16” mains by the year . . . 2107.
Not only do the proposed fee increases fall far short of what’s needed to maintain infrastructure without relying on tax dollars, but they’re so timid that if adopted, Staunton would still have the lowest utility rates around. A Staunton household using 9,000 gallons over two months, for example, would have a water bill of $48.72, compared to $73.81 for a Waynesboro household and $76.53 in Augusta County. Similarly, the Staunton bill for 9,000 gallons of sewage would run to $67.20, compared with $119.20 in Waynesboro and $121.02 in the county.
Everybody loves a good bargain, but these are illusory savings—the equivalent of eating your seed corn. Whether the city council understands it’s being asked to kick a fiscal can down the road, with even more dire news awaiting future council members, may be evident this Thursday at city hall: the city council work session (open to the public) starts at 5:30 p.m. and will be followed by the regular meeting at 7 p.m. The 2027 budget and the proposed fee increases are on the agenda.
Next up: is there any way for cities to break out of their fiscal strait-jackets?
Looking askance 