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Fairfax County officials are preparing to strengthen the county’s financial reserves as federal job and funding cuts create uncertainty across the region.
County staff have recommended placing an additional $2.4 million into reserves. Another $8.1 million could also be set aside or directed toward other priorities.
“We continue to be conservative,” Department of Management and Budget Director Phil Hagen told the Board of Supervisors’ budget policy committee on March 25.
The money comes from additional revenue expected after the third quarter of fiscal year 2025 ends March 31. Supervisors will decide how to allocate it in May while finalizing the county’s fiscal 2026 budget.
The current budget, which runs through June 30, has benefited from lower expenses in some areas and stronger-than-expected interest earnings from county investments. Departments have also recorded savings, including reduced overall spending on employee fringe benefits.
Those gains are partly offset by retiree health care expenses that are running $5.6 million above projections, driven especially by prescription drug costs.
Hagen said staff favor adding to existing contingency funds because of uncertainty surrounding the regional economy and its broader stability as the Trump administration continues cutting federal employment and funding.
Braddock District Supervisor James Walkinshaw supported that approach, urging the board to consider setting aside as much of the available balance as possible when it makes its final decision in early May.
The county’s proposal follows a similar move at the state level. Virginia Gov. Glenn Youngkin proposed adding money to a rainy-day fund to prepare for a possible economic downturn in an amended budget bill released March 24.
County staff have also proposed using additional third-quarter revenue for several projects and programs:
- $14.3 million for urgent facility repairs and upgrades
- $8.9 million for information technology infrastructure
- $5.3 million for the Fairfax County Park Authority, largely for recreation center repairs and improvements
- $1.6 million for additional vehicle replacements
- $900,000 for a countywide event commemorating the nation’s 250th anniversary in 2026
- $100,000 for Volunteer Fairfax, which has experienced declining fundraising
The plan would also convert 30 existing jobs into merit-based positions with full benefits without requiring additional funding. Of those positions, 27 are within the Fairfax-Falls Church Community Services Board, which provides mental health services, and three are in the Park Authority.
Residents can comment on the proposal during annual budget hearings scheduled for April 22 through April 24.
Board Chairman Jeff McKay said staff will finalize their third-quarter recommendations three weeks later, after receiving updated figures. Supervisors are scheduled to approve the review while marking up the fiscal 2025 budget on May 6, followed by formal adoption of the new budget on May 13.