City/County Revenue Sharing 101 - The Annexation and Revenue Sharing Agreement between Albemarle County and the City of Charlottesville

Although the issue of revenue sharing came up during last year's budget discussions, it's back in fuller force this year as Board of Supervisor's chairman Ken Boyd has questioned some of the assumptions underlying the agreement.

The Annexation and Revenue Sharing Agreement was adopted by Charlottesville & Albemarle in 1982 due to Charlottesville’s threat to annex a large amount of Albemarle’s tax base (see the county's executive summary here).

How does it work? In return for the promise by Charlottesville not to annex our land (i.e., tax base), Albemarle pays a lump sum to Charlottesville every year based partially on our tax base.

Although state law later prohibited cities from being able to annex land from counties, the Revenue Sharing Agreement did not go away and remains in place today.

This year, the Revenue Sharing Agreement will result in a lump sum payment to Charlottesville of $13.6 million.

The Agreement (Section V) required Charlottesville and Albemarle to study the consolidation of services, such as fire and rescue emergency services. Nothing came of that effort.

Today--26 years later--there are no ongoing discussions about consolidating services. Yet Albemarle has paid Charlottesville over $600,000 per year for the last seven years for emergency services—and is considering to do so for another five years!

Why is Albemarle paying Charlottesville for services that should have been combined under the Agreement’s original intent?

Let’s ask the Albemarle Board of Supervisors to discuss in good faith with Charlottesville the consolidation of services—thereby making better use of our tax dollars!