More Than Property Taxes: How Arlington Funds City Services

Arlington’s largest fund, the General Fund, supports core services including public safety, parks, libraries, and city administration. For FY25, revenue in the fund totals $336.7 million, with 74% coming from property and sales taxes. However, those revenues are declining due to factors like slower property value growth, lower-than-expected sales tax receipts, and successful property appraisal protests. A projected $25 million shortfall in FY26 follows $5.8 million in FY25 reductions and the City’s first property tax rate increase in 20 years.

The remaining 26% of the General Fund comes from utility franchise fees, service charges, fines, and lease payments—revenue sources that typically remain consistent year over year.

At $207.8 million, this is the second-largest fund. It covers water treatment and delivery for nearly 115,000 customers and wastewater collection. Funded through monthly water bills, it ensures safe, high-quality water and maintains two treatment plants and a modern water lab. Arlington has nearly 1,500 miles of public water mains and 1,260 miles of sanitary sewer mains.

This $79.6 million fund, backed by property taxes, pays principal and interest on city-issued bonds. These include voter-approved bonds for projects like recreation centers and streets. State law mandates this fund be used exclusively for debt payments.

Each month, there is a charge on your bill for stormwater. Residents and businesses pay a monthly fee based on the square feet of impervious surface, such as buildings, driveways, sidewalks and parking lots, on their property. That money goes directly into the $28 million Storm Water Utility Fund, which is like a special account dedicated to managing rainwater and protecting public and private property from flood risks.

Funded by a voter-approved quarter-cent sales tax in 2002 and reauthorized in 2006, 2010, 2014 and 2018, this $27.1 million fund helps maintain and repair existing streets and sidewalks. It cannot be used to build new roads. This frees up General Fund dollars for other uses while ensuring long-term street quality.

The Park Performance Fund is designed to help the City recover costs associated with operating its recreation and rental programs. With $16.4 million in revenue expected for FY25, this fund helps offset the $20.9 million cost of operating golf courses, recreational programs, and facility rentals. Though it doesn’t fully cover expenses, it reduces the General Fund's support for certain park programs, leaving dollars for other General Fund programs such as police, fire and 911 services.

Arlington’s diverse sports, entertainment and cultural attractions, from AT&T Stadium to the Arlington Museum of Art, help attract more than 15 million visitors to The American Dream City each year. Through hotel occupancy fees, parking fees and other tourism-related expenses, such as Convention Center meeting space rentals and catering, these visitors help generate $16.1 million for the Convention and Event Services Fund.

In Arlington, occupancy taxes, along with Convention Center revenue and $2.5 million a year in AT&T Stadium naming rights, are used to operate the Convention Center and Arlington Expo Center and promote tourism, arts and historic preservation.

Occupancy taxes are the largest revenue source for this fund. With approximately 8,400 hotel rooms, more than 200 short-term rental properties and other rental lodgings, Arlington anticipates collecting $11.4 million in occupancy taxes in FY25. State law limits how hotel occupancy taxes are used. These funds can be used to promote tourism, arts and the hotel industry, for example, but cannot be used to pay for general city expenses, such as police and firefighter salaries or to buy library materials. 

The City’s Aviation Fund is the smallest and newest revenue fund, created in FY24. This fund come from fuel sales, hangar rentals, office and suite leases, and other sources of revenue generated by the Arlington Municipal Airport and the city-owned Fixed Base Operator. Approximately 230 aircraft and 18 businesses are based at the airport, which has a national airport designation. Federal law requires that airports that receive federal assistance use its revenue for fuel taxes and other airport revenues primarily for airport-related purposes. The Aviation Fund provides approximately $8.9 million for the Arlington Municipal Airport, freeing up money in the General Fund for other city needs.