Manassas Cut Its Tax Rate and Bills Still Went Up: How Data Centers Change What a Home Costs to Own
October 15, 2026
October 15, 2026
How does a city lower its real estate tax rate in the same year the average homeowner's tax bill goes up by nearly $300? In Manassas, both happened in fiscal year 2027, and data centers are part of the reason.
Here is the short version. In 2026, data centers drove record growth in the City of Manassas's commercial tax base, and Council cut the tax rate by two cents. Home values rose fast enough to more than cancel that cut. Separately, the city-owned electric, water, and sewer utilities raised rates on July 1, 2026, and city forecasts show more increases each year through FY2030. If you're comparing Manassas with neighboring areas, the rate on a listing sheet tells you the least about your total cost.
City Council adopted the FY2027 budget on May 11, 2026. The new real estate rate is $1.24 per $100 of assessed value. That breaks down into $1.05 for the General Fund and $0.19 for the fire and rescue levy, and it is two cents lower than FY2026's $1.26. The signed tax ordinance took effect June 8, 2026. Five members voted for it, and Councilmember Theresa Coates Ellis voted against. Potomac Local reported that Ellis had proposed using contingency funds to bring the rate down to $1.23. That motion failed, and she argued residents needed relief sooner.
According to the city's adopted budget executive summary, the average residential assessment is now $486,941, not counting new construction. The average tax bill is $6,038, up $289, or 5.03%. With new construction included, the average bill is $6,061, up $312. The Prince William Times explained the cause when the budget was proposed: home values rose 7.3%, which outweighed the two-cent cut.
Data centers drove the tax base growth behind the budget. When City Manager Steve Burke presented the proposal, he said real estate values had grown by $995 million in one year, with $461 million of that from new construction. He called it "historic growth." New industrial construction alone added $428 million in value, up 76.8%. Burke tied the biggest gains to the Brickyard data center coming online and to construction of the Dean Drive data centers. He said those gains moved 3% of the real estate tax burden off residential property and onto non-residential property.
So data centers did lower homeowners' share of the city's tax revenue. They did not lower the bills homeowners actually pay. The budget summary projects real estate tax revenue rising 9.78% including new construction, even at the lower rate.
Not every data center pays every data center tax. The city's FY2027 personal property ordinance taxes computer equipment and peripherals used in a data center at $4.50 per $100 of assessed value, compared with $2.15 for programmable computer equipment used in other businesses. Both are well above the $1.24 real estate rate. Digital Realty's 185,000-square-foot facility opened at 9905 Godwin Road, on the former Glen-Gery Brickyard site. The Prince William Times reported that because its tenant is a bank, the building is not subject to the city's computer and peripheral taxes. The city still expected about $1.1 million in real estate taxes from it in 2026. At the time, the paper counted five more data center projects underway within city limits.
Each data center adds different revenue depending on its tenant and equipment. The city's growth in assessed value is real, but nobody should assume every new facility will push the residential tax rate lower.
This is where Manassas differs from most of Northern Virginia. The city runs its own electric, water, and sewer utilities, so Council votes on those rates each year in the same budget cycle as the tax rate. The FY2027 utility ordinance passed 6–0 and took effect July 1, 2026. It raised electric rates 10.5%, water 9.5%, and sewer 3%. A consultant had recommended a 25% water increase, but the city adopted the lower figure. When the budget was proposed, the city estimated the combined increase at about $15.76 a month for a typical household. It said that number could change once the rate study was finished.
Electric rate history shows how quickly this has changed. In the city's budget presentation, electric rates held at 0% every year from FY2018 through FY2022. They then rose 2%, 4%, 5%, 6.5%, and now 10.5%. The same presentation forecasts the next three years:
| Fiscal year | Electric | Water, budget path | Water, consultant path | Sewer |
|---|---|---|---|---|
| FY2027, adopted | 10.5% | 9.5% | 25% | 3% |
| FY2028 forecast | 10% | 15% | 25% | 3% |
| FY2029 forecast | 10% | 15% | 10% | 3% |
| FY2030 forecast | 5% | 15% | 5% | 3% |
The city stresses that rates are set every year and that these forecasts are estimates it keeps revising. The percentages also leave out pass-through charges like the Electric Power Cost Adjustment and the UOSA sewer treatment costs. Even so, the city's own forecast shows increases in every utility each year through FY2030.
City documents say two things that are hard to square. The Council budget presentation says:
All utilities costs for a data center are paid for by the data center. There is no negative impact to the ratepayer or the rates. Data centers also pay an electric surcharge and tap fees.
The same presentation blames the electric increase on higher costs for equipment, transformers, and cables. But the budget summary lists "increased electrical purchase from Dominion for the data centers" as one of the biggest reasons spending went up. The electric fund grows from $52.8 million to $87.7 million, an increase of 66.1%.
The rate ordinance shows how the city intends to keep these costs separate. It doesn't classify customers by industry. It sorts large users by service voltage and demand. Transmission-voltage customers must be above 6,000 kW at 69 kV or higher. Customers on that tariff repay the city for:
The two statements may both be accurate. The city can buy far more power on behalf of data centers while billing those costs back to them. Still, none of the materials reviewed here explains how the two connect. The city also says the data center surcharge "could result in future rate stabilization." That is a possibility, not something the forecast already includes. According to Potomac Local's coverage of the May budget hearing, residents who spoke raised concerns about taxes, utilities, the pace of development, and future demand on electricity and water.
Prince William County adopted a base rate of $0.865 per $100 for FY2027, down from $0.906. The county stated that the average residential tax bill would fall by $56. The county also charges a separate $0.070 fire and rescue levy in most areas, plus small special district levies in certain locations. Manassas is an independent city, so its homeowners pay the city's rate instead of the county's. The two rates fund different services and can't be compared directly. What can be compared is the direction: the average county bill went down this year, and the average city bill went up $289.
The housing market isn't separating the two. The Prince William Association of Realtors reports Prince William County, Manassas, and Manassas Park together. Its August 2026 report showed a median sold price of $588,000, up 4.1% from August 2025. Active listings rose 19.5% to 1,026. Median time on market was 25 days, with 2.8 months of supply. That combined median includes homes paying both tax rates and two different utility setups. A buyer looking at a city home and a county home at the same price could face meaningfully different yearly costs.
On August 23, 2026, the Manassas Journal reported that BlackChamber Partners had reportedly bought about 12 acres between Dean Drive and Manassas Church of the Brethren at 10047 Nokesville Road. The paper found no public record of a planned project's size, power demand, water use, operator, or schedule. The parcels were not on the city's list of rezoning and special use permit applications under review, and the Journal said the land purchases do not amount to approval of another data center. The city has already built the infrastructure for this corridor. Its Electric capital plan reports a completed AWS/BCG substation and a relocated Lockheed substation, part of a system with six substations and an annual peak load of 140 MW.
Each new facility affects two things a homeowner pays. It can add commercial value that eases pressure on the tax rate. It also adds load to the utility the homeowner gets billed by.
Does a lower Manassas tax rate mean a lower tax bill? Not in FY2027. The rate fell two cents, but a 7.3% rise in home values raised the average residential bill by $289, to $6,038.
When did the new utility rates start? The FY2027 electric, water, and sewer rates took effect July 1, 2026. Utility history from before that date reflects the old rates.
Do the market statistics separate Manassas from the county? PWAR's monthly reports combine Prince William County, Manassas, and Manassas Park. Its August 2026 report, published September 11, was the most recent available when this was written.
When you compare Manassas with nearby areas, a property's true yearly cost includes the tax bill and the city utility bill, and both are changing quickly right now. Barnes Real Estate Company can help you work through those numbers for any specific property, and if you own in the city and want to see how today's assessments compare with market value, start with an instant home valuation.
This article is general information, not legal, tax or financial advice. Consult a qualified professional about your situation.
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