A legislatively mandated workgroup has begun examining how Virginia distributes Aid to Localities (ATL) funding through the Fire Programs Fund, launching what is expected to be one of the Commonwealth’s most significant discussions on state support for local fire and emergency services in recent years.
Created by SB 233 (Head), the workgroup is charged with evaluating whether Virginia’s current formula for distributing ATL funding continues to meet the needs of localities across the Commonwealth, particularly rural communities facing increasing fiscal and operational challenges. The Virginia Association of Counties (VACo) is participating in the workgroup alongside representatives from the Virginia Department of Fire Programs (VDFP), Virginia Municipal League, Virginia Fire Services Board, Virginia Fire Chiefs Association, Virginia State Firefighters Association, Virginia Professional Fire Fighters Association, Department of Planning and Budget, and other stakeholders.
The workgroup will meet throughout the summer before submitting recommendations to the General Assembly by November 1, 2026.
Current Formula Under Review
Virginia currently distributes approximately $49.8 million in Aid to Localities funding, with allocations determined almost entirely by a locality’s share of the Commonwealth’s population. Counties and cities receive a minimum allocation of $30,000, while towns receive at least $15,000 before the remaining funds are distributed on a population basis.
Under SB 233, the workgroup must evaluate several factors, including:
- Fiscal distress among localities providing fire services;
- Population and total square mileage of each locality;
- Fire service funding formulas used in other states; and
- Potential recommendations that more equitably address the needs of less populated and rural localities.
To frame the discussion, VDFP staff presented an illustrative example showing how incorporating land area into the funding formula using a hypothetical weighting of 70 percent population and 30 percent land area would shift funding among urban, suburban, and rural localities. The example was intended solely to demonstrate how alternative formulas might affect distributions and was not presented as a recommendation.
Balancing Equity Without Creating Winners and Losers
Discussion during the kickoff meeting highlighted one of the central challenges facing the workgroup: how to better recognize the unique service demands facing rural and fiscally stressed localities without simply redistributing limited funding away from other communities.
Several participants noted that Virginia’s fire service funding challenges extend well beyond the allocation formula itself.
Participants emphasized that the broader issue is the overall size of the Fire Programs Fund. Simply changing how existing dollars are distributed will not fully address the increasing financial pressures facing local fire and EMS agencies and suggested that recommendations to increase overall funding should also be considered alongside any formula changes.
The discussion also touched on whether fiscal distress should play a greater role in future allocations. Current analysis presented by VDFP identified more than 50 localities meeting measures of elevated fiscal distress, while stakeholders also suggested evaluating alternative fiscal stress methodologies used elsewhere in state government.
Looking Beyond Virginia
As part of its charge, the workgroup is examining how neighboring states finance local fire protection.
VDFP staff presented research on funding models used in Kentucky, Maryland, North Carolina, Tennessee, and West Virginia. These systems vary considerably, relying on combinations of insurance premium assessments, state appropriations, property tax-based fire districts, competitive grant programs, and dedicated fire protection funds. The review is intended to identify best practices that may inform future recommendations for Virginia.
Additional Issues Raised
Stakeholders also identified several additional topics for further analysis during future meetings, including:
- Whether emergency call volume should be incorporated into future funding discussions;
- The impact of federally and state-owned tax-exempt land on local fire service demands;
- Simplifying grant administration for smaller localities with limited administrative capacity;
- The treatment of local carryover funds; and
- Whether ATL funding is currently being distributed to departments that no longer actively provide fire protection services.
What’s Next
The workgroup will continue meeting throughout July and August before developing draft recommendations for stakeholder review in September. Final recommendations will be submitted to the Secretary of Public Safety and Homeland Security before being delivered to the chairs of the House and Senate committees with jurisdiction over public safety and appropriations by November 1, 2026.
VACo will continue participating in the workgroup and advocating for solutions that recognize the diverse needs of Virginia’s counties while supporting sustainable funding for local fire and emergency services. Counties are encouraged to follow the workgroup’s progress, as any recommendations could shape future state investments in one of local government’s most essential public safety responsibilities.
VACo Contact: Jeremy R. Bennett