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Civic Federation thinks county government needs to tighten belt

Tax burden on some residents is reaching an untenable place, organization believes
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There won’t be a new-for-2024 resolution on the subject, but the Arlington County Civic Federation remains concerned about the ever-increasing tax burden on local residents.

A March discussion of County Manager Mark Schwartz’s proposed $1.6 billion fiscal 2025 budget brought “a general sentiment that we should reduce taxes” while funding core government services, the federation noted in its April membership newsletter.

Schwartz’s budget proposes a 1.5-cent increase in the county’s real-estate tax rate. The County Board went further, advertising a maximum increase of 2.5 cents, which if implemented in full would increase the rate to $1.038 per $100 assessed valuation.

(Complicating year-over-year comparisons is the fact that, in 2024, charges for stormwater costs will be shifted from a tax based on the value of properties to a fee based on the impermeable surface of lots. From a cost perspective, some residents will fare better, some worse, under the change.)

Each 1-cent increase in the real estate tax rate removes about $9.1 million from the pockets of taxpayers and shifts it to the county-government coffers, said Suzanne Smith Sundburg, who chairs the Civic Federation’s revenues-and-expenditures committee.

In the April newsletter, Sundburg said Schwartz had failed to identify enough potential budget reductions to maintain a stable tax rate.

“Had the manager identified spending cuts equal to $38.6 million, as originally planned, he could have funded all of the new spending he said is needed in FY2025 without having to raise the tax rate – and still have had money left over,” she wrote.

Sundburg also was critical of Schwartz for his unwillingness to eliminate staff positions that are unfilled, while also adding more than 200 positions to the workforce during the COVID era.

While the general sentiment among active Civic Federation delegates may be to maintain or decrease the tax rate, federation president John Ford said there would be no formal resolution developed and voted on to address the matter this cycle.

“The [March] budget discussion began by citing the Civic Federation’s resolution of April 2022 calling on the [County] Board and manager to take into account the effective tax rate on county residents – especially vulnerable populations and businesses – to balance any new spending with mitigation of the growing tax burden,” he told the GazetteLeader. “This resolution has not changed and still stands.”

For more than two generations, Arlington leaders have relied on an influx of tax revenue from commercial office buildings and retail spaces to offer what they have touted as “world-class” services while keeping the tax burden on homeowners lower than it might have been.

But with the changes in the office-leasing market since COVID, that golden goose has turned into something of an Achilles’ heel, as the county government’s addiction to big spending now more and more must be paid for through spiraling real-estate taxes on residential properties.

Cynics suggest that may be the key driver behind the “Missing Middle” upzoning taking place countywide – more houses mean more tax revenue, after all.

But there is one fault in that theory: Anyone moving into Arlington with children in tow ends up being a net drain on the local government, as the costs of education likely would outstrip the property-tax revenue involved. (Homeowners without school-age children are a net financial plus for the county government, however.)

The fiscal 2025 budget process is rolling on, with County Board members slated to adopt the spending plan and set tax rates in coming weeks. While the government’s budget cycle runs on a July-to-June fiscal year, tax rates are for calendar years, payable in equal spring and autumn installments.