Property Taxes Could Rise Under Proposed County Budget

County residents could see a property tax hike of up to 2 cents per $100 of assessed value after the Arlington County Board voted Saturday to advertise the possible maximum increase.

County Manager Mark Schwartz said the hike would pay for what he described as the “extraordinary circumstances” facing the board in increasing costs for Arlington Public Schools and the Washington Metropolitan Area Transit Authority.

Under the 2-cent rise, APS and WMATA would each receive half of the added tax revenue. The average tax and fee burden for residential properties would increase by around $300 a year, factoring in a rise in property assessments, while the residential property tax rate would reach $1.011 for every $100 in assessed value, the highest rate since 2001.

Board members approved the measure by a 3-2 vote, with Libby Garvey and Christian Dorsey voting against. The vote included a proposal by board member John Vihstadt to request that Schwartz explore alternative budget options if property taxes increase by only 1 cent.

But both Dorsey and Garvey criticized Vihstadt’s plan, saying it was “too late in the game” to be introducing such a proposal.

“I totally support the whole idea of exploring these alternatives, but the way we do it now by rolling it into this action, we’re changing the budget process,” Dorsey said.

Board chairman Jay Fisette said that Schwartz’s proposal is just the beginning of talks about the county’s budget.

“Today we received the manager’s proposed budget, and we set the maximum tax rates and fees that we can consider,” Fisette said. “Now the responsibility shifts to us. This is the start of the Board’s conversation with the public about priorities for fiscal 2018. For the next nearly two months, we will be scrubbing the manager’s proposed budget and listening to the community.”

The proposed $1.2 billion fiscal 2018 budget includes $759.3 million in the county operations budget, a 3.9 increase over fiscal 2017. Also proposed are increases in household solid waste rates, a water/sewer rate increase, a new accessory homestay permit fee of $60 for those who use online booking platforms like Airbnb and various parks and recreation program fee changes.

Schwartz said APS faces challenges around its growing enrollment, which he said grows by approximately 1,000 students each year. His budget would include $478.3 million funding for the school system, an increase by $11.1 million.

“Simply put, Arlington Public Schools is facing an enrollment tsunami,” Schwartz said. “Each year, they have additional students come; whether they want them or not, additional students show up and they need to be be educated.”

Metro represents another fiscal stumbling-block for the county, as well as the region at large. Currently, Schwartz said, Arlington pays 8 percent of the agency’s total operating costs, to the tune of $56 million.

Metro general manager Paul Wiedefeld proposed all jurisdictions increasing their subsidy, with its fiscal 2018 proposal asking that Arlington increase its subsidy to around $71 million.

That subsidy would be funded in part by state transit aid, staff reductions at WMATA, gas tax funding and money from the Transform I-66 project. It would leave a gap of approximately $6 million, with the additional penny of real estate tax adding $7.4 million.

The board will hold a series of budget work sessions next month, then public hearings on the budget and the tax rate on March 28 and March 30, respectively. The latter will include discussion on members’ possible pay rises. The board is expected to adopt the budget on April 22.