The rise in property values in Arlington is accelerating post-HQ2.
Late last week Arlington County announced that its assessments for 2020 had risen 4.6% on average — 4.9% for commercial properties and 4.3% for residential properties. That compares to an average property assessment increase of 3.5% last year.
The rise in property values will almost certainly mean a rise in property taxes for Arlington residents. The county, in its announcement, seemingly discounted the idea that tax rates — currently $1.026 for every $100 in assessed value — would come down to offset the rising assessments.
“Although the growth will result in additional revenue, the County faces continued funding choices in the coming fiscal year,” the county’s press release says in the first paragraph. In November the County Board directed County Manager Mark Schwartz to propose a budget that either keeps the tax rate steady or slightly lowers it; his budget proposal will be released in February.
The county says Amazon’s arrival is at least partially responsible for rising property values, though apartment buildings accounted for much of the commercial assessment increases.
Commercial property values were driven by a decline in the office vacancy rate, continued new construction, demand for rental properties, and Amazon-related leasing activity. Apartment property values increased by 8.9 percent, office values increased by 2.5 percent, and general commercial property (malls, retail stores, gas stations, etc.) grew by 1.8 percent.
“Arlington continues to be a place where people want to live and work,” Schwartz said in a statement Friday. “The investment we make in our community through real estate tax revenue helps us maintain the high-quality amenities and public services that make Arlington so attractive.”
The full press release is below, after the jump.
New Taco Restaurant Eyeing Arlington — Wild Tacoz, which recently opened in the Falls Church area, is aiming to become a local chain with future locations in Arlington and elsewhere. [Tysons Reporter]
Pedestrian Struck Near Clarendon — “A woman was just struck by a car on N. Pershing Drive at Fillmore Street in Lyon Park. Only minor injuries reported. Police and firefighters on scene.” [Twitter/@ARLnowDOTcom]
Dems Push for Higher Wages at DCA — “Delegates have signed a letter urging the Metropolitan Washington Airport Authority to ensure contracted workers at Reagan National Airport and Washington Dulles International Airport reach $15 per hour by 2023. Their $12.15 hourly wages are far lower than D.C.’s $15 minimum wage and many East Coast airports.” [Press Release]
Crystal City Hilton Sold — “Starwood Capital Group has made its second acquisition in the area around Amazon HQ2 this year. The Miami-based firm acquired a 393-room hotel in Crystal City from a fund affiliated with JBG Smith for $73M.” [Bisnow, Washington Business Journal]
Housing May Dominate Budget Discussion — “Board members directed, as part of their fiscal 2021 budget guidance to County Manager Mark Schwartz, that budget plans include an option to increase affordable-housing funding to as much as $25 million, a 56-percent increase from the $16 million Affordable Housing Investment Fund (AHIF) funding approved for the current fiscal year…. [but] raising expectations of affordable-housing advocates could pit them against proponents of other budget priorities.” [InsideNova]
Local Defense Attorney to Serve as Fairfax Prosecutor — “Fairfax County Commonwealth’s Attorney-elect Steve Descano… announced last Wednesday (Nov. 27) that he intends to have Terry Adams, a private defense attorney in Arlington, take on the role of Chief Deputy, lauding his 14 years working on criminal and civil cases in Virginia.” [Tysons Reporter]
ACFD Assists With School Project — “Tower 104 assisted students [at] Science Focus School today with their annual egg drop. The students were able to collect some data & a good time was had by all.” [Twitter/@ArlingtonVaFD]
Photo courtesy Dave Statter
(Updated at 12:05 p.m.) The Arlington County Board is asking the County Manager for a budget that contains no property tax rate hike and maybe even a rate cut.
Members gave their Fiscal Year 2021 guidance to County Manager Mark Schwartz at last night’s recessed Board meeting.
The guidance for reducing the tax rate or keeping it steady will likely not, however, result in lower tax bills, as property assessments are expected to continue to rise in the wake of Amazon’s arrival. The average real estate assessment is expected to jump 4-6 percent next year.
A budget forecast paints a rosy picture of Arlington’s post-HQ2 economy, with business tax revenue expected to grow as well, though budget pressures of Metro, county employee compensation, needed stormwater improvements and flood mitigation, and a growing school population remain.
The Board also took action last night on the affordable housing front, asking the manager for options that could hike the county’s annual Affordable Housing Investment Fund contribution to as high as $25 million from the current $16 million. Additionally, the Board largely accepted Schwartz’s recommendation to carryover unspent funds from the last budget to the new budget and to reserve funds, but set aside $500,000 for emergency housing assistance.
“The Board understands that anticipated increases in property assessments could have a real impact on residents,” Arlington County Board Chair Christian Dorsey said in a statement. “We want the Manager to come back to us with a proposed budget with no increase in property tax rates and to consider a reduction in the tax rate if possible. Our guidance to the Manager also emphasizes the need to invest more in preserving and creating affordable housing in Arlington, including housing affordable to extremely low-income families.”
The manager will present his proposed FY 2021 budget in February, after a months-long public budget process, which will then continue through the Board’s budget adoption in April.
More from an Arlington County press release, after the jump.
Dorsey Declares Bankruptcy — “Arlington County Board Chair Christian Dorsey, who was penalized Thursday for failing to disclose a campaign contribution to the Metro board in a timely manner, filed for bankruptcy last month after falling behind on his mortgage and accruing tens of thousands of dollars in credit card debt… he attributed his personal financial troubles to a drop in income since he was elected to the five-member Arlington board four years ago.” [Washington Post]
Metro Delays During AM Rush — “Blue/Yellow Line Delay: Single tracking btwn Braddock Rd & National Airport due to a signal problem outside Braddock Rd.” [Twitter]
Arlington Among Best Cities for Frugal Dating — Arlington is No. 17 on a new list of “the best cities in the country for budget-friendly dating.” [SmartAsset]
County Aiming for More Budget Feedback — “This week marks the beginning of the FY 2021 budget season, Arlington County’s process to decide how it will spend County dollars. From now through July 2020, you will have multiple opportunities to provide input and inform decisions about the County’s operating budget and capital budget.” [Arlington County]
County Football Teams May All Make Playoffs — “Depending on the outcome of final regular-season games on Nov. 8, there is a possibility that the Wakefield Warriors, Washington-Liberty Generals and Yorktown Patriots could all end up as district football champions. Wakefield (5-4, 4-0) and Yorktown (8-1, 4-0) are in sole possession of first place currently in the National and Liberty districts, respectively, and are guaranteed at least co-championships if they lose Nov. 8.” [InsideNova]
Yorktown Field Hockey in State Tourney — “It took a while, but when the stakes became the highest, that’s when the Yorktown Patriots started playing their best field hockey of the 2019 campaign, in what has become an historic season for the girls team… By reaching the region final for the first time in program history, Yorktown also earned a Virginia High School League Class 6 state-tournament berth, also for the first time.” [InsideNova]
DJO Runners Win State Title — “After not winning the state championship the past two seasons, the Bishop O’Connell Knights have returned to that throne this fall. The girls high-school cross country team won the 2019 Division I state private-school crown Nov. 7 in Mechanicsville by dominating the field with 46 points.” [InsideNova]
Nearby: Potomac Yard Plan Takes Shape — “Just a few days after submitting plans for the Virginia Tech site near the North Potomac Yard Metro station, JBG Smith has submitted early concept designs for the development that will replace Target and the other Potomac Yard stores.” [ALXnow, Washington Business Journal]
During the Arlington County Board meeting on Tuesday, County Manager Mark Schwartz recommended allocating the leftover funds across three categories:
- $14.4 million set aside for FY 2021 budget deliberations
- $6.8 million towards the Economic & Revenue Stabilization Contingent
- $2 million for the County Manager Operating Contingent
Reserving $14.4 million for unallocated funds would give “the county some flexibility when weighing its future budget choices for FY 2021,” according to county budget director Richard Stephenson.
Staff said $6.8 million Schwartz recommended for the county’s reserve fund is important for maintaining Arlington’s high bond ratings. If approved, these funds would increase the county’s contributions to its reserve from 0.5% to 1% of the total operating budget.
“Bond ratings serve as an indicator of the county’s resiliency and ability to weather economic downturn and unusual catastrophic events,” said Maria Meredith, director of Arlington’s Department of Management and Finance, during Tuesday’s meeting.
The remaining $2 million for the County Manager Operating Contingent would be for addressing “unforeseen needs that arise during the fiscal year, such as contractual increases, repairs, or special projects,” said Stephenson.
“We’ve had this contingent set aside for awhile,” said Stephenson after the meeting. “For example, when Katie Cristol came on as Board Chair and wanted to start the Child Care Initiative, the money was there to do those things — without needing the redistribute the county budget.”
The $23.2 million carryover represents 2.7% of the county’s total FY 2019 budget, a slight increase from last year’s 2.6% carryover.
Until recent budget years, the Board would usually allocate its close-out surplus funds to a variety of initiatives, a practice that prompted some bipartisan criticism. Last year the Board mostly rolled over its leftover funds to the next year’s budget, while also adding to its reserves.
“We’ve done a much better job explaining the sources of these funds, and we’re getting much more responsible in [their] proposed uses,” said Dorsey.
County Board members added they welcome public comment on the issue throughout the month before they are scheduled to take action during their next meeting on Saturday, November 16.
The Arlington County Fire Department’s overtime crisis is having a ripple effect on other programs, leaving training and logistics to take a hit.
Between the 2016 and 2018 fiscal years, the department exceeded its overtime budget every year.
At a meeting yesterday (Thursday) at county government headquarters, County Auditor Chris Horton met with Arlington officials and ACFD staff to review the recent audit of the department’s chronic overtime usage and suggestions to fix it.
One area where all involved parties agreed was that the overtime was the main source of the department’s fiscal troubles.
“Overtime use in the fire department has caused budget management challenges in 2016-2018 fiscal years,” Horton said. “What we did here was to look and see if there was actual, clear evidence mathematically that it was overtime driving the overages in the budget. What we’re seeing is strongly indicative that the callback overtime — that is increasing the overruns with total personnel costs — is increasing the overruns with total department costs.”
There were several issues cited as contributing factors to the overtime overuse, but one of the main problems is insufficient staffing. According to the audit:
At the core of the budget management issues are staffing challenges ACFD experiences throughout the department, including significant attrition in ACFD Operations. ACFD has been operating with decreases in staffing that continue to result in an average loss of more than two employees per month. With the rigorous screening processes and training required for new recruits, it takes almost 12 months and costs almost $100,000 per recruit to recruit, hire and train firefighters… Therefore, ACFD continues to face struggles with deploying adequate staffing even with recent budget increases to fund additional recruit classes.
Horton and fire department officials explained that staffing is required to be maintained at certain levels, and if there aren’t enough staff on hand to meet those levels, off-duty firefighters are either called back or asked to stay past their shift to meet those staffing levels. This callback overtime — as opposed to discretionary overtime — has exceeded its budget every year the audit studied.
“It’s very difficult to be fully staffed in public safety,” said County Manager Mark Schwartz. “We have to call people back and they come back. It’s not a healthy cycle for anyone involved. Over the last three of four years, the things that haven’t been done are as much training — that’s the main thing — and logistics. The department tries to get in under budget overall but there are things that get lost in that process.”
The audit notes that cuts had to be made in expenditure categories such as training and equipment to cover overtime costs.
“To stay within our budget, sometimes we have to throttle back stuff that’s not mission-critical,” Capt. Ben O’Bryant, a spokesman for ACFD, told ARLnow. “Training we’d like to send four people to maybe we’d send three, or equipment that we’d like to put in service, maybe we hold back on that. Nothing that’s mission critical for delivery of services… but sometimes we have to adjust our activities. Anything required to provide services to the county, we get that, but sometimes we don’t send as many people to elective training as we’d like to or we hold off on getting equipment.”
A new report found the Arlington County Fire Department has been regularly exceeding its overtime budget while putting firefighters at risk of fatigue and injury.
County Auditor Chris Horton blamed staffing shortages and a lack of payroll controls for the department exceeding both its overtime budget and personnel budget over the last three years. He noted that the overtime costs ranged from $5.2 million to $6.2 million per year, despite being budgeted at $3.2-3.4 million.
Officials are expected to discuss the 40-page report during the County’s Audit Committee public meeting tonight (Thursday) at 5 p.m. in Room 311 in county government headquarters (2100 Clarendon Blvd.)
The department requires that firefighters work no longer than 60 hours in a single shift, and must take at least a six-hour break before starting new shift. However, the audit found that supervisors could override that requirement.
“The purpose of hours worked restrictions is to reduce responder fatigue, and improve safety, performance, and quality of life,” read the report. Horton recommended the department stick to its hours — as well as study whether firefighters may require more rest time between shifts.
“The commute for some personnel could be one or two hours each way,” wrote the report, noting that many firefighters live well outside the area. The report also noted a high level of sick leave could be caused by firefighters using their paid time off to catch up on sleep.
The audit issued 23 recommendations to address the time off and overtime problems, including that the create an “overarching departmental policy” on how to better monitor time off.
ACFD responded that they agreed with 20 of the recommendations. When it came to commission a staffing study, establishing better interagency communication, and budgeting for more overtime, Fire Chief David Povlitz disagreed with the need for additional resources, writing that ACFD could address those needs internally.
One reason the audit found for the unexpected overtimes expense was a lack of controls and efficient systems for payroll, which Horton noted, “creates cumbersome and inefficient processes and impairs overtime management.”
The department was within its overall $59.8 million budget during the last fiscal year, but the audit found that the unexpected overtime expenses caused the department to exceed its overall budget in fiscal year 2016 and 2017.
Horton said ACFD’s high attrition rate and recruiting struggles have contributed to the high overtime costs.
“At the core of the budget management issues are staffing challenges ACFD experiences through the department, including significant attrition in ACFD Operations,” he said. “ACFD continues to face struggles with deploying adequate staffing even with recent budget increases to fund additional recruit classes.”
Last year, firefighters joined police officers in protesting low wages, some saying the low starting pays made it impossible to live in Arlington with its rising cost of living. The county has responded to the demands by awarding 6 percent budget increases to ACFD for the last two years to raise wages and fund recruiting, but retention remains a problem: Horton noted the department loses an average of two employees every month.
Now, the county is aiming to hire 36 more firefighter and EMTs by 2022 to alleviate the workload of the department’s remaining employees.
Three months ago, Horton also found that the Arlington County Police Department had exceeded its overtime budget for the last three years. The auditor found that ACPD reported $5.46 million in overtime last year — twice the amount allocated in the department’s budget.
Povlitz noted that because “there are some similar findings between the Police and Fire Department Overtime Audits, all public safety agencies are planning process changes by utilizing a newly staff public safety time and attendance administrator position.”
County Manager Mark Schwartz said in a statement today (Thursday) that “the real message here is that we need a better and updated financial system.”
Table via Arlington County
The Right Note is a weekly opinion column. The views and opinions expressed in the column are those of the author and do not necessarily reflect the views of ARLnow.com.
If you are having trouble scrubbing the family budget enough to help pay for the rising tax rates here in Arlington, try this solution: just raise your salary.
That is apparently what the Arlington County Board plans to do this month.
This is not just any old cost-of-living adjustment mind you, but a raise that could be more than 40%. Libby Garvey speculated the pay could rise from around $57,000 to $82,000.
To put $25,000 into perspective, it would take this year’s tax increase on roughly 60 average homeowners to fund one Board Member’s pay raise. It would take more than 300 homeowners to fund the raises for the entire Board.
One could reasonably argue that from time to time the County Board should adjust its pay upward to reflect the hours they work and inflation. This post is not necessarily about what is reasonable, though $25,000 seems clearly beyond reasonable for what is supposed to be a part-time Board. Instead, it addresses the dishonesty of the arguments from our elected officials and the timing of the vote.
Let’s go back all the way to January. That is when Arlington County Board Chairman Christian Dorsey said about a pay raise, “I don’t actually think it’s appropriate this year.” The comments came in the context of the so-called “tight budget times” that the Board claimed necessitated a 5% tax increase on homeowners for 2019.
Dorsey’s words were clearly designed to make Arlingtonians think he and the Board wouldn’t dream of considering a raise as they were asking taxpayers to fork over more of their hard-earned money to the five spendthrifts. And the Board proceeded to go through the annual budget process without discussing a pay raise as part of that package.
It is clear what Chairman Dorsey actually meant was, the right time to vote on a pay raise is after the deadline for candidates to get on the November ballot. Pushing the pay raise consideration till late June was presumably aimed at avoiding the looming threat of a John Vihstadt run.
The willingness to even consider the pay raise proves that any claim that Arlington is struggling with “tight budget times” is a complete and total sham. If the 6.3% budget increase passed in April didn’t convince you, the County Board’s willingness to turn around and vote themselves a pay raise as high as 44% should.
If the Board wanted a pay raise, the honest, accountable and transparent thing to do would have been to put it in the annual budget. Let the public weigh in on balancing priorities between a pay raise for the Board and cuts to arts funding, transportation needs or additional school spending.
The County Board is emboldened. They clearly believe you have written them a blank check to do absolutely anything they want with no electoral consequences.
Chairman Dorsey should go back and revisit his own words. It is not the right time to consider a massive pay raise. The Chairman should publicly commit not to put it on the June agenda. Otherwise, taxpayers may need to think about rallying around a challenger to defeat him.
Mark Kelly is a 19-year Arlington resident, former Arlington GOP Chairman and two-time Republican candidate for Arlington County Board.
Arlington County Board members announced they were considering giving themselves a raise in the coming year, pending input from residents.
Vice Board Chair Libby Garvey broached the topic during the Tuesday night meeting, saying she’s “concerned increasingly about the level of salary” that the county currently offers to Board members, and she intends to ask the public what they think.
Garvey highlighted the dozens of local and regional group meetings that members attend, saying, “I talk to people about how we’re a five-member basketball team with no back-ups so we have to play the entire game all the time.”
Serving on the County Board is intended to be a part-time position, though in practicality the schedules of Board members leave little time for other jobs.
County Board members currently earn $55,147 annually, while the Board Chair earns $60,662. Garvey noted that was lower than the county’s actual salary cap of $57,337 for members and $63,071 for the Chair.
“At some point we’ll publicize very soon some mechanism to collect feedback from our community about raising County Board member salaries,” said Board Chair Christian Dorsey.
Board member Matt de Ferranti supported the idea. “To have a great community you need the ability for everyone to serve and it shouldn’t be that some folks can serve and others cannot,” he said, referencing current salary levels in relation to the local cost of living.
“It kind of boils down to what kind of County Board we should have,” said Garvey.
Garvey said Board members are required to wait to raise their pay caps until at least two members are running for re-election. This means members would have decide by July 1 of this year whether to give themselves a raise, or otherwise wait another four years.
During her presentation Tuesday night, Garvey shared a graph comparing County Board’s salaries with other neighboring jurisdictions.
Her graph stated that D.C. Council members earn the most in the area at $140,161 annually, but recent records indicate council members actually earn $141,282 and are currently allowed to work additional jobs, although recent scandals mean some are reconsidering that provision. The Council Chairman currently earns $210,000 annually.
The second highest pay rate is for Montgomery Council members, who earn between $139,119 and $153,031 a year, according to the most recent 2018 data.
Next is Fairfax County, where Board members earn $95,000, while the Chairman earns $100,000.
Garvey noted that Loudoun County and Alexandria both pay their local legislators less than Arlington.
Alexandria recently bumped City Council member’s pay from $27,500 to $37,500, and Loudoun increased pay two years ago to $50,000 for the Chair of the Board of Supervisors, $45,320 for the Vice Chair, and $41,200 for the other members, with more raises promised in 2020.
“It’s an uncomfortable thing, that we are the only ones who can increase Board member salaries,” said Board member Katie Cristol, who described asking the public about a salary bump as a “slightly awkward consideration.”
“Short of putting this formally to a vote of every single one of our 230,000 bosses, I think at least asking for folks’ input is an excellent idea,” she said.
The Arlington School Board unanimously passed a $669.5 million budget Thursday night.
The budget includes funding for Arlington’s continually expanding school enrollment, with 1,000 more students expected to attend class in the county next year alone. Members also approved a $10.7 million pay increase for Arlington Public Schools staff and funded a study to evaluate salary structure ideas for the future, such as using cost-of-living adjustments instead of discretionary “step” increases.
Arlington Education Association President Ingrid Gant, whose organization represents APS employees, pushed for the increase during a Board hearing on Tuesday, telling members, “it is embarrassing, it is appalling, it is downright disrespectful that members of the School Board want educators to give their all… yet we only give them crumbs come budget time.”
The School Board had previously marked up their own version of a draft APS budget. On April 12, all members, save Barbara Kanninen who abstained, approved a $669.3 million APS budget. Board members hailed the newly-approved final budget and thanked the County Board for a tax hike that will provide additional revenue for the school system.
“It’s clear that this community cares deeply about education and the future of our schools, and we thank the families, students and employees who participated,” Board Chair Reid Goldstein said of the many budget meetings over the last two months.
Goldstein said the County Board, which unanimously passed a budget that includes a two-cent property tax rate hike, helped APS close $6.7 million budget gap that School Board members originally said they couldn’t close without making unpopular cuts. The gap was smaller than the $43 million gap County Manager Mark Schwartz initially feared APS would face come fiscal year 2020.
Arlington County has a new budget and a higher real estate tax rate.
The County Board unanimously approved a $1.4 billion budget for Fiscal Year 2020, avoiding the most controversial of its proposed cuts while hiking the taxes paid by the average homeowner to $9,023, an increase of $281.
Arlington property owners will now pay an additional two cents for every $100 in assessed property value, on top of increasing property values. Most of the additional revenue will go to Arlington Public Schools, which is set to receive $532.3 million in local tax dollars, which will help it also avoid some proposed, controversial cuts.
County Board members characterized the budget as fiscal prudence, despite the tax hike. They noted that it includes $4.8 million in county budget reductions, trimming 27.5 full-time staff positions deemed to be no longer necessary due to declines in demand for certain services.
The cuts range from a 5 percent reduction in funding for community radio and public access TV operator Arlington Independent Media to cutting Arlington Transit bus service on a route that records as few as 3 riders per hour.
“I would think about this not as government getting smaller, but as government getting smarter,” said County Board Chair Christian Dorsey.
Board member Erik Gutshall said county leaders went over the budget with a “fine tooth comb” and the result is a budget without “an ounce of fat.”
“We certainly would prefer not to raise rates at all but this is a budget we can be proud of as thoughtful, progressive, and sound,” said Board member Matt de Ferranti.
While the Board restored a pair of arts positions — cuts that would have affected theater programs in the county — it asked the County Manager to study those positions and the county’s arts programs in general prior to the next annual budget. Vice Chair Libby Garvey said that libraries should also be studied.
“[I’m] hoping in this next year… we take kind of a holistic view of libraries, and what we want libraries to be in our community, what role we want them to play,” she said.
There was hopeful talk on the dais about the effects of Amazon’s new Arlington presence.
“Happily the commercial vacancy rate is getting a little better,” Garvey said, adding that “obviously Amazon helps that a lot.”
In Arlington, roughly half of county revenue comes from commercial real estate and businesses.
The FY 2020 budget helps to shape a community “that a company like Amazon wants to come to,” said Gutshall. “And when they come they help our commercial [real estate] assessments that did the most of the work in bridging the gap this year.”
The full Arlington County press release on the budget’s passage, after the jump.