Arlington County is an affluent place. So affluent, in fact, that according to one analysis we are expected to get the second-lowest percentage of coronavirus stimulus checks in the U.S.
The study by the financial website SmartAsset ranked the 200 largest U.S. cities by the predicted percentage of residents who will receive the means-tested checks from Uncle Sam.
Here’s how the IRS describes who’s getting what:
Tax filers with adjusted gross income up to $75,000 for individuals and up to $150,000 for married couples filing joint returns will receive the full payment. For filers with income above those amounts, the payment amount is reduced by $5 for each $100 above the $75,000/$150,000 thresholds. Single filers with income exceeding $99,000 and $198,000 for joint filers with no children are not eligible. Social Security recipients and railroad retirees who are otherwise not required to file a tax return are also eligible and will not be required to file a return.
Eligible taxpayers who filed tax returns for either 2019 or 2018 will automatically receive an economic impact payment of up to $1,200 for individuals or $2,400 for married couples and up to $500 for each qualifying child.
SmartAsset used 2018 Census data to figure out which places will get the highest and lowest percentage of checks.
Arlington, Alexandria and D.C. all ranked in the top 10, as did four San Francisco Bay Area cities. Arlington ranked No. 2 on the “fewest” checks list.
In terms of cities getting the most checks, the top three are: 1. Hialeah, Florida; 2. Sunrise Manor, Nevada; and 3. Brownsville, Texas.
Photo by Sharon McCutcheon on Unsplash
In a bit of relief for hard-hit restaurants and hotels, Arlington County’s Treasurer says tax payments due between now and the end of April can be deferred temporarily.
Treasurer Carla de la Pava said in a statement that her office will not impose penalties and interest on late tax payments, though tax returns are still due. The decision mostly affects meals taxes, paid by restaurants, and hotel taxes, and requires payment by May 31.
More from the Treasurer’s Office:
Carla de la Pava, Treasurer of Arlington County, has determined that late payment penalty and interest will not be imposed on local taxes with a payment due date between March 13 and April 30, 2020, if such taxes are paid in full by May 31, 2020. This decision primarily but not exclusively affects Arlington County Meals, Food, and Beverage Taxes and Transient Occupancy Taxes, which would ordinarily be due March 20 and April 20. Taxpayers should still file the required returns even if they are not paying the tax until a later date. Taxpayers are encouraged to pay their taxes on time if they have the financial means to do so. Any taxes previously paid will not be refunded. Taxpayers should direct questions to [email protected]
(Updated at 2:15 p.m.) Tax and budget season is upon us. County Manager Mark Schwartz has released a recommended budget of $1.396 billion, including increased tax revenues from increased assessments and increased county expenditures.
While I will not go into specifics of this year’s budget, I would like to begin a dialogue about systemic changes that the County Board should consider in the long-run about how we levy taxes.
Have Commissioner of Revenue Assess and Collect All Taxes
Currently, the county assesses and collects taxes on real estate and the Commissioner of Revenue assesses and collects every other tax including vehicular, personal property, and business license taxes. Two-thirds of our revenues come from real estate and one-third from everything else. This means a vast majority of the tax revenue is based on assessments that their own employees determine, rather than the elected independent Commissioner of Revenue, Ingrid Morroy.
In almost every election, Commissioner Morroy has advocated for this power. The argument is that having the same people setting the budget responsible for assessments is an inherent conflict of interest, and the move would provide better transparency and customer service for those who believe they’ve been overassessed.
The Virginia Code also says that the County government should only administer assessors if the Commissioner of Revenue will not consent to doing assessments, which is obviously not the case (note: I am obviously not a lawyer, but this seems to be the intention). This is used in almost every Virginia jurisdiction as a best practice when a Commissioner of Revenue exists.
Incentivize Lower Vacancy Rates
I would encourage consideration of a vacancy tax on office and storefront retail properties. For the last several years we have made it a goal to reduce commercial real estate and office vacancy. This is prioritized because when space remains vacant, the property is assessed at a lower value and we receive less tax revenue, making it harder to provide the services that our community expects. Each percentage of vacancy represents $3.4 million in lost revenue.
Intuition might tell you that if you cannot fill a space, owners would lower their rent to attract more tenants. Oftentimes this is not the case. Property owners will intentionally leave office and retail space vacant for a number of reasons. One is to wait for a large tenant to anchor the building, and avoid the build-out costs associated with leasing to smaller businesses along with the higher overhead needed to piecemeal tenants together. Another is that vacant space means lower taxes because of their low assessment.
Together this leaves very little pressure for owners of office and retail space to lower rents to the benefit of small businesses or fill vacant space to the benefit of the county’s tax revenue.
Other jurisdictions such as Washington, D.C. and San Francisco have developed a version of their own vacancy taxes. The intention of each is different, for example, San Francisco’s vacancy tax is only on storefront retail to maintain street-level vibrancy, and Washington D.C.’s vacancy tax is on office, retail, and residential, but based on the class of real estate to prevent general blight. Our real estate vacancy problems are unique to us and should be considered by our own stakeholders to frame a solution that prevents unintended consequences.
There has been some debate on whether Arlington has the authority to levy this type of tax. I would argue that there is precedent based on the tax exemption programs that we currently provide. If this is still deemed an unavailable tool in our toolbox based on state law, it might be worth restructuring the incentive in the form of a fine that we do have authority to enforce or for our government affairs team to push for this authority in the next General Assembly session.
Having the Commissioner of Revenue begin assessing taxes would likely save homeowners and commercial building owners in taxes, but would likely decrease overall county revenues. Levying a vacancy tax would benefit small businesses looking for office space, create a better restaurant and retail vibrancy, and increase county revenues, but would likely adversely impact commercial property owners. My hope is that further dialogue on these topics will benefit homeowners, small businesses, and on balance, our entire community.
Nicole Merlene is an Arlington native and former candidate for Virginia State Senate. She has served as a leader in the community on the boards of the Arlington County Civic Federation and North Rosslyn Civic Association, as an Arlington Economic Development commissioner, in neighborhood transportation planning groups, and as a civic liaison to the Rosslyn Business Improvement District.
Coronavirus Case in Falls Church — “On Mar. 9, a U.S. Navy civilian employee at the US Navy Bureau of Medicine and Surgery (BUMED) in Falls Church, Virginia, tested ‘presumptive positive’ for the coronavirus (COVID-19)… The individual is currently at a hospital in Northern Virginia.” [U.S. Navy]
Northam Signs Arlington Tourism Tax Bill — “The governor’s signature on March 2 made it official – Arlington will now be able to impose a surtax on hotel stays, with the proceeds going to tourism promotion, in perpetuity. Gov. Northam signed legislation patroned by state Sen. Janet Howell (D-Fairfax-Arlington) removing the ‘sunset clause’ from existing legislation allowing Arlington to tack on an additional 0.25 percent to the 5-percent transient-occupancy tax imposed by the county government on those staying in hotels and motels.” [InsideNova]
Lawmakers Support Long Bridge Project — Virginia’s delegation to Congress “sent a letter to Secretary Chao in support of the Virginia Department of Rail and Public Transportation’s (DRPT) application for an Infrastructure for Rebuilding America (INFRA) grant for the Long Bridge Project.” [Press Release]
No Arlington Rep on Metro Board — “For the first time in recent memory, Arlington will have no representation on the board of directors of the Washington Metropolitan Area Transit Authority (WMATA), which operates the Metro system… The shifts came about due to the resignation from the WMATA board of Arlington County Board member Christian Dorsey, due to issues over reporting of campaign contributions during his 2019 re-election bid.” [InsideNova]
Beyer Gains a GOP Challenger — “On Friday, Mark Ellmore officially filed to seek the Republican nomination for Congress from Virginia’s Eighth District in 2020…. It is currently represented in Congress by Democratic Rep. Don Beyer.” [Falls Church News-Press]
Biden Wins Virginia — “Virginia voters have overwhelmingly given former Vice President Joe Biden a sizable win over Vermont Sen. Bernie Sanders in Tuesday’s primary election. According to unofficial state election returns, Biden has been called the winner of the state with 53.3 percent of what was a record primary turnout, and will capture the largest share of its 99 delegates.” [Patch, Washington Post]
Bernie Underperforms 2016 — In the two-way race between Hillary Clinton and Bernie Sanders in 2016, Sanders captured 33% of the vote in Arlington. Yesterday, he received 19% of the vote, a close third to Elizabeth Warren at 20%.
FAA Taking Comments on DCA Noise — “After changing the routes for planes taking off from Reagan National Airport, in Arlington, Virginia, the Federal Aviation Administration is holding a public comment period. The comment period closes March 30. In an email, Libby Garvey, chair of the Arlington County Board, said that even if people in the community submitted earlier complaints, the FAA will not be officially considering them.” [WTOP]
Tafti Defends Changes at Prosecutor’s Office — “There’s this false critique that these reforms are making our communities less safe. We’ve been fed a story for decades that we have to incarcerate and have zero tolerance in order to be safe. More and more we are finding that harm reduction — for drug use, mental illness treatment, restorative justice — is more effective.” [Arlington Magazine]
Police: Two Arrested in Stolen Vehicle — “At approximately 2:40 p.m. on March 1, officers [in Pentagon City] were alerted to a license plate reader hit on a vehicle previously reported stolen out of Washington D.C. Officers observed two subjects walking away from the parked vehicle and conducted surveillance in the area. The subjects were taken into custody without incident as they returned to the vehicle… A search of the vehicle located suspected narcotics.” [Arlington County]
Chamber Cheers Tourism Tax Bill — “The Arlington Chamber of Commerce celebrates the General Assembly’s establishment of permanent funding for tourism promotion in Arlington. This 0.25 percent Transient Occupancy Tax surcharge on hotel rooms is used exclusively by Arlington Convention and Visitors Service… to grow travel and tourism in Arlington. Previously, the tax surcharge was enacted with a July 1, 2021 sunset” provision. [Arlington Chamber of Commerce]
Bill Could Boost N. Va. Metro Funding — “Northern Virginia localities could soon have the ability to spend more money on Metro service increases after state lawmakers approved a bill that tinkers with the dedicated funding agreement for the transit agency… Virginia’s total financial contribution to Metro can’t increase by more than 3% each year, a condition designed to impose fiscal discipline on the agency. The bill from Del. Vivian Watts, D-Annandale would exempt any costs associated with service increases from that cap.” [Washington Business Journal]
With rising property assessments, the Arlington County Board sees no need to raise taxes this year.
The Board on Tuesday advertised a maximum property tax rate unchanged at $1.013 per $100. The question is: should the rate be lowered?
On one hand, the rate was raised by two cents last year, and 4.3% higher residential assessments this year amid already-high property values mean the average homeowner will pay an extra $376 this year even if the rate doesn’t change. That’s higher than the expected tax burden rise in Fairfax County, even with a three cent rise in its rate. Those yearly increases in the tax burden add up. Additionally, there seems to be some wiggle room in the proposed budget.
On the other hand, the current rate is not particularly high — it’s the lowest among other major Northern Virginia jurisdictions — and those who own homes in an affluent area like Arlington are generally able to afford the extra taxes. Plus, there’s no need to adopt an austerity budget during good economic times and a development boom in a county with a growing population, ever-rising school enrollment, and Amazon in the process of moving in.
What do you think?
The Arlington County Board voted yesterday to advertise a maximum tax rate that will, at most, keep the current rate steady.
Arlington’s rosier financial picture, with the ongoing arrival of Amazon’s HQ2, was enough to have Schwartz smiling during a recent budget presentation, touting “a good budget year.” And it might be enough to even support a tax cut.
Arlington County Board Chair Libby Garvey pointedly floated the idea of bringing down the current $1.013 per $100 rate in her remarks yesterday.
“This year’s higher assessments mean that even without an increase in the tax rate, most homeowners still would see the biggest jump in their real estate taxes since 2016,” said Garvey, who’s facing a primary challenge this year. “Facing that reality, we will certainly be looking for ways to adopt a lower rate than what we have advertised today when we finalize the budget in April.”
The rise in assessments — 4.3% for residential properties and 4.9% for commercial properties — means more tax revenue, but also a higher tax burden on property owners.
“With no increase in the property tax rate, the County expects $51.1 million in additional ongoing revenue,” a county press release noted. “Should the Board adopt the current tax rate and other proposed fee increases, the average Arlington homeowner would see their fees and taxes increase by $376 from what they paid in FY 2020, based on a home value of $686,300.”
Last year, amid budget pressures, the County Board voted for a 2 cent tax rate increase.
Among neighboring jurisdictions in Northern Virginia, Alexandria and Prince William have both proposed 2 cent property tax rate increases this year, Loudoun has proposed a 1 cent reduction, and Fairfax County just proposed a 3 cent hike. Arlington’s rate is currently the lowest of the group.
Despite Fairfax’s proposed 3 cent hike, the increase in taxes on the average homeowner would actually be lower than that in Arlington with no tax rate change here — $376 vs. $346. Residential property assessments in Fairfax rose an average of 2.65% this year.
(1/5) Proposed budget highlights:
3-cent real estate tax increase to $1.18 per $100 of assessed value; average increase of $346/year.
— Fairfax County Government (@fairfaxcounty) February 25, 2020
As part of the annual budget process, the Arlington County Board will now hold a series of work sessions and public hearings, before a final vote on the FY 2021 budget on Saturday, April 18.
More on the Board’s tax rate advertisement vote, via the county press release, below after the jump.
(Updated at 5:15 p.m.) Amazon is moving in at a quickening clip and Arlington County’s budget-makers are breathing a sigh of relief.
After a few years of tight budgets, involving tax rate hikes and a handful of county staff layoffs, “this is a good budget year,” County Manager Mark Schwartz said today, ahead of presenting his proposed Fiscal Year 2021 budget to the Arlington County Board.
That means a lack of hard choices: under the proposal, the $1.013 per $100 property tax rate remains steady, county staff — particularly public safety personnel — are getting raises, and library fines are being eliminated.
“We’ve gone through some lean years where we’ve been challenged on the revenue side,” Schwartz told reporters. “This is a good news budget, based on the fact that… we have a revenue infusion that has allowed us to do some things we just weren’t able to do before.”
In all, the $1.4 billion budget increases spending by 2.9% and anticipates a 4.6% increase in tax revenue, thanks in part to rising property assessments and a boost in business taxes paid to the county.
The average homeowner can expect to pay an extra $376 in property taxes, even with the rate holding steady. Arlington’s tax rate is lower than that of Alexandria ($1.130), Fairfax ($1.150) and Loudoun ($1.045).
After years of budget pressures caused by increases in health costs and Metro funding, among other rising expenses amid slowly-growing revenue, Schwartz struck a decidedly upbeat tone this year. He predicted future revenue growth as Amazon continues to grow its presence and other businesses flock to the county.
“The past few years we have seen the effects of a record-high commercial vacancy rate,” Schwartz said in a statement. “Now we are beginning to see the results of our commitment to economic development and spending realignments. This budget represents an investment in the cornerstones of County government with an eye toward an innovative future in Arlington.”
“We’re coming out of the trough,” Schwartz added.
Perhaps the biggest source of budget friction this year will be with Arlington Public Schools.
Schwartz is taking pains in his presentation to emphasize that Arlington County has been increasing the percentage of tax revenue it sends to the school system, a separate governmental entity. This year, under Schwartz’s budget, APS is slated to receive $550 million, up from $500 million two years ago.
Schwartz says he expects APS, with its ever-rising student enrollment, to ask for more. But the extra $17.7 million the schools are receiving this year should be more than adequate to account for the increase in students, he said.
The budget presentation notes that APS spends $19,921 per student, according to the Washington Area Board of Education formula — the highest per-pupil cost in the region.
Other highlights from the budget include:
- An additional $9.1 million for affordable housing, including more for housing grants, rent assistance and affordable housing development.
- A 3.25-3.5% increase in pay for general county employees and an approximately 6.5% increase in pay for public safety employees (to help, in part, with police and fire department recruitment.)
- $49.3 million for Metro, a 4 percent increase from last year.
- Creating a new “traffic enforcement and control” position inside the police department, with six new full-time staffers charged with enforcing things like scooters on sidewalks and cars parked in bike lanes.
- Nine new positions in the fire department and funding for a second recruit class.
- Eliminating library fines, as part of the county’s new focus on equity. The fines disproportionally are imposed on people of color who live on the western end of Columbia Pike, Schwartz said.
- “Funding to phase in [County] Board member salary increases over a three-year period.”
- Additional funding for sidewalk, street, and streetlight maintenance.
The budget focuses “on foundational area of County government” and “shores up investments in County infrastructure and core services,” Schwartz says in his presentation.
Pentagon City Redevelopment on Pause — “Brookfield Properties has suspended plans to launch a major redevelopment of the Transportation Security Administration’s headquarters in Pentagon City once the federal agency moves to its new home in Springfield in mid- to late 2020… it’s a reflection of the new reality that Amazon’s HQ2 has created in the neighborhood.” [Washington Business Journal]
Vote on Add’l Speeding Fine This Weekend — “Currently, a ticket for going 10 mph over the speed limit in a residential zone is about $80. The additional fine would bring that ticket to $280. ‘People drive like maniacs around here. It’s about time they got some punishment,’ Arlington resident Jack Feegel said.” [NBC 4]
Arlington Resident Helps Return Lost Dog — “A lost dog was reunited with its owner thanks to a passing motorist, who noticed something unusual on their way to work, and a fellow driver farther along the road. Dashcam footage shows the unnamed motorist, from Arlington, Virginia, driving to their workplace in Silver Spring, Maryland, on January 13.” [Daily Mail]
ACFD Responds to Calls in Maryland — It’s rare for the Arlington County Fire Department to respond as mutual aid to an incident in Maryland, but it happened Wednesday morning, with several units dispatched to Prince George’s County. [Twitter, Twitter]
Arlington Tourism Tax May Be Made Permanent — “The Arlington County government looks ready to get a major present from the new Democratic majority in the General Assembly. The state Senate has passed and sent to the House of Delegates a measure that removes the sunset provision on Arlington’s authority to impose a 0.25-percent surcharge on hotel taxes to support tourism promotion.” [InsideNova]
Nearby: No Streetcar in Georgetown — “Plans to extend the DC Streetcar to Georgetown have been effectively scrapped. The District Department of Transportation is halting all work on the project ‘for the foreseeable future,’ according to documents submitted to the D.C. Council.” [WTOP]
Flickr pool photo by Rex Block
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.
(Updated at 4:15 p.m.) Arlington County Board Chair Christian Dorsey says he should have, upon reflection, informed the community about his personal bankruptcy filing before November’s election.
The Post reported in November that Dorsey, 48, “filed for bankruptcy last month after falling behind on his mortgage and accruing tens of thousands of dollars in credit card debt.” The paper noted that the bankruptcy filing came as Dorsey’s South Arlington home was facing possible foreclosure and as his wife dealt with health problems.
Questions have arose in the wake of the bankruptcy revelation. For one, given that the filing was made on Oct. 16, should voters have been informed prior to the Nov. 5 election?
Dorsey tells ARLnow that he now regrets not letting people know despite how personal the issue is for him and his family.
“In retrospect, I should have had a conversation with the community, no matter how difficult, when I filed for bankruptcy in mid-October,” Dorsey said via email Thursday evening. “I do believe, however, that I will demonstrate over the next four years that those who voted for me did not make a mistake.”
Dorsey was also asked about an assertion made by the bankruptcy trustee that he had not submitted his previous year’s state income tax return. Dorsey contended that he did, in fact, file his state taxes.
“I filed, yet I discovered at my bankruptcy hearing that the Commonwealth has no record,” he said. “I have resubmitted my 2017 filing.”
(By law, Virginia’s state tax office is prohibited “from providing information or commenting on specific taxpayer situations,” a spokeswoman said.)
Court documents show that Dorsey expects $5,000/mo in “other income” besides his annual County Board salary of just over $60,000. The bankruptcy trustee objected to that, writing that the $5,000/mo figure “has not been documented or verified.” Dorsey says that income comes from consulting work.
“I do policy and communications consulting,” he said. “I am not comfortable talking about my clients within the context of your article, but attest that they are exclusively 501(c)3 non-profits, political non-profits, philanthropic foundations and universities.”
“None are foreign entities,” Dorsey added. “None do business with Arlington County. None have given to my political campaigns.”
Dorsey’s most recent conflict of interest form filed with the Clerk of the County Board discloses outside work with a pair of firms that paid him more than $5,000 annually: KNP Communications and Upswing Strategies, both in D.C.
Though serving on the Arlington County Board is ostensibly a part-time job, Dorsey’s work for Arlington extends beyond the County Board dais to representation on a number of regional bodies. Dorsey serves on the Washington Metropolitan Area Transit Authority (WMATA) Board, is a commissioner on the Northern Virginia Transportation Commission (NVTC) and represents Arlington on the Board of Directors of the Metropolitan Washington Council of Governments (COG).