Arlington, VA

(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.

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Morning Notes

Amazon Tweaking HQ2 Heating Plan — “Amazon.com Inc. confirmed it will tweak some elements of its HQ2 plan in Arlington County to eliminate a carbon dioxide-emitting system. The news comes a little more than a week after CEO Jeff Bezos announced in D.C. plans to end the company’s reliance on fossil fuels in a decade.” [Washington Business Journal]

County Tax Deadline Coming Up — “Taxes are due soon! If you have moved or sold your car, you may still owe taxes for the months when your car was in Arlington. If you are waiting for account adjustments, still pay your bill in full by Oct. 5. Overpayments will be refunded.” [Twitter]

Video: Ovi at ATS — Arlington Public Schools has released a video from Caps star Alexander Ovechkin’s recent visit to Arlington Traditional School. “Hi kids, I think it’s breakfast time for you, no?” Ovechkin asked as he pushed a grocery cart full of Ovi O’s cereal into a classroom. [Vimeo]

Dorsey to Talk Racial Equity at Church — “Christian Dorsey, Chair of the Arlington County Board, will be speaking about racial equity at Rock Spring Congregational United Church of Christ, 5010 Little Falls Road, at 7:00 p.m. Monday, October 7.” [Press Release]

New Daycare Center Near Fairlington — “As Alexandria struggles with affordable daycare, a new facility is in the works near the Fairlington neighborhood. A special use permit has been filed for Our First Step Daycare Center, a new daycare center planned for 2500 N. Van Dorn Street.” [ALXnow]

Ever Have a Dream Like This?Updated at 8:35 a.m. — “Scanner: Police responding to S. Four Mile Run Drive for a report of a naked woman who walked on to an ART bus then walked right back off.” [Twitter]

Flickr pool photo by John Sonderman

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Local bookstore One More Page (2200 N. Westmoreland Street) will be able to pay the bills after all, thanks to its auction last month.

“We received donations of wine, window washing service, and many other items,” said owner Eileen McGervey, of the items the store auctioned off. “It was really quite overwhelming.”

In total, the online auction raised $20,374.32, passing its goal of $20,000.

The highest bid item was an original cartoon by the late Richard Thompson, which was donated by his wife Amy Thompson — it sold for $1,111.50. The item the fetched the second highest bit was naming rights to a character in the the Wine Country mystery series by Ellen Crosby, which sold for $725.

McGervey described the auction as a “wonderful success” to ARLnow and said the money raised was enough to cover the vendors she wasn’t able to pay after the building owner raised her rent by 30 percent in July. The spike in rent was caused largely by changes to the county’s real estate valuation method for the type of condominium building that houses One More Page.

The building’s property tax liability more than doubled this year, even after an appeal that knocked $700,000 off the valuation.

Arlington County Board Chair Christian Dorsey tells ARLnow he has been working with the parties involved to try to make sure One More Page could meet its obligations and stay in business.

“Shortly after this issue raised itself in the public eye, I spoke with the owner and we tried to see what we could do and what would be available,” Dorsey said.

Dorsey encouraged any small businesses affected by the real estate valuation change to contact Arlington Economic Development’s BizLaunch division.

Dorsey said he was “deeply sympathetic” to the bookstore’s plight, noting that the establishment is one of his family’s favorites. But he added that the valuation changes was necessary because “for years we were not taxing at the appropriate levels, which create larger issues of equity.”

In the meantime, McGervey said that the bookstore is looking into holding more events to help it stay afloat. She’s also started a Patreon membership program after would-be auction buyers said they were interested in supporting the bookstore that way.

“The whole experience has invigorated us and our customers to make sure we stay here,” McGervey said.

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Morning Notes

Arlington: Most Competitive Housing Market in U.S. — “The most competitive U.S. housing markets are the two that are closest to Crystal City, home of Amazon’s upcoming second headquarters (HQ2) in Virginia: Alexandria and Arlington. This is according to the latest ranking of cities by Redfin Compete Score.” [Redfin]

County Hits Record Low Tax Delinquency — “Treasurer Carla de la Pava announced that the delinquency rate for real estate and personal property had fallen to 0.177 percent, down from 0.21 percent a year before and the lowest not just in county history, but perhaps the lowest ever among any jurisdiction in Virginia history.” [InsideNova]

AWLA Hosts Successful Adoption Event — “40 cats and 14 dogs found their forever homes at [Saturday’s] Clear The Shelters event! Thank you to everyone who found space in their hearts and homes for our animals today.” [Facebook]

Flickr pool photo by Erinn Shirley

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A local bookstore is holding an auction to raise money after the owner says rent increased by 30 percent this year due to property tax changes.

One More Page Books, located in the East Falls Church neighborhood at 2200 N. Westmoreland Street, is hosting a silent auction fundraiser from Friday, August 2 at 6:30 p.m. until Sunday, August 18 at 5 p.m. The bookstore is currently finalizing the item list, which currently ranges from artwork and chocolates, to bike tours and book manuscript consults.

Owner Eileen McGervey said she was excited for the auction, which kicks off with the store’s regularly-scheduled wine and cheese party Friday night. She told ARLnow that customers came up with the idea of the auction, which has since gathered items like handmade shawls and a dinner with media members who cover the Capitals.

The auction was arranged after McGervey said the landlord informed her last month that the real estate taxes for the building went up significantly. The end result? A 30 percent rent increase, applicable to the current year.

McGervey said that’s a challenge for the independent bookstore not only because it operates on small profit margins, but also, “unlike other businesses we don’t have the option of raising the prices because books come with prices on them.”

The tax hike was the result of the county changing the way it calculates the value of some commercial buildings, like the mixed-use commercial condo building One More Page inhabits. The change more than doubled the assessed value of One More Page’s space — and thus also its assessed taxes — even after it was lowered on appeal.

(That’s on top of the County Board approving a real estate tax hike which increased the amount owners pay by two cents for every $100 in assessed property.)

“Unfortunately, in the case of the condominium that houses One More Page, this meant an increase in the assessed value of the property from CY 2018 of $2,351,100.00 to a CY 2019 valuation of $5,591,100.00,” Board Chair Christian Dorsey wrote in a letter to McGervey, who had asked if the Board could offer any assistance to the bookstore.

Dorsey continued:

This is indeed a large jump in the assessed value of the building. The County is bound by the Constitution of Virginia and State Code to assess all real estate at fair market value, and this methodology provides a more accurate assessment of commercial condominium values than did the previous. This methodology took into consideration the actual income and expense data submitted by the owner of the property along with similar condominiums in Arlington.

While the owner chose not to appeal the assessment with the County’s Board of Equalization this year, the owner did file an administrative appeal, resulting in a $700,000 reduction in the CY 2019 assessment, to $4,907,500. With the assessment reduction, the total tax bill for the building in Calendar Year 2019 is $56,485.00, up from $26,228.67 in CY 2018.

One More Page has been able to cover the rent raise in the past month, but at the expense of paying some of its vendors. Asking for help covering these bills is awkward, McGervey said, but better than the alternative.

“You don’t want to just be gone one day and have people not know that you could have been there,” McGervey said.

She noted that she’s now exploring the idea of a membership program to cover future rent needs.

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Virginia’s annual sales tax holiday is set for this coming weekend.

Gov. Ralph Northam (D) announced this week that the tax-free weekend will last from this Friday, August 2 through Sunday, August 4. Shoppers can take advantage of it by purchasing items like school supplies and back-to-school clothes, as well as emergency equipment to prepare for hurricane season and energy-efficient home appliances, without the added expense of a sales tax.

“The annual sales tax holiday makes many important items more affordable for Virginians as they get ready for the new school year or stock up on basic supplies,” said the governor in a statement.

Per the governor’s statement the following items will be sold sans tax:

  • School supplies, clothing, and footwear:
    • Qualified school supplies – $20 or less per item; and
    • Qualified clothing and footwear – $100 or less per item.
  • Hurricane and emergency preparedness products:
    • Portable generators – $1,000 or less per item;
    • Gas-powered chainsaws – $350 or less per item;
    • Chainsaw accessories – $60 or less per item; and
    • Other specified hurricane preparedness products – $60 or less per item.
  • Energy Star™ and WaterSense™ products:
    • Qualifying Energy Star™ or WaterSense™ products purchased for non-commercial home or personal use – $2,500 or less per item.

In 2015, Virginia General Assembly combined three different sales tax holidays into one, long weekend event.

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A pair of commercial property tax hikes in D.C. may drive additional economic activity in Arlington, according to a new report.

Commercial real estate services firm JLL says higher commercial property taxes in the District — a 2.2% hike from $1.85 to $1.89 per $100 of assessed value — “will cause rent paid by office tenants to jump further, at a time when the market’s supply-demand paradigm strongly favors tenants.”

The report also says an approved 72% increase in the District’s deed transfer and recordation tax will cause commercial property sales activity to “grind to a halt in the mid- to long-term.”

The new taxes will take effect Oct. 1, at the beginning of D.C.’s new fiscal year, as part of a $15.5 billion budget that includes new investments in affordable housing.

Between D.C. making itself more expensive for commercial property owners and lessees, and the arrival of Amazon’s HQ2, JLL says conditions are ripe for increased economic activity in Northern Virginia and Arlington, in particular.

DC’s losses will be Northern Virginia’s gains. These tax hikes come at a time when Northern Virginia is heating up as an investment alternative to DC. Transaction costs were already substantially lower in Arlington County than in Washington, and now will be even more so. It is no stretch to say that this will attract capital away from DC and toward Arlington’s top-tier offerings, of which there will be many when HQ2-related demand spurs the development of new buildings and the lease-up of old ones.

Bisnow, which first reported on the study, quoted JLL Managing Director of Research John Sikaitis as saying the new dynamic could drive increased investment interest and office leasing in Arlington.

With the increased taxes on commercial property sales making deals harder to pencil in D.C., the JLL researchers expect investors will begin to look across the river. Northern Virginia has traditionally not been viewed as the same type of core market as D.C. in the eyes of outside investors, but an improving office market and expected growth from Amazon HQ2 has them taking a closer look.

“No one denies now that Arlington is a core market with a significant amount of future urban demand,” Sikaitis said. “You’re now seeing institutional investors start to look at Arlington from an investment perspective, which didn’t happen 12 or 24 months ago. Their allocation to D.C. could be allocated to Arlington.”

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Morning Notes

Another Water Main Break in Courthouse — “Emergency Water Main Repairs: Crews working on a 6-inch valve leak at 1315 N Barton St. Traffic is detoured around the work site. At least one high-rise building is affected.” [Twitter]

Business Owners Planning for HQ2 — “Dawson and Bayne said Highline is ‘a happy-hour machine’ during the week, thanks to the office buildings that surround it. But business late at night and on weekends isn’t as steady. The impending arrival of Amazon, however, is causing the business partners to rethink Highline’s concept.” [WTOP]

Break-in at Overlee Pool — “At least seven community pools were the targets of theft or vandalism late Sunday into Monday, according to police and pool managers. The crime spree spanned Fairfax and Arlington counties, yet police have not been able to connect all seven cases to the same set of suspects.” [Fox 5]

Workers Striking at DCAUpdated at 9:25 a.m. — “Several union workers for two major airlines are on strike outside of Reagan National Airport on Thursday. The workers are employed by the Delta contractor Eulen Airport. Roughly six employees protesting tell ABC7 they are not being treated fairly by their contractors and are calling for better working conditions with some claiming they don’t receive lunch breaks.” [WJLA]

Levine Challenger Fails to Qualify for Ballot — “He had an opponent, then he didn’t. And as a result, Del. Mark Levine (D-45th) is home free in the Nov. 5 general election.” [InsideNova]

Nearby: Falls Church Mayor on Tax Deduction Changes — “Mayor P. David Tarter testified yesterday before the House Ways and Means Subcommittee on Select Revenue Measures about the impact of the cap on the deductibility of state and local tax (SALT) on federal returns… ‘[The SALT deduction cap] means that tax dollars that could have gone to the city are now going to the federal government, and there is less money available for essential local services like schools, police, and fire protection.'” [City of Falls Church]

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Morning Notes

Dense Fog Advisory This Morning — “A Dense Fog Advisory has been issued for the DC/Baltimore metro areas, including portions of western MD & eastern WV. Use caution driving early this morning, and allow extra time to reach your destination. The fog should dissipate by around 9am.” [Twitter]

HQ2 May Look Like HQ1 — “Amazon.com Inc. has enlisted a trio of firms deeply involved with the development of its Seattle campus to help shape the plans for its second headquarters, an early indication the two campuses could share some common design elements.” [Washington Business Journal]

Arlington Marks Older Americans Month — “As we enter the month of May, Arlington is joining the nationwide observance of Older Americans Month. We’ll be recognizing the positive impact older adults have in and around our community and highlighting the many programs and services we offer them.” [Arlington County]

Write-Up for Hot Lolas in Ballston Quarter — “Two new shops experiment with heat levels and global inspiration for new wave fried chicken sandwiches.” [Northern Virginia Magazine]

Beyer in the News — “Rep. Don Beyer was South Bend Mayor Pete Buttigieg’s first Congressional endorsement, and he said Wednesday that he ‘deeply’ believes there needs to be a woman on the Democratic ticket ‘either as president or vice president.'” Also, Beyer is calling for the resignation of Attorney General William Barr. [CBS News, Twitter]

Nearby: No Tax Rate Hike for Alexandria — “The Alexandria City Council unanimously adopted a $761.5 million budget Wednesday without raising taxes or cutting services, adding more money for schools, early childhood education, additional firefighters and a new $100,000 fund to provide lawyers for residents facing deportation. The property tax rate, for the second year in a row, will stay at $1.13 per $100 of assessed value.” [Washington Post]

Flickr pool photo by Eric

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Morning Notes

Fatal Crash Along I-395Updated at 10:05 a.m. — Virginia State Police are investigating a fatal motorcycle crash that happened on the ramp from northbound I-395 to Washington Blvd. [ARLnowWTOP]

County Board Planning Tax Rate Hike — “Owners of a typical Arlington single-family home will see this year’s real-estate tax bill rise 4.95 percent to more than $8,400 under the county government’s fiscal 2020 budget slated for approval this week. County Board members on April 18 tentatively opted for a 2-cent increase in the real estate tax rate, bringing it to $1.026 per $100 assessed value and making Arlington the only jurisdiction in Northern Virginia’s inner suburbs to impose a tax-rate increase on homeowners this year.” [InsideNova]

UNTUCKit Coming to Pentagon City Mall — Internet-born clothing brand UNTUCKit, which specializes in button-down shirts intended to be worn untucked, is planning to open on the second level of the Fashion Centre at Pentagon City mall, next to Nordstrom. [Twitter]

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(Updated at 10:45 p.m.) About a year ago at this time, Arlington looked to be in serious trouble down in Richmond.

In mid-March 2018, county officials faced the decidedly unpleasant prospect that they’d come out on the losing end of a bruising legislative battle with two local golf and country clubs.

One of the county’s foremost foes in the General Assembly had engineered the passage of legislation to slash the clubs’ tax bills, potentially pulling more than a million dollars in annual tax revenue out of the county’s coffers.

Arlington had spent years tangling with the clubs, which count among their members local luminaries ranging from retired generals to former presidents, arguing over how to tax those properties. Yet the legislation from Del. Tim Hugo (R-40th District) would’ve bypassed the local dispute entirely, and it was headed to Gov. Ralph Northam’s desk.

That meant that Arlington’s only hope of stopping the bill was convincing the governor to strike it down with his veto pen.

In those days, long before evidence of Northam’s racist medical school yearbook photos had surfaced, the Democrat was well-liked in the county. He’d raised plenty of cash from Arlingtonians in his successful campaign just a year before, and had won endorsements in his primary contest from many of the county’s elected officials.

Yet the situation still looked dire enough that the County Board felt compelled to take more drastic steps to win Northam to their side. The county shelled out $22,500 to hire a well-connected lobbying firm for just a few weeks, embarking on a frenetic campaign to pressure the governor and state lawmakers and launch a media blitz to broadcast the county’s position in both local and national outlets.

“It became apparent to all of us that every Arlingtonian had something at stake here,” then-County Board Chair Katie Cristol told ARLnow. “At a time when we were making excruciating decisions about our own budget, the idea that you would take more than million dollars and put it toward something that wasn’t a priority for anyone here was so frustrating.”

That push was ultimately successful — Northam vetoed the bill last April, and the county struck a deal with the clubs to end this fight a few weeks later.

An ARLnow investigation of the events of those crucial weeks in spring 2018 sheds a bit more light on how the county won that veto, and how business is conducted down in the state capitol. This account is based both on interviews with many people close to the debate and a trove of emails and documents released via a public records request (and published now in the spirit of “National Sunshine Week,” a nationwide initiative designed to highlight the value of freedom of information laws).

Crucially, ARLnow’s research shows that the process was anything but smooth sailing for the county, as it pit Arlington directly against the club’s members. Many of them exercise plenty of political influence across the region and the state, and documents show they were able to lean heavily on Northam himself.

“One would expect a Democratic governor to be highly responsive to one of most Democratic jurisdictions in the state,” said Stephen Farnsworth, a professor of political science at the University of Mary Washington in Fredericksburg. “But this was a matter of great concern to a bunch of very important people in Virginia, and that may well be the reason why additional efforts were necessary.”

And, looking forward, the bitter fight over the issue could well have big implications should similar legislation ever resurface in Richmond.

“Structurally, this bill could absolutely come back someday,” Cristol said. “And the idea that a bill that has such deleterious consequences for land use and taxation in jurisdictions across Virginia could come back and garner support because of an effective lobbying interest is very much a real threat.”

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