R&E Report on Resolution Introduced by Tim Wise, Arlington County Taxpayers
Association (ACTA)
The R&E Committee has reviewed the resolution, offered several changes to clarify it,
and supports the recommendation that the County cut the tax rate by $0.03, basically
returning to the 2012 tax rate of $0.97. Even with the suggested reduction, proposed tax
and fee revenues would increase by at least $24 million, and likely more. State and
Federal contributions are projected to increase by 6.5% and 4.8% respectively for FY
2015.
In the first six months of FY 2014 the County generated a surplus of $27.6 million,
which alone would more than cover the recommend tax rate reduction of approximately
$20 million. This surplus will likely increase by the end of the current fiscal year.
The County consistently underestimates revenues, resulting in a significant amount of
end-of-year surplus available for spending on lower-priority items not included in the
proposed regular budget.
R&E believes the rate reduction can be accommodated within present and anticipated
revenues without any significant disruption to operations or level of support for core
functions. Some discretionary and/or non-core expenses could be reduced or deferred,
depending on decisions of the County Board and County Manager.
1) Washington Post Graphic “Tax bills climb with home values”
(See Attachment #1)
Comment: Increases in Arlington property assessments result in highest regional
property tax bills, even as tax rate remains the same.
2) Real Estate Tax Payment (Average Single Family Home)
(See Attachment #2)
Comment: In past years as property assessments increased, the County reduced
the tax rate. For example, the County reduced the tax rate by 6 cents in 2006.
Since then, the tax rate has increased from $0.818 to $1.006, an increase of 23%.
Even if the tax rate is reduced by 3 cents in CY 2014, real estate taxes would still
increase by $88 per household.
Source: County Manager’s Fiscal Year 2015 Proposed Budget, p. 105
3) Arlington County Fiscal Year Closeouts, FY 2009 – FY 2014 (mid-year)
Fiscal Year
2009
2010
2011
2012
2013
2014
Surplus/(Deficit)
$27.8 million
($1.4 million)
$16 million
$15 million
$25.6 million
$27.6 million (mid-year)
Comment: The County has generated a surplus in each year since FY 2009 with the
exception of a small deficit in FY 2010. These surpluses would have allowed tax rate
reductions in each surplus year ranging from 2.4 to 4.5 cents. Note that in virtually
every year, the County’s ‘adopted’ and actual budgets are higher than the Manager’s
‘proposed’ budget, often substantially higher.
Source: DMF reports on previous fiscal year closeouts
4) Tax & Fee Increases – FY 2015 Proposed Budget
Tax/Fee
Total Amount
ph/per year*
% Increase
Pers Property
$108.6 MM
Varies
+2%
Meals
$36.8 MM
Varies
+6%
Res. Utility
$1.7 MM
$36
+7%
ART
$4.8 MM
Varies
+15%
Recreation
$9.99 MM
Varies
+9%
Refuse/Recycling
$9.95MM
$300.72
+ 4%
Water/Sewer
$92.6 MM
$912.80
+3%
*(per household/per year)
Comment: The County projects that the above non-real estate taxes and fees will
increase in FY 2015.
Source: Manager’s Proposed FY 2015 budget, pages 65-107
This report and recommendation was approved by a committee vote of 6-1. One member
of the R&E Committee believed the recommended residential tax rate cut should be 1
cent, with an additional cut to the commercial tax rate surcharge of 12.5 cents.
Burt Bostwick
Acting Chair, Revenues & Expenditures Committee