taxes

Morning Notes

By ARLnow.com
Kayakers on the Potomac near Key Bridge (staff photo by Jay Westcott)

Driver Crashes into Trooper’s Cruiser — A Virginia State Police trooper was radioing in a license plate during a traffic stop on I-395 near Shirlington when his cruiser was rear-ended. The trooper finished giving the tag number before telling the dispatcher about the crash. [Twitter]

Circulator Strike Continues — “The first day’s negotiations between a bus drivers union and the operator of D.C. Circulator since workers began striking were unsuccessful through Wednesday evening, increasing the prospects of a potentially lengthy outage of the city’s only public bus service.” [Washington Post]

Marymount Planning Child Care Center — “Marymount University is setting up a new child care center on campus in a renovation project that it said is designed to fill a critical, and deepening, local workforce need as those with young children return to the office. The Marymount Early Learning Academy for children aged 3 to 5 will open in the summer or fall of 2023, reviving the idea of an on-campus preschool that the university used to run in the 1990s before it closed down.” [Washington Business Journal]

Sexual Battery Incident in Pentagon City — “500 block of 12th Road S…. at approximately 11:40 p.m. on April 29th the male victim had entered into the elevator of a secure residential building when the unknown suspect followed behind him. The victim exited the elevator and walked down the hallway, during which the suspect grabbed his buttocks. The suspect then fled the scene.” [ACPD]

Air Force Colonel on Trial — “An official with the California National Guard charged with indecent exposure in Arlington in March is scheduled to go to trial in Arlington on July 18… the suspect entered the business and exposed himself to female victims, according to the ACPD.” [Patch]

Falls Church Lowers Property Tax Rate — “On Monday night, the Falls Church City Council approved a $112.8 million Fiscal Year 2023 (FY23) that invests in public schools, core government services, walkability and traffic calming, environmental sustainability, and more, all while reducing the real estate tax rate by 9 cents… To mitigate the 11 percent overall increase in real estate assessments, the adopted budget includes a decrease in the real estate tax to $1.23 per $100 of assessed value.” [City of Falls Church]

It’s Cinco de Mayo — Mostly cloudy, with a high of 67 and low of 56. Sunrise at 6:07 am and sunset at 8:06 pm. [Weather.gov]

Morning Notes

By ARLnow.com
Washington Blvd and N. Nelson Street at night (Flickr pool photo by Cyrus W)

APS Looking for New Academic Officer — “The Arlington school system is on the hunt for a new academic chief, after the incumbent in the position was dispatched to serve for a second tour of duty as a middle-school principal. Bridget Loft, the current chief academic officer, on April 28 was appointed principal at Swanson Middle School, a post she held from 2011-17 before moving on to serve as principal at Yorktown High School and then hold the school system’s top academic-focused leadership post.” [Sun Gazette]

Taxes Up By a Sixth in Three Years — “Another year of no reduction in the Arlington real-estate tax rate to offset spiraling assessments means that the typical county homeowner will be paying 17 percent more in taxes to the government compared to three years ago.” [Sun Gazette]

Cristol Weights in on Possible Roe Decision — From Arlington County Board Chair Katie Cristol: “Anticipating the impending decision to fully overturn Roe vs. Wade didn’t make it any less shocking. The reality that our nation is moving backwards on the fundamental right of women to exist in a democratic society without being forced by the state to give birth is chilling.” [Twitter]

It’s Wednesday — Possible light rain in the morning and storms around midday. High of 77 and low of 60. Sunrise at 6:08 am and sunset at 8:05 pm. [Weather.gov]

Flickr pool photo by Cyrus W

Morning Notes

By ARLnow.com
Cherry blossoms in Pentagon City (staff photo by Jay Westcott)

Changes Coming to ‘Crossing Clarendon’ — “Our central greenspace, The Loop, will be expanding to offer more spaces to walk, shop, relax and explore The Crossing Clarendon. This renovation includes natural planting and landscaping, a modern play structure for the kids, upgrades to the water feature, increased pedestrian zones, and updated seating for our visitors. Construction is slated until late 2022.” [Instagram]

HQ2 Is Attracting Companies, Investors — “The National Landing area, which encompasses Crystal City, Pentagon City and part of Potomac Yard in Arlington, has an $8B development pipeline, $2.5B of which is from Amazon, National Landing BID President Tracy Sayegh Gabriel said… Neighborhood leaders, developers and brokers said that HQ2 is drawing new global investors and commercial tenants to seek opportunities in the area.” [Bisnow]

PSA: Close Your Garage Door — “2600 block of S. Joyce Street. At approximately 6:17 p.m. on March 24, police were dispatched to the late report of a breaking and entering. Upon arrival, it was determined that between approximately 10:00 a.m. and 12:00 p.m., the two unknown suspects entered into the victim’s open garage and stole numerous power tools.” [ACPD]

Expect ‘Manageable’ Local Growth — “Northern Virginia localities should expect moderate levels of jobs growth in the coming two decades, with the metropolitan area as a whole adding perhaps 880,000 new ones by 2045. ‘We are a 1-percent-a-year, on average, growing region. This is not too fast, this is not amazingly high. This is actually a very manageable pace,’ said Arlington County Board member Takis Karantonis, parsing new data at the board’s March 22 meeting.” [Sun Gazette]

‘Women of Vision’ Winners — “On Wednesday, March 30, 2022, the Arlington County Commission on the Status of Women (CSW) will honor four women for their commitment and leadership in the Arlington community with 2022 Arlington County Women of Vision awards… BUSINESS: Karen Bate and Evelyn Powers… NONPROFIT: Natalie Foote… GOVERNMENT: Tara Magee.” [Arlington County]

County Scaling Down Vax Site — “With the demand for COVID vaccines at least momentarily on the decline across Arlington, local leaders have announced plans to reopen one community center for other uses, and are working on opening up more spaces in another. County Manager Mark Schwartz on March 22 announced that, as of April 5, the Walter Reed Community Center will open for pickleball, volleyball, basketball and table games like bridge and mah jongg.” [Sun Gazette]

Governor Signs Car Tax Bill — “Governor Glenn Youngkin signed into law HB1239 sponsored by Delegate Phillip A. Scott, empowering localities to cut car tax rates and prevent huge tax hikes driven by driven by dramatic increases in used vehicle values… If local government leadership does not address the increased value of used vehicles, then taxpayers are facing significant tax increases, as the Commonwealth of Virginia constitutionally mandates 100% fair market value in property tax assessments.” [Governor of Virginia]

It’s Tuesday — Clear throughout the day. High of 46 and low of 24. Sunrise at 6:58 am and sunset at 7:30 pm. [Weather.gov]

Morning Poll: Tax cuts or funding boosts?

By ARLnow.com
Virginia Capitol in Richmond (staff photo)

Good news: Virginia is flush with cash.

State tax revenues have been unexpectedly robust — billions more than first anticipated — and that has Republicans and Democrats in Richmond at loggerheads over what to do with the money.

From the Virginia Mercury last month:

Virginia’s new governor marked his 30th day in office with a state tour meant to build support for his tax-cutting plans, which have gotten a mixed response in the politically split legislature.

Parts of it, such as a plan to give every Virginia taxpayer a one-time rebate of $300, have passed with strong bipartisan support. Other proposals, like eliminating the state’s grocery tax and suspending a scheduled increase in the gas tax, have been a tough sell in the Democratic-controlled Senate.

The budget remains in flux, with the state legislature adjourned until a special session is called, allowing lawmakers to work out their differences. While Republicans are calling for nearly $5.5 billion in tax cuts and rebates — plus, more recently, a temporary gas tax holiday — Democrats want more modest tax cuts, targeted to those with lower incomes, while boosting funding for priorities like education.

From the Richmond Times-Dispatch:

The House budget includes almost $5.5 billion in tax cuts and rebates, but the Senate continues to insist on deferring the centerpiece of the governor’s tax plan — the doubling of the standard deduction for income tax filers — until a joint subcommittee completes a comprehensive study of Virginia tax policy in the coming year. Doubling the standard deduction would reduce state revenues by $2 billion over two years.

The Senate has agreed to partial repeal of the 2.5% sales tax on groceries, but has balked at eliminating the 1% that goes directly to local governments and has approved a less generous tax exemption for military retirement income than the House. It also has approved smaller tax rebates this year than the House and rejected a 12-month rollback in the gas tax as meaningless to soaring prices at the pump.

In general, what do you think the state should do with its unexpected extra revenue, if you were to select one thing as Richmond’s top budget priority?

County Manager’s budget proposal focuses on employee compensation

By ARLnow.com
Arlington County Mark Schwartz (file photo by Jay Westcott)

Most homeowners will be on the hook for higher property taxes under a budget proposal by Arlington County Manager Mark Schwartz.

Schwartz’s proposed 2022-2023 budget would fund raises for county employee amid inflation and competition with other local jurisdictions. It would also provide more funding for schools and spend several million dollars on efforts intended to address climate change.

While Schwartz proposed a property tax rate that’s unchanged from 2021, a 5.8% rise in residential property assessments will result in an effective tax hike for most homeowners.

In all, the average homeowner will see a $505 rise in local taxes in fees compared to last year, including $388 in additional property taxes.

Tax and fee burden under proposed FY 2023 budget (via Arlington County)

The budget proposal focuses on attracting and retaining county employees through raises, bonuses and other actions. It includes larger raises for police, fire and other public safety employees, amid ongoing recruiting challenges.

From Schwartz’s presentation to the County Board on Saturday:

Increases to ongoing salaries:

  • 4.25% for general employees
  • 6.50% for public safety employees
  • 3.0% increase to the minimum and maximum of each grade/range

Other actions:

  • $1,600 gross one-time bonus
  • Funded job studies including administrative, parks programming, and library positions ($0.8 million)
  • $1.5 million for the first year of a multi-year effort to address pay compression
  • No premium increase for the self-insured health plan

The pay compression item is intended to address the issue of new hires sometimes making more than employees who have been with the county for awhile, due to increases in pay scales outpacing annual raises.

Other focuses of the budget include housing, climate change and schools, including:

  • An increase in funding earmarked to prevent evictions
  • $4.4 million in climate change initiatives, including up to 53 new electric vehicles for the county fleet and new EV charging infrastructure
  • A 8.7% increase in the budget transfer to Arlington Public Schools, for a total of $576 million

Under the budget proposal, Arlington’s funding for Metro will remain flat at $46.6 million. Covid-related initiatives, mostly from federal funds, include a $3.25 million tourism recovery grant.

The budget totals $1.47 million, a 5.5% increase over last year. Excluding the school transfer, the county government itself would have an operating budget of $894.1 million, a 3.6% year-over-year increase.

At $1.013 per every $100 in assessed value, Arlington’s property tax rate would be lower than the current rates for neighboring Alexandria ($1.11) and Fairfax County ($1.14). Both of those jurisdictions, which saw steeper growth in property assessments this year while the average home value remains below that of Arlington, will be selecting a new proposed tax rate over the next week or so.

Real estate tax and assessment comparisons (via Arlington County)

The County Board is set to vote on advertising a tax rate cap at its meeting tomorrow, then will hold a series of public hearings on the budget and the tax rate at the end of March before voting on a final budget and rate at its Saturday, April 23 meeting.

The full county press release about the proposed FY 2023 budget is below.

(more…)

County Manager proposes no increase in property tax rate

By ARLnow.com

(Updated at 1:45 p.m.) Arlington’s property tax rate would not increase this year, under a proposal by Arlington County Manager Mark Schwartz.

The County Manager’s recommendation for the advertised property tax rate was released ahead of Tuesday’s County Board meeting. The Board will vote at the meeting to advertise a rate, which sets the maximum rate that can be approved in a subsequent budget vote by the Board this spring.

A report notes that due to rises in property assessments this year, setting the same rate will be an effective tax increase on both homeowners and commercial property owners.

“The current base rate is $1.013 per $100 of real estate value,” says the report. “For FY 2023, this tax is projected to generate $852.2 million, which is 6.0 percent ($47.9 million) above FY 2022.”

“The average home value is up 5.3 percent over last year, from $724,400 to $762,700,” the report adds. “Overall, commercial property assessments increased by 0.6% over the previous year. At the current real estate rate of $1.013 plus the $0.017 rate for stormwater, the average Arlington homeowner would pay $7,856 per year in real estate taxes, a $395 or 5.3 percent increase over CY 2021.”

To generate the same property tax revenue as last year — an unlikely prospect given that the county previously referenced a “challenge in balancing the FY 2023 Budget” giving rising expenditures —  the Board would have to lower the tax rate significantly.

“The tax rate which would levy the same amount of real estate tax as last year, when multiplied by the new total assessed value of real estate with the exclusions mentioned above, would be $0.990 per $100 of assessed value,” the report says.

Among Schwartz’s other budget recommendations, the Board will consider lowering the annual Household Solid Waste rate from $318.61 to $307.89, thanks to a rise in the value of recycled material. Additionally, fees for ambulance transport services are set to be raised to between $750-1,000, depending on the level of care, which a Board report says is in line with the fees charged by other D.C. area jurisdictions.

Most-read Arlington stories of the week: Jan. 31-Feb. 4

By Brandi Bottalico
Rain puddles in Shirlington (staff photo by Jay Westcott)

It was quite a week.

There was everything from breaking news, like the county finalizing a new jail medical provider after the latest inmate death, to helpful stories like where to stock up on Girl Scout cookies. And you all seemed particularly interested in stories about wayward poultry and an aggressive fox.

Here are the most-read Arlington articles of the past week.

  1. Rogue chicken caught sneaking around Pentagon entrance
  2. Crawfish eatery Chasin’ Tails is leaving Arlington for Falls Church
  3. Fox menaces Gulf Branch neighborhood, leading to rabies warning
  4. Another death reported at Arlington County jail
  5. Two arrested after assaults at Columbia Pike businesses over the weekend
  6. As the ranks of freelancers swell, the taxman cometh for those in Arlington
  7. Covid case counts decline to pre-Christmas levels in Arlington
  8. Arlington is phasing out EasyPark devices this month
  9. Girl Scouts bring back more in-person cookie sales, starting this week
  10. Clarendon salon launches gender-neutral pricing model

Feel free to discuss those stories or anything else of local interest in the comments. Have a great weekend and stay warm, Arlington!

As the ranks of freelancers swell, the taxman cometh for those in Arlington

By Jo DeVoe
Money (by Sharon McCutcheon/Unsplash)

The pandemic has seen a rise in freelance and contract work from those looking for job flexibility.

What new freelancers may not know is that Arlington tax code says they need a permit to work from home and need to pay local business taxes, just like any other business or contractor.

COVID-19 has seen tremendous changes in how Americans work, where and for whom. People are taking their computers to exotic locales or states with lower living costs, while companies are rethinking their office leases or trying to make their offices more attractive. Meanwhile, many are leaving their jobs to strike out on their own as freelancers.

But one area is experiencing delayed shockwaves from these seismic shifts: taxes. Last year folks saw taxes rise or fall depending on where they worked from home or if they could write off their home office. With the second pandemic-era tax season dawning, here’s what independent workers of Arlington need to know.

  1. The county keeps track of independent workers, requiring them to get a permit certifying their “definite place of business” is in Arlington.
  2. Every business with a definite place of work in Arlington is considered taxable.
  3. Business license taxes are calculated before expenses in Arlington.
  4. License tax rates are fixed until gross receipts exceed $100,000, at which point they’re calculated on a variable rate.

Independent workers can deduct their expenses from their state and federal taxes, but locally, Arlington’s Business, Professional and Occupational License (BPOL) tax collects on pre-expense revenue, or gross receipts.

Businesses with receipts less than $10,000 owe nothing, while those grossing up to $50,000 pay $30 and those grossing up to $100,000 pay $50. After $100,000 over, the annual tax is $0.36 for each $100 of revenue.

“Customers can get confused and think that they should pay a flat fee for gross receipts up to $100,000, plus the tax rate on the remaining receipts, however, the correct amount to file and pay is based on multiplying the total gross receipts by the tax rate,” said Susan Anderson, the communications director for Arlington’s Office of the Commissioner of Revenue.

She says every person engaged in business in Arlington — whether a home or a co-working space — is subject to the BPOL.

“Anyone who is not an employee and who works as an independent contractor has a taxable business,” Anderson said. “It is not necessary to incorporate as an LLC or corporation in order to conduct licensable business activities.”

This is not a new tax being enforced, but she encouraged independent contractors with questions to contact the office’s Business Division Tax Specialists at (703) 228-3060 or email [email protected].

“Our staff is very happy to assist,” she said. “Also, as a reminder, the Business License Tax filing and payment are due annually on March 1.”

The BPOL tax is Arlington’s third-largest source of revenue behind real estate and personal property taxes, including car taxes. For the 2019-20 fiscal year, the BPOL tax netted $72 million, according to the 2022 adopted budget. It’s estimated to net $63 million for the 2020-21 fiscal year and could bounce back to $72.5 million in the 2021-22 fiscal year.

Criticisms of the BPOL 

The tax has long had critics who have called for its elimination — to the worry of Arlington County tax officials.

On the right and the left, in Arlington and at the state level, critics have argued for years the BPOL hurts small businesses, particularly those with razor-thin profit margins, as well as startups and entrepreneurs, while large companies — such as Arlington-headquartered Lidl and Nestle — have avoided it in Arlington because their sales happen elsewhere. The same could happen for Amazon.

Some Virginia writers who argue they’re hurt by BPOL took their battle to the courts and one court ruled in their favor.

(more…)

JUST IN: County reports another jump in residential real estate assessments

By ARLnow.com
Townhomes in the Green Valley neighborhood (staff photo by Jay Westcott)

Arlington is seeing another big jump in residential property assessments this year, something that should bolster the county’s finances but hit the pocketbooks of local homeowners.

While a county press release, below, described “modest” growth in Arlington’s property tax base, it was a tale of two types of property.

On one hand, commercial property like office buildings and hotels, struggling with vacancy during the pandemic, is up only 0.6%. It’s an improvement from last year, when commercial property dipped 1.4%.

In line with the rise in local home prices, on the other hand, residential real estate assessments are up 5.8%, the county announced. That’s above the 5.6% rise in residential assessments last year and the 4.3% increase the year before that.

“The increase in property values for this year shows the attractiveness of our Arlington community, even as our community continues to face challenges brought by the ongoing COVID-19 pandemic,” County Manager Mark Schwartz said in a statement. The county’s press release notes that new construction “contributed 1 percent of the 3.4 percent overall tax base growth.”

The overall 3.4% rise in property values will mean a corresponding rise in property taxes, the county’s biggest single source of revenue.

Arlington’s revenue sources from Fiscal Year 2021 (via Arlington County)

Rising property taxes should help bolster the county’s finances as budget season gets underway. In its press release, however, the county said that rising workforce costs, Covid challenges and other pressures “will continue to be a challenge in balancing the FY 2023 Budget.”

Schwartz is set to present his recommended budget to the County Board next month.

The full press release is below.

Arlington’s overall property tax base grew modestly from 2021 due to continued residential growth, while commercial values were relatively flat.

Measured growth in residential property values buoyed the tax base, but the County continues to face challenges in balancing the FY 2023 budget due to the lingering effects of the COVID-19 pandemic.

Overall, the total assessed value of all residential and commercial property in Arlington increased 3.4 percent, compared to the 2.4 percent growth in 2021. Residential property values increased 5.8 percent overall, while commercial property values increased by 0.6 percent. Overall, new construction in the County contributed 1 percent of the 3.4 percent overall tax base growth.

“The increase in property values for this year shows the attractiveness of our Arlington community, even as our community continues to face challenges brought by the ongoing COVID-19 pandemic,” said County Manager Mark Schwartz.

Real estate taxes provide almost 60 percent of total County revenues. The County’s real estate tax base is spilt roughly equally between residential (54%) and commercial (46%) property assessments.

The slight increase in commercial property assessments demonstrates some growth in our business market and a rebound closer to pre-pandemic levels. After experiencing double-digit decreases in 2021, hotel property values increased by 5.6 percent as occupancy and room rates gradually recover from the initial impacts of the pandemic.

Apartment property values also saw an improvement, growing 5.3 percent from the previous year. Just under half of the growth was due to new construction, reflecting continued demand for residential development.

General commercial property (malls, retail stores, gas stations, commercial condos) values decreased, reflecting continued impacts of the COVID-19 pandemic on retail stores and restaurants. Office property values also decreased due to rising vacancy rates and changing demand for office space.

The 5.8 percent increase in residential property values increased the average single-family property from $724,400 to $762,700. For CY 2022, approximately 73 percent of residential property owners saw their assessed value increase while the rest remained unchanged or declined. Residential properties include condominiums, townhouses and detached homes.

Notice of Assessments will be mailed to Arlington property owners beginning January 14. Assessment information will be available online Friday, Jan. 14, after 11 p.m.

(more…)

H&R Block on Columbia Pike closed, as redevelopment of building nears

By Matt Blitz
1/3

The H&R Block on Columbia Pike has closed, even with tax season just around the corner.

The signage has been taken down from 2607 Columbia Pike and all the furniture is gone, leaving only beige carpet and scattered cords.

A company spokesperson tells ARLnow that the office is being relocated and is “working as quickly as possible to reopen,” but didn’t give a reason why the tax preparation company closed this particular location.

The closure likely has something to do with the approaching redevelopment of Fillmore Gardens Shopping Center, which housed the tax preparation company’s local storefront.

All the tenants at the shopping center, including Legend Kicks, Atilla’s Restaurant, and the Columbia Pike Partnership (CPP), received a notice to vacate by May 31 of this year, according to CPP’s deputy director Amy McWilliams.

Over the last two years, several have already moved out, including the Salsa Room in early 2020.

The plan is to replace the one-story aging structure, located just west of Penrose Square, with the Elliott, a multi-story, mixed-use building with about 250 apartments and 50,000 square feet of ground-floor retail space. There will be a renovated CVS and a grocery store, according to Urban Turf.

There are rumors that the grocery store could be an Amazon Fresh location. The shopping center is located about two miles from Amazon’s under-construction HQ2 in Pentagon City.

Developer Insight Property Group says on its website that construction on the redevelopment project is expected to begin this year. ARLnow has reached out to the company for more information about plans and the project, but has yet to hear back as of publication.

A spokesperson for the county tells ARLnow the project could kick off as early as February. That’s when the County Board will likely consider a special use permit which will allow developers to finalize engineering, building, and landscaping plans, and demolition by the fall.

“In this scenario, construction would likely conclude by early 2025 at which point the new building could begin to be occupied,” writes Erika Moore, a spokesperson for the county’s Department of Community Planning, Housing and Development.

During construction, CVS is expected to move its pharmacy services to a trailer in the existing parking lot, notes Moore. The trailer will remain open until the project’s completion, at which point CVS will relocate into the new building.

The county couldn’t comment on the status of the other tenants.

Morning Notes

By ARLnow.com
Ballston in the snow (staff photo by Jay Westcott)

More Snow Looks Likely This Week — “Believe it or not, we have a chance of more accumulating snow Thursday night. This is unlikely to rival today’s storm, but could produce a few inches in parts of the region depending on how it evolves.” [Capital Weather Gang]

Local Legislative Event Now Virtual — Today at 7 p.m., the League of Women Voters of Arlington and Alexandria City will host a public forum for locals to speak with their representatives to the state Senate and the House of Delegates. The event has moved to Zoom due to rising Covid concerns. A Zoom link will be provided to those who register online. [Eventbrite]

Video: Motorcycle Ride in the Snow — “Last time I rode a scooter in the snow was in Seoul Korea. Wanted to see how it is in Northern Virginia. Took it from Clarendon to Courthouse for lunch. The snow is packed and icy, so not possible to drive fast except on the main roads in some parts. I had a couple close calls where the tire slipped sideways.” [YouTube]

Bill Would Nix Arlington SRO Decision — “The Arlington School Board would be required to reinstate school-resource officers at local schools under legislation to be considered in the upcoming General Assembly session. Among those putting in bills on the topic is Del.-elect Timothy Anderson (R-Virginia Beach), whose measure – HB37, filed Dec. 30 – would require every school system to sign agreements with law-enforcement agencies to provide at least one resource officer for every high school and middle school, and at least one officer for every five elementary schools.” [Sun Gazette]

Reminder: Bag Tax Now in Effect — “Arlington County will begin imposing a 5-cent plastic bag tax… Effective Jan. 1, 2022, [Arlington, Alexandria and Fairfax County] will tax plastic bags from grocery stores, convenience shops and drugstores.” [ARLnow]

It’s Tuesday — Today will be sunny, with a high near 37 and a low of 27. Sunrise at 7:27 a.m. and sunset at 4:59 p.m. Tomorrow will be mostly cloudy, with a high near 44, a low of 32 and wind gusts as high as 18 mph. [Weather.gov]

View More Stories