Richard Barton

Our Man in Arlington

The initial shock Arlington property owners suffered when we received our 2005 assessment notices has worn off, and we are now looking at ways we can alleviate the pain.

Actually, most property owners have become inured to the shock, since property values have been skyrocketing for several years. All of us have our favorite stories about how we paid $30,000 for a house thirty years ago that recently sold for $800,000, only to tear down the house and build a $2,000,000 property – or something like that. The escalation of real estate values has made many of us very comfortably off, at least on paper.

The rub, of course, is that real estate taxes are going up, too. And there are many whose incomes have not risen at the same dizzying pace as real estate values. What looks great on paper can become a nightmare for a relatively small but important part of Arlington’s population.

Local jurisdictions are remarkably limited in what they can do to alleviate the pain because of state laws and local fiscal realities. State laws limit local jurisdictions in the types of taxes they can collect, virtually guaranteeing that real property taxes are the mainstay of local government financing. Local governments cannot charge different rates for commercial and residential properties – preventing a shift of the tax burden from homeowners to businesses. State law also prevents us from charging different rates based on the ability of a customer to pay. And we cannot subjectively manipulate assessment values. They must be an accurate reflection of fair market value.

And recent legislative attempts to propose a Virginia constitutional amendment for homestead exemptions have failed.

The alternative, a major reduction in real estate tax rates, is not a realistic option either. Most Arlington citizens have shown no desire for a substantial reduction in county services that would be required by a major reduction in the real estate taxes. The County Board will most likely drop the rate by five cents or more next month, thus guaranteeing that we continue to have the lowest rate of any major Washington metropolitan area jurisdiction. Even so, most Arlington property owners will see their real estate taxes rise once again.

There is some help. Homeowners who are 65 and older and some disabled residents may be eligible for exemption or deferral of real estate taxes based on income and assets. And a few low-income renters may be eligible for Section 8 housing grants, though these do not directly deal with real estate taxes.

The Arlington County Board has appointed a Homeowners Grant Panel, of which I am a member, to come up with recommendations for relief for the most pressed homeowners. We are now working on a county staff proposal that would provide specific monetary grants ($500 is the figure we are now discussing) to homeowners meeting fairly stringent income and assets tests. We are due to submit our recommendations to the County Board early next month.

As good as this idea may be, it still will provide only a limited amount of tax relief for those who are least able to pay an ever-increasing real estate tax burden. Substantial relief probably cannot come until the state provides localities with far more flexible systems of taxation and/or adopts the homestead exemption amendment. Don’t hold your breath.

Richard Barton may be emailed here.