Fairfax County is blessed with “a very unusual group of politicians,” according to the head of the county’s Economic Development Authority (EDA), responding to the recent remark by Sharon Bulova, new chair of the county Board of Supervisors, that she “will not vote for any cut in economic development” despite a $700 million shortfall currently being addressed in the next fiscal year budget.
Economic growth and job creation are seen as the key to the county’s future prosperity.
Dr. Gerald L. Gordon, president and CEO of the county’s dynamic EDA, addressed a meeting of his City of Falls Church EDA counterparts at the F.C. City Hall Tuesday to tell them how his organization recently landed the relocation of the major corporate headquarters of Exxon-Mobil, Volkswagen, and most recently, the Hilton Hotel chain in the county.
But while he focused on the successes of his organization, he was effusive in praise for the county’s political leadership, singling out Bulova’s comment.
“Every county entity was told going into the current, difficult budget cycle to present a budget 15 percent lower than the previous year’s,” Gordon noted. “We complied, while commenting on the damaging effects the cuts would cause us.”
Then, he said, County Manager Anthony Griffin presented his recommended budget to the County Board, and he reduced the cut in the EDA budget from 15 to six percent. Now, despite deep cuts in almost all county programs, he quoted Bulova and is hopeful that his authority will receive the same $7 million funding level it’s enjoyed for most of the past decade.
Clearly, the EDA’s work is perceived as essential to future revenue growth to relieve budgetary pressures and to create jobs in the future, Gordon explained, as commercial development is a major net plus, requiring only 50 cents in services for every dollar it returns to the county’s tax coffers. Even in the current recession, with national unemployment near nine percent, the county has enjoyed a net increase in jobs.
“Despite having the highest, or second-highest, income per capita of any jurisdiction in the nation,” Gordon pointed out, “We are disadvantaged by Virginia law which prohibits localities from imposing an income tax. Therefore, we depend on residential real estate taxes, and that can be relieved only by tax revenues generated by commercial development.” Residential growth costs exceed tax revenues generated from it, unlike commercial growth.
Thus, he noted that because of the county’s success at economic development, residential real estate taxes have declined since 1990, despite more than doubling of the residential population.
Gordon said his EDA’s mission is very focused at bringing new businesses to the county, with up to $2 million of its annual budget going directly to advertising and a staff of 48 commandeering six external offices, five overseas and another in the U.S. in San Francisco.
He suggested to his Falls Church counterparts that the City, with a population of 11,400 in 2.2 square miles compared to the county’s over one million population, focus on attracting small to mid-sized companies, instead of corporate giants.
In the case of the recent decision by the Hilton Hotel chain to locate its world headquarters in Tysons Corner, he suggested that Falls Church might go after attracting the many smaller feeder or supplier businesses that service the Hilton chain and are scattered around Hilton’s current headquarters in Beverly Hills, Calif.
Companies are interested in relocating out of California now because of excessive over-regulation, citing overly-strict parking ratio mandates as among them.
“Companies like Fairfax County because of the responsiveness of its government,” he said. “Taxes aren’t a big issue unless they are really extreme.”
He said that despite size differences, Falls Church and Fairfax County “bring many of the same assets to the market” in pursuing business relocations, retentions and start-ups here.
“We share our proximity to Washington, D.C., though nobody wants to be right in D.C. because it has nothing but lawyers,” he quipped. He said the two Northern Virginia jurisdictions also share their proximity to major airports, to an East Coast location nearer to Europe and the U.K., a good quality of life and, he stressed, quality public education systems.
He said that corporate interest in quality education as a condition for relocating is “stunning.” Good schools attract the best work force, he noted. Since coming to Fairfax County, Volkswagen has given $2 million to local schools, including George Mason University and NOVA, and Hilton is also known for outstanding “corporate citizenship,” he said.
The success of Fairfax’s EDA has resulted in the fact that Northern Virginia is one of only four regions of the U.S to experience job growth, even as the national unemployment rate approaches nine percent. Only Denver, Dallas, Boston and Northern Virginia have enjoyed a net gain in jobs, he pointed out. There are now 620,000 jobs in Fairfax County, more than any other area of the greater D.C. region, including the District, itself, which has 580,000 jobs.