Can we do this? Can the Little City of Falls Church absorb a 20-cent tax rate hike and by so doing, preserve its world-class schools and keep the fundamentals of a solid, caring, unique and vibrant community alive? With a lot of ingenuity and smart thinking, we think so.

From a fiscal point of view, things couldn’t be much worse for Falls Church. The nosedive in residential and commercial real estate values has been coupled by a jaw-dropping drop in sales tax revenues (partly due to an accounting correction coming out of Richmond) and a court ruling cutting off abruptly a water fund revenue stream that supplied an equivalent to nine cents on the tax rate. New development in the commercially-zoned corridors of the City has ground to a halt, and the City has dipped deep into its “rainy day” fund balance far beyond the level established as City policy and that credit rating agencies want to see.

The News-Press began at the outset of the last big recession in the early 1990s, but we’ve never seen anything resembling the hardships now facing the City as it crafts its Fiscal Year 2011 budget. In addition, no one is predicting that things will get a lot better in a hurry.

However, there are ingenious ways that individual communities can avoid the worst, and even gain a relative advantage in such tough times, and Falls Church has the opportunity to do just this.

The best remedies are: (1) to attract and nurture affordable public beautification efforts and creative private-sector developers who are not afraid to push the design envelope to make being in and around their work especially attractive, who are able to find the money to build; (2) to maintain and enhance intangible “value-added” components of the community, such as a first-rate school system and a visible commitment to affordable housing.

The City of Falls Church is churning on all cylinders with respect of all of these. It’s using federal stimulus money to proceed with its North Washington St. landscape plan, and we haven’t seen the last art nouveau-themed building in the City. It’s no surprise that the colorful new “Flower Building” on West Broad, even with commercial vacancy rates in double digits throughout the region, will soon be filled to capacity. The school budget going forward this spring includes unfortunate cuts, but the integrity of the classrooms are maintained, and the City Council is showing the grit required to press on with a senior affordable housing project, The Wilden, that runs counter to the common approach to austere times, but that speaks volumes about the values of the community.

These are the kinds of counter-intuitive moves that will position Falls Church for a solid economic recovery, even as things might get worse before they get better for much of the rest of the region, the state and the planet.