F.C. School Board Adopts Noonan Plan; City Income to Beat Outlook

REVIEWING DATA on the City’s fiscal health Tuesday, members of the Falls Church City Council watched a Powerpoint presentation. Shown here are (l. to r.) Letty Hardi, Ross Litkenhous, Mayor David Tarter and Vice Mayor Marybeth Connelly. (Photo: News-Press)

The Falls Church School Board’s budget request to the City Council that was approved at its meeting Tuesday night was effectively unchanged from that recommended by Superintendent Peter Noonan last month, even though the City Assessor’s Office reported higher than expected assessments on City properties last week.

The Noonan/School Board budget will not require any increase in the real estate tax rate.

But, the higher than expected assessments will generate about $400,000 more than projected last November for the coming fiscal year, F.C. City Manager Wyatt Shields told the News-Press Wednesday.

The real estate assessments overall, which were released just before News-Press press time last Wednesday, are up almost a full percentage point higher than earlier projected, at a rate of growth of 3.35 percent.

Many residents began receiving by mail the notification of their new assessments from Assessor Ryan Davis this week. Most of the increases in assessed values are the result of “market appreciation,” Shields told the News-Press, as compared to new construction in their the residential or commercial real estate sectors.

Due to market appreciation, for example, residential condominiums rose in value an average of 4.91 percent, with some properties in the Winter Hill condominium community rising by almost 10 percent. By contrast, the appreciation of values of single family homes rose by 2.87 percent and townhomes by 1.02 percent.

No new condominiums have been built in the City in over a decade, since before the housing crisis that precipitated the Great Recession of 2007, and some builders had to switch from condos to rental units to secure the financing to complete their projects (such as Pearson Square). But for the first time last month, a developer has proposed up to 100 new condominium units, this by the EYA, PN Hoffman, Regency group for the West End project in modifications just made to their November proposal. That plan also includes a novel proposal to construct up to 175 new “micro unit” residential rentals, a first for that housing product in the City in its history.

The recent modifications reflects, apparently, the sudden popularity of existing condominiums in the City. The smaller, more flexible units offer the prospect of relative affordability for the younger workforce population which has had an historic problem being able to afford to own a home in Falls Church.

It remains to be seen what some of the collateral effects of this new popularity of smaller condominiums will be, such as whether they will attract families with school aged children that the City will have to spend on educating, or whether they will be too small to attract that element, who may wish to nurture children there in preschool years only.

(Despite their small size, most of the condo units in Winter Hill are two bedroom, having been converted to condos in the early 1970s from post-World War II GI Bill housing when they were first constructed as the Tyler Gardens project in 1947, and therefore are actually larger than many of the condos and single-room or small one-bedroom micro unit products now being proposed.)

By contrast to the robust market appreciation factor (at least for condos), new construction accounted for only 31.7 percent of the increase in assessed values in the City in the past year, as there were groundbreakings on no new big mixed use projects in the past year. That should change in the current year, however, as the official groundbreaking for Mill Creek’s new, 4.3-acre Founders Row project on the northeast corner of W. Broad and N. West Streets is slated for next month.

That will be the biggest project in the history of Falls Church, even though the West End project, covering 10 acres, now being planned will be more than double its size, and the Broad at Washington Project of the Insight Group has already been approved but complications (the arrest and conviction of former project partner Todd Hitt on fraud charges) has delayed it.

While moving Tuesday night to forward the same budget request as that recommended by Superintendent Noonan last month, the School Board indicated its intent to take into account this week’s higher than expected revenue numbers for the City after its budget is approved by the City Council in April and comes back for a final consideration by the board.

The Noonan budget unveiled on Jan. 8 was fashioned to keep the growth of the Schools’ budget within the parameters of November’s budget guidance, when revenue growth overall was expected to be 2 percent rather than 2.5 percent. That budget, at $52,137,504, was aimed at doing the Schools’ part to keep expenses growth to a level that would not burden City taxpayers with a rate increase. Still, it would provide a “step” salary increase at an average of 2.95 percent and a one percent cost of living (COLA) adjustment for all teachers and school employees, increasing the average cost per student among the 2,680 in the system to $19,152, while maintaining small class sizes.

The School Board budget approved Tuesday, then, will come to the City Manager, who will craft his recommended budget for presentation to the City Council on March 11 that will include whether or not he will recommend a real estate tax rate increase, decrease or no change in the current $1.355 per $100 in assessed valuation rate.