Housing, Workforce Among Top Priorities In Arlington's Budget Proposal

ARLINGTON, VA — Arlington's homeowners can expect to pay about $454 more in annual property taxes and fees under a fiscal year 2024 county budget proposal, released Saturday, totaling $1.54 billion.

The proposed budget, announced by County Manager Mark Schwartz, amounts to a $42.1 million, or a 2.8 percent, increase over the county's fiscal year 2023 budget.

If approved by the Arlington County Board, the proposed budget would keep the current real estate tax rate at $1.013 per $100 of assessed value. But residential real estate assessments in Arlington have climbed by 4.5 percent on average, increasing the amount of property taxes that homeowners will likely have to pay.

The county board is expected to hold public hearings in March on the proposed budget, with adoption of the fiscal year 2024 budget scheduled for April 22. The new fiscal year begins July 1.

Unlike a year ago, when the nation was seeing a surge in the valuation of vehicles, county staff are not recommending a decrease in the tax rate on personal property for fiscal year 2024.

For the previous fiscal year, the Arlington County Board adopted a budget that included vehicle tax relief by adjusting the assessment tax ratio to 88 percent of a car’s value. For fiscal year 2024, Schwartz told county board members that his proposal assumes a 100-percent valuation of vehicles due to the slowdown in the increase in the value of vehicles.

A top concern for Arlington officials remains the high vacancy rate among commercial properties and its impact on taxes. Even with Amazon expected to begin filling the first phase of its HQ2 in Pentagon City later this year and other companies moving their headquarters to Arlington, the county is looking at ways to fill office space along the Rosslyn-Ballston corridor.

At a budget briefing with reporters on Tuesday, Schwartz said the commercial vacancy rate in Arlington is at a record 22.1 percent, even higher than in the aftermath of the federal Base Realignment and Closure Commission, or BRAC, process, when the county lost thousands of military and defense-related jobs.

Last month, the Arlington County Board amended the Arlington County Zoning Ordinance to expand the number of permitted uses in commercial and mixed-use zoning districts to include urban colleges and universities, urban agriculture, office and urban agriculture, retail, artisan beverage and artisan workshop uses.

With changing trends in workspace since the start of the COVID-19 pandemic, the new uses provided by the county's zoning changes are designed to give commercial property owners additional tools to make underused office space more attractive to potential tenants.

Similar to the fiscal year 2023 budget, one of the spending priorities in the new budget is workforce investment, Schwartz said. General county employees would see a 4.5-percent salary increase under the proposed budget, while uniformed police would see a 10-percent salary increase and uniformed sheriff’s office employees would see an 8.5-percent increase. In the previous fiscal year, the county board approved a 13.5-percent salary increase for uniformed police officers.

Despite the increasing spending on police salaries, the county police department still has about a 15-percent vacancy rate, Schwartz said at Tuesday's briefing. Arlington, like other jurisdictions in the Washington, D.C., area, continues to experience challenges with the recruitment of police officers, he said.

The fiscal year 2024 proposed budget also emphasizes housing assistance, including spending on housing grants and an eviction prevention program. Over the past four years, especially since the start of the COVID-19 pandemic, the county has dramatically increased its spending on preventing residents from getting evicted from their homes, Schwartz noted.

In December 2021, the county board also provided a $150 million loan to support the acquisition of the Barcroft Apartments on Columbia Pike by Jair Lynch Real Estate Partners. The county loan supported the preservation of all the Barcroft apartments as affordable units.

Due to skyrocketing interest rates over the past year, Schwartz said he is proposing the county approve the use of the nearly $4 million from what is known as the Columbia Pike tax increment financing fund and ongoing county funding for affordable housing units to cover about $5 million in debt servicing on the $150 million loan in fiscal year 2024.

At Saturday's meeting, Schwartz told the board that he plans to present a long-term strategy for financing the Barcroft affordable housing deal later in 2023.

RELATED: Arlington County Board Adopts $1.5B Budget, Tax Rate To Stay Same