Backgrounder: The Proposed Reston Transportation Tax District
What is the proposed special Reston transportation tax?
The County Transportation staff (FCDOT) has proposed to the Supervisor-appointed Reston Network Analysis Group (RNAG) that a special “transportation service district” tax be created just for Reston to help pay for street improvements in Reston’s station areas. The tax would apply to both Reston’s commercial and residential development and the rate could be altered by the Board of Supervisors any time.
- One version of the tax would impose a $.035/$100 valuation tax on the station areas.
- A second version would add a $.025/$100 valuation tax to all Reston homeowners.
The funds generated by the tax would be used for the construction and maintenance of roadways in Reston’s Metro station areas, including the new “grid of streets” within each area and improvements to through streets, such as Reston Parkway. FCDOT puts the cost of these improvements at $2.6 billion. The goal of these improvements would be to achieve a peak hour intersection delays of 55-80 seconds, worse than the current County goal of 30-55 seconds delay, even on Reston’s major through streets.
How much would this transportation tax district cost Reston homeowners?
Like a property owners’ regular property tax bill, the cost of the tax to Reston homeowners would vary depending on the value of their homes. Here is a table FCDOT has provided on the annual cost in today’s dollars. We’ve have highlighted the two tax rate proposals FCDOT has proposed:
What the above “constant” 2016 dollar table does not reflect is the impact of home appreciation on tax assessments and out-of-pocket tax payments. Three percent appreciation per year at a tax rate of $.025/$100 valuation over four decades on a $600,000 home would more than triple the tax cost:
Over the next 40 years of a community-wide transportation tax fixed at $.025/$100 valuation, Reston homeowners would pay more than $350 million in special Reston-only transportation taxes.
Who benefits from the new Reston transportation tax?
The short answer is that Reston residents would have an added tax burden with no discernible benefit while landowners’ for-profit development is subsidized by homeowner taxes and the County has a new tax revenue stream.
Reston residents would be paying for roadways that everyone else uses for free. Free users include more than half of the daily commuters who live elsewhere as well as shoppers and diners in Reston’s station areas, present and future. If taxed, Restonians using the roads would receive no unique benefits in the station areas, including free parking. And, as stated above, homeowners would be paying added taxes to drive in worse traffic conditions than they now experience.
On the other hand, the transportation tax subsidy from Reston homeowners would lower the costs Reston’s developers face in building the needed streets their for-profit endeavors, generating more tenants, customers, and rental and sales revenues. Yet even if Reston homeowners do not pay a special tax, the developers will still build or improve the roads to meet County requirements. The road improvements would cost them less than five percent of their forecast $53 billion in profits in the next four decades. Of course, if the developers choose not to develop, the added roads and improvements will be unnecessary.
For the County, the new Reston transportation tax district would mean a new tax revenue stream at its disposal whose rates the Board of Supervisors controlled. Not only would the new $.025/$100 valuation tax mean an added $4 million per year to start in revenues from Reston homeowners, but the County revenue tax stream will grow as Reston home values appreciate and developers construct their high-density buildings.
You must act now. The proposed Reston transportation tax district provides no linkage between who pays and who benefits. It is grossly unfair and inequitable to all Reston homeowners. Please contact these key County and community officials to share your views on this deceptive Reston transportation tax proposal.
Chairman Sharon Bulova firstname.lastname@example.org
Supervisor Cathy Hudgins email@example.com
Tom Biesiadny, Chief, FCDOT firstname.lastname@example.org
Kristin Calkins, RNAG Project Manager email@example.com
Cate Fulkerson, CEO, RA Cate@reston.org
Andy Sigle, Chief, RNAG Advisory Group firstname.lastname@example.org