Backgrounder: The Proposed Reston Transportation Tax District, Reston 20/20, April 20, 2016

             

April 20, 2016

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.

Name                                                                                    E-Mail
Chairman Sharon Bulova                                                    chairman@fairfaxcounty.gov
Supervisor Cathy Hudgins                                                   huntermill@fairfaxcounty.gov
Tom Biesiadny, Chief, FCDOT                                            tom.biesiadny@fairfaxcounty.gov
Kristin Calkins, RNAG Project Manager                              kristin.calkins@fairfaxcounty.gov
Cate Fulkerson, CEO, RA                                                   Cate@reston.org 
RA Board of Directors                                                         Board@reston.org
Andy Sigle, Chief, RNAG Advisory Group                          awsigle@gmail.com

Reston’s Coming Urban Area Transportation Network: An Early Look at the Cost of Streets and Transit in and around Reston’s Station Areas

   Reston’s Coming Urban Area Transportation Network: An Early Look at the Cost of Streets and Transit in and...

Keeping Tabs on the Reston Network Analysis Group

The Reston Network Analysis Group has been meeting for three months, but little of what it has heard or said has been broadly shared with Restonians although some of what it has heard is on the County's Reston Network Analysis Group webpage.  So, we have decided to make available to you the presentations and minutes of the RNAG meetings on this blog so you can keep track of what is going on.  Where possible, we'll try to provide a brief overview of each of the presentations here.

Presentations

Reston Network Analysis - Existing Conditions - Stakeholders Meeting: Nov. 20, 2015 

This presentation lays out the goals and methods of the RNAG study.  It includes detailed technical results of transportation models run on the Dulles Toll Road as well as the existing conditions at the intersections on the major Reston roadways (e.g.--Reston Parkway and Sunset Hills) and walksheds.

Reston Funding Plan:  Potential Sources for Revenue for Funding Reston Transportation Improvements, December 14, 2015

This presentation examines the various sources of revenue that may be used to fund the $2.63 billion cost of implementing Reston's major transportation improvements.  Some of these require authority from the state, others do not.  It describes how the Tysons infrastructure funding effort works.

Reston Network Analysis--2050 Unmitigated Results--January 11, 2016

This presentation lays out the results of FCDOT's 2050 simulation of traffic conditions in the Phase 1 (station areas plus Reston Town Center).  It focuses on the major intersections, which broadly failing, but also includes data on the network of local streets.  It also describes the "tiered approach" to mitigating traffic delays from least costly to most costly.

Reston Network Analysis--2050 Unmitigated Results--January 15, 2016

It is not clear what difference there is between this copy of the presentation and the one above.

 Reston Network Analysis--Community Kick-Off, February 1, 2016

 This is the briefing FCDOT provided a community meeting on the RNAG's efforts.  It describes the Phase 1 Comprehensive Plan that is driving the work of RNAG and concurrent Reston efforts, focusing on the need for a "grid of streets" within the station areas (although little of the preceding suggests RNAG has discussed the grid very much).  It provides an overview of the traffic conditions current and future plus a summary of the mitigation strategy.  It describes the process with working with the community and stakeholder groups--which are different--as well as the public. 

Minutes
 
September 15, 2015 Minutes

Described as the second meeting of the RNAG (there are no earlier minutes), these minutes focused on the process for proceeding with the study.  

 November 9, 2015 Minutes

The meeting seems to have focused on the existing conditions with a preliminary overview of the funding issues.

 December 14, 2015 Minutes

The meeting focused on the Reston funding plan presentation above. 

 

Op-Ed: Who Will Pay for Reston’s Infrastructure Development? Terry Maynard, RestonNow,, February 8, 2016

The following is a re-post of the subject op-ed in RestonNow written by Terry Maynard.

This is an op-ed submitted by Terry Maynard, co-chair of Reston 2o20. It does not reflect the opinion of Reston Now.

On Thursday, Feb. 11, the Greater Reston Chamber of Commerce is sponsoring a seminar called, “The Changing Future of Reston, ” but — as the agenda shows — it’s really about who will pay for the added public infrastructure the intense private development of Reston’s urbanizing corridor will require.

Noting that Fairfax County has identified $2.63 billion in needed transportation improvements because of the expected Metro-related development, the Chamber agenda includes:

During the first half of 2016, the County expects to settle on a plan:

• Who should build the new transportation improvements; and
• Who should pay for them; and
• What revenue sources should be used to pay for it (sic). Potential revenue sources include federal, state and/or county taxes, new or expanded tax districts on existing businesses and residents, proffers or other vehicles, with collections commencing as early as 2017.”

And the panelists? Two developers, the chief of the county transportation staff, and RA’s Chief Executive Officer, all led in their discussion by a developer-paid Reston land use attorney.

It doesn’t take much thought to figure out where this discussion is headed: Developers are looking for ways and rationalizations to shift the infrastructure cost burden to others. And the only significant option within the County’s control is shifting the cost burden to us, its residents.

The Reston 20/20 Committee has stated since its creation seven years ago that those who stand to benefit financially from development should be the ones who pay the costs of making it work. At the same time, Reston 20/20 has regularly encouraged appropriate high-density transit-oriented mixed-use development in our station areas with the necessities and amenities expected in our special planned residential community as a means to facilitate our community’s continued economic, cultural,  intellectual, and recreational growth. We believe it is important to sustain, if not improve, our quality of life.

We stand by that thinking as the county — and the Chamber of Commerce — moves forward in looking at who should pay for the infrastructure required to support the doubling of Reston’s population and jobs (most of it along the Dulles Corridor) over the next 30-40 years.

That said, virtually no Reston resident will accrue any financial benefit — even an appreciation in home value — by the building of an office or residential building, say, near the Wiehle Metro station. Yet that construction will generate more traffic (the apparent focus of the Chamber’s discussion), more children needing schools, more workers and residents needing parks and recreation, more families and employees seeking library resources, and more pollution requiring better environmental management, among other costly consequences.

So why should the residents of Reston or anywhere else in the county even be in the discussion as a source of funding for an infrastructure requirement in Reston generated by the profit-driven activities of private developers? It doesn’t matter whether that discussion is about additions to property tax rates (which must be the same on all property by state law), new or expanded special tax districts (like Reston Tax District #5) and rates, meals taxes on restaurant goers, added occupancy taxes on local hotel visitors, higher sales taxes, etc.

But here’s the ugly twist: The county government’s financial interests are more aligned with the developers than the residents it was elected to represent. The County, which is seemingly always desperate for new tax revenues, stands to receive large new revenue streams from development as the greater value of the new high-density properties generates more property taxes.

At the same time, the development will also force the County to invest billions of dollars to build the needed supporting public infrastructure. The consequence is that the County doesn’t want to impose costs on developers that might discourage their tax-revenue generating construction although a wide variety of mechanisms are available, including proffers, impact fees, in-kind contributions, tax increment financing, etc. (See chart for a high-level summary.)

So residents, especially property owners, end up becoming the county’s cash cow. In fact, Fairfax County homeowners have already become the primary source of County property tax revenues since the slump in commercial property values seven years ago.

We challenge the Greater Reston Chamber of Commerce, its panelists, and its membership to look closely at itself and not others–not residents, not retailers, not diners, not non-voting visitors, etc.–to contribute what is needed to sustain, if not improve, our Reston community. Private developers who will profit should pay for the public facilities that will be required to make their development and our community succeed.

Reston 20/20 will be looking to see whether there are any signs of that corporate social responsibility to the community coming out of this Thursday’s Chamber seminar. And, in the near future, we will look to the County to offer a free community seminar — or several — on what public infrastructure needs to be built with the coming development and solicit the public’s input on who should pay for it.

The seminar is at Hidden Creek Country Club from 4:00-6:30 p.m., Thursday, Feb. 11. Anyone may attend, but non-members must pay $50 admission and an extra $10 at the door.

MWAA: Silver Line Phase 1 Final Costs Up $76 Million, Phase 2 to Take 13 Months Longer & Add to Costs

April 27, 2015   

Airports Authority Updates Status of Silver Line Metrorail Construction Project 

Design Changes Enhance Safety, Reliability, Environmental Protection

Will Add Time, Cost; Will Not Impact Dulles Toll Road Rates 

The Metropolitan Washington Airports Authority announced Monday that design modifications
made to enhance the safety and reliability of the Metrorail Silver Line, along with remaining
work to finalize Phase 1 of the overall project, will add $76 million, or about 2.6 percent, to the
previously announced Phase 1 cost. The new Phase 1 cost remains within the original federally
approved Phase 1 budget.

Toll rates on the Dulles Toll Road will not be affected. Toll rates will remain at current levels
through 2018, and the previously published, decades-long toll rate schedule will remain
unchanged.  Revenue from tolls is one of several sources of funding for the Silver Line project,
which the Airports Authority is constructing for the Washington Metropolitan Area Transit
Authority (WMATA).

A recently concluded global settlement with the construction contractor for Phase 1, Dulles
Transit Partners, along with the resolution of other outstanding matters – including the close-out
of Virginia permits which allowed Phase 1 work within Routes 7 and 123 in Tysons Corner, and
the execution of contracts to supplement certain Phase 1 work, as required by WMATA – has
allowed the Airports Authority to project a final Phase 1 close-out cost of $2.982 billion, which
represents an additional cost of about $76 million, and to move to the final close-out of the Phase
1 project.  The majority of the remaining work on Phase 1, which opened for business in July
2014, will be completed by the end of this year, including the delivery of 64 new rail cars at a
cost of $189.4 million to expand the Metrorail fleet.  Final close-out of Phase 1 is expected to
occur in 2016.

“The Phase 1 global settlement is an important milestone in the Silver Line project, following its
successful launch in July 2014,” Airports Authority CEO Jack Potter said.  “It gives us closure
on the most substantial cost component of Phase 1, ensures we will achieve the project’s federal
budget targets and allows us to maintain the existing toll schedule for the Dulles Toll Road.”

The ultimate impact of the Phase 1 additional costs may be reduced or even eliminated if the
contingency budget for Phase 2 of the Silver Line project is not fully used and the total project,
both Phases 1 and 2, comes in at or under the overall project budget.

The Airports Authority also announced an update to the construction schedule for Phase 2 of the
Silver Line project, which will extend service from the terminus of Phase 1 in Reston, Virginia,
through Washington Dulles International Airport and into Loudoun County, Virginia.

More than 150 modifications have been made and integrated into the design for Phase 2. Many
of these modifications parallel design changes made in the latter stages of Phase 1 and will
enhance the safety and reliability of Phase 2.  The modifications, when combined with associated
weather and construction delays, have extended the Phase 2 construction schedule by about 13
months.

“Over 100 design changes were made in Phase 1 – a large number of them ordered in the final
months of the construction process – requiring additional design, engineering, construction,
management and oversight work,” said Charles Stark, the Airports Authority’s executive director
of the Silver Line project. “For consistency, many of these same safety and reliability
modifications needed to be incorporated into Phase 2 of the project, which then impacted the
schedule.”

Potter said, “The added costs arising from Phase 2 design modifications will remain within the
Phase 2 contingency budget of $550 million and will have no effect on the toll rates on the
Dulles Toll Road. With our project partners, we are committed to limiting future design changes.
Phase 1 is already experiencing ridership beyond expectations, and significant construction and
development is underway along its path in the Dulles Corridor. We are confident that Phase 2
will experience similar success.” 

Construction of the Silver Line, one of the largest public transportation construction projects
underway in the country, is managed by the Metropolitan Washington Airports Authority, and is
being built in partnership with Loudoun and Fairfax counties and the Commonwealth of
Virginia, with financial assistance from the federal government.  It will be transferred to the
WMATA for operation upon completion. 
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