Official Board of Supervisors Agenda Item for Reston TSD Road Tax Hearing, 4:30PM, February 28, 2017, Government Center

Below is the official Board of Supervisors agenda text for the upcoming Board hearing on the proposed Reston Transportation Service District (TSD) road tax.  A couple of early observations:

• There is no "sunset" clause provision terminating the tax after 40 years as stated in Supervisor Hudgins' February newsletter.  
• The item "assumes" the initial $.021/$100 valuation will remain unchanged throughout the 40-year period.  

Here's the full text:

 4:30 p.m. Public hearing concerning consideration of a request to endorse a funding plan for transportation improvements related to the Reston Phase I Comprehensive Plan Amendment (Reston Transportation Funding Plan). The proposed Reston Transportation Funding Plan addresses the $2.27 billion (in 2016 dollars) need for transportation infrastructure improvements to support the land use recommendations in the Reston Phase I Comprehensive Plan Amendment. The proposed plan allocates roughly $1.2 billion of the improvements over 40 years from public funds–Federal, State, local, and regional funds that are anticipated for countywide transportation projects. It also recommends that approximately $1.07 billion of the cost for these improvements be raised from private fund– sources of revenue that are generated within the Reston Transit Station Areas (TSAs): Wiehle-Reston East, Reston Town Center, and Herndon Transit Station Area and used exclusively for transportation improvements in the Reston TSAs. These private revenues would include developer contributions through actual construction, a transportation road fund that would collect contributions from new developments in the Reston TSAs, and a transportation service tax district that would allow the Board to levy and collect an annual tax from all property owners in the Reston TSAs. The proposed Reston Transportation Funding Plan includes initial rates for the Road Fund and Service District. These proposed initial rates, however, are subject to Board approval. Specifically, the Board will take a separate action to approve the Road Fund Guidelines and, following a separate public hearing, create the Service District. The initial rates included in the proposed Transportation Funding Plan are as follows:  Road Fund:  Residential per Dwelling Unit Rate: $2,090 Commercial per Square Foot Rate: $9.56.  It is anticipated that these rates would be adjusted annually, based on inflation.  Service District: Rate per $100 of Assessed Value: $0.021.  The proposed funding plan assumes this rate would remain flat during the life of the service district; however, the actual rate would be adopted annually by the Board of Supervisors. Property outside the Reston TSAs would be unaffected by the service district. More information about the development of the Reston Transportation Funding Plan can be found here:  http://www.fairfaxcounty.gov/fcdot/restonnetworkanalysis/ Questions regarding this proposed amendment may be directed to the Fairfax County Department of Transportation at 703-877-5600.

 We have discussed the absurdity of a TSD tax on Reston station area homeowners as well as the underlying fraud behind this financing proposal.  If you agree with us that this tax proposal is unwarranted and unfair, please do one or all of the following:

• Contact Supervisor Hudgins and tell her your concerns (Catherine.Hudgins@fairfaxcounty.gov)
• Sign our petition to stop this tax.  
• Attend and testify at the upcoming hearing.  

STOP THE RESTON ROAD TAX NOW!

   Stop the Reston Road Tax --Final--rev by TerryMaynard on Scribd

Reston says "HELL NO!" to transportation tax district.

   Reston Association Member Survey on Proposed Tax Service District

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

Op-Ed: Reston Transportation Tax Proposal is Grotesque County Corporate Welfare, RestonNow, April 18, 2016

The following is a re-post from RestonNow.

Op-Ed: Reston Transportation Tax Proposal is Grotesque County Corporate Welfare

This is an op-ed by Reston resident Terry Maynard. It does not reflect the opinion of Reston Now. Something on your mind? Send a letter to news@restonnow.com.

Restonians are once again faced with the prospect of the burden of an added local “tax service district  that could add hundreds of dollars to their annual property tax bill every year. The one we already have, Small Tax District 5, supports our Reston Community Center in providing cultural and educational activities for the community. The proposed new one would solely subsidize developer profits while increasing county tax revenues.

As this discussion continues, Reston Association has shared a questionnaire online with its weekly RA NewsLine (click on “Transportation Tax Survey) for residents to provide feedback on the Reston special transportation tax district idea. I urge all Restonians to vote “NO.” The following provides an explanation why.

The basis for the proposal lies in planned development in Reston’s station areas, growth that will exclusively benefit Reston’s station area landowners. Assuming that all Reston developers are as successful as Boston Properties per its 2015 annual report, their likely profit will total more than $53 billion over 40 years after building costs. That includes more than $9 billion from their future development as well as more than one billion dollars per year from their existing Reston holdings. That is an average of $1.3 billion per year!

Yet these same developers, backed by the County, want Reston homeowners to pick up as much as half of the $2.6 billion tab — about $65 million per year — for needed station area road improvement even though their total cost will be less than three percent of their profit from their Reston properties over the next 40 years.

The forecast annual road improvement cost is less than five percent of the future annual profits of the Reston station area landowners and can be easily absorbed as part of their investment in offsetting the impact of their development, but the County is proposing that residents pay some of the road costs.

One of the transportation tax options the County has proposed is that all Reston homeowners pay $.025/$100 residential property valuation to help defray the road improvement costs. Today, with the average Reston home valued at $428,000, the added cost of that Reston special tax would be $107 per year to start.  This special tax would be in addition to the average $202 Restonians already pay to operate the Reston Community Center, a County public facility committed primarily to Restonians’ use.

With 3 percent annual appreciation in the value of a family home and/or general inflation, the average added transportation tax cost would be more than $200 per year per household over the next 40 years for an average-priced home — assuming the mix of home values remains constant (and it is more likely to increase with thousands of new high-priced condos in the station areas). On a community-wide basis, that three percent annual growth in assessments would mean the average Reston homeowner would pay more than $8,800 and the total residential community tax contribution would be more than $350 million over 40 years. And that is without any shift in housing mix or tax rate increases by the Board of Supervisors.

The Board is driving the transportation tax idea because it believes that by encouraging the growth of taxable real estate values, it can solve its budget problem. Another Reston special tax district at $.025/$100 valuation Reston-wide tax rate would bring in about $4.4 million in new revenues in the first year — and grow every year thereafter — even if there is no development. Moreover, from the Board’s perspective, to the extent these taxes encourage developers to build sooner because of lower investment costs, it will create even more high-tax value high-density real estate. It’s a win-win situation from a Board perspective: More tax revenue through subsidized corporate development.

And all of that special Reston tax money would go to Reston’s station area landowners in defraying the road infrastructure costs of their for-profit development. Specifically, the taxes would be used to improve roads that go to, from, within, and through the station areas to serve developer properties that would be required for their profitable high-density development.  Yet–

• If the developers believe they will earn an adequate return on their investment, they will build the roads needed to help make their new construction profitable anyway without a special Reston residential tax subsidy.
• If they choose not to build for whatever reason, then Reston won’t need improved roadways (except to meet existing standards) and, therefore, we won’t need any added transportation taxes.

If the transportation tax is approved, Restonians would have no special access or other benefit to anything in the station areas despite paying a significant sum for these new or improve roads, even free parking. People from all over the county, the state, even beyond Virginia, including most of the 60,000-plus Reston station area employees who commute here daily, will use the station area roads for free while Restonians pay for them. Even those Restonians who choose not to go to the station areas (or go there rarely) such as retirees on fixed incomes and younger, less affluent Restonians will still have to pay the full transportation tax.

The ultimate irony of this road “improvement” tax proposal is that the County literally promises worse congestion as a desirable traffic “goal.”   So Restonians will be taxed to experience worse congestion, even those who only drive through the station areas, say, on Wiehle to/from the Dulles Toll Road, with no intention of visiting them.

The bottom line is that the transportation tax proposal completely detaches who pays the tax from who benefits from it. Residents pay more for less usable roadways; developers pay less and profit more. It is unfair and inequitable to Restonians by any measure.

The idea that taxing Reston homeowners, whether they live in the station areas or beyond, because they will garner some unidentified, much less quantifiable, “benefit” from the development there is a deceptive scheme and the County knows it.   The proposed County transportation tax is, in fact, nothing more than grotesque corporate welfare, the Reston property owner paying more taxes so major Reston developers can increase their profits and the County can increase its tax revenues.

The transportation tax idea should be opposed vigorously by the Reston community, the RA Board of Directors and other community leaders and organizations, the County-appointed RNAG advisory group examining Reston’s transportation options, and ultimately the Board of Supervisors itself. Do what you can now:

• Vote “NO” to the transportation tax in RA’s online survey
• Attend Supervisor Hudgins’ “Reston . . . Blueprint for the Future” Open House this Wednesday, April 20, 6-8:30 p.m., South Lakes High School, and tell county officials and developers what you think.
• Let Reston’s leaders know of your disapproval of this dishonest and unfair proposal.

Terry Maynard
Reston

So you think your property taxes are high? Take a look at this . . .

New local income tax for Northern Virginia?

Senate Bill #1313  has made it to the House of Delegates with an amendment, supported by our Sen. Howell, that would allow Northern Virginia county supervisors to impose up to a one percent income tax on top of the state income tax "for each taxable year of every resident of such county or city or corporation having income from sources within such county or city."  At present, Virginians are protected from such local government overreach by a requirement that any such tax increases be approved by referendum.  None have ever been presented to the electorate in a referendum. 

Here is the bill as it is currently proposed:

SENATE BILL NO. 1313 Offered January 17, 2013 A BILL to amend and reenact § 58.1-540 of the Code of Virginia and to repeal § 58.1-549 of the Code of Virginia, relating to local income tax.
---------- Patron-- Stosch ---------- Referred to Committee on Finance ---------- Be it enacted by the General Assembly of Virginia:
1.  That § 58.1-540 of the Code of Virginia is amended and reenacted as follows:
§ 58.1-540. Levy of the tax.
A. The Counties of Arlington, Fairfax, Loudoun, and Prince William, and the Cities of Alexandria, Fairfax, Falls Church, Manassas, Manassas Park, Norfolk, Portsmouth, and Virginia Beach hereby authorized to levy a local income tax at any increment of one-quarter percent up to a maximum rate of one percent upon the Virginia taxable income as determined in § 58.1-322 for an individual, § 58.1-361 for a fiduciary of an estate or trust, or § 58.1-402 for a corporation, for each taxable year of every resident of such county or city or corporation having income from sources within such county or city, subject to the limitations of subsection B of this section. The same rate shall apply to individuals, fiduciaries and corporations.
B. The authority to levy a local income tax as provided in subsection A may be exercised by a county or city governing body only if approved in a referendum within the county or city. The referendum shall be held in accordance with § 24.2-684. The referendum may be initiated either by a resolution of the governing body of the county or city or on the filing of a petition signed by a number of registered voters of the county or city equal in number to ten percent of the number of voters registered in the county or city on January 1 of the year in which the petition is filed with the circuit court of such county or city. The clerk of the circuit court shall publish notice of the election in a newspaper of general circulation in the county or city once a week for three consecutive weeks prior to the election. The ballot used shall be printed to read as follows:
"Shall the governing body of (.... name of county or city ....) have the authority to levy a local income tax of up to one percent for transportation purposes in accordance with § 58.1-540 of the Code of Virginia?
[]Yes
[]No"
If the voters by a majority vote approve the authority of the local governing body to levy a local income tax, the The tax may be imposed by the adoption of an ordinance by the governing body of the county or city in accordance with general or special law, and the tax may be thereafter enacted, modified or repealed as any other tax the governing body is empowered to levy subject only to the limitations herein. No, except that no ordinance levying a local income tax shall be repealed unless and until all debts or other obligations of the county or city to which such revenues are pledged or otherwise committed have been paid or provision made for payment.
2. That § 58.1-549 of the Code of Virginia is repealed.

 An article by Scott McCaffrey in yesterday's Arlington Sun-Gazette tracks reaction to the bill.  It begins:

Is it a back-door attempt at a tax increase, or the best way to help fund transportation improvements across the region?

That could be the question if the House of Delegates goes along with a state Senate proposal giving Northern Virginia localities the ability to impose a local income tax without first going to voters for permission.

The measure, tucked into an unrelated tax measure patroned by state Sen. Walter Stosch (R-Virginia Beach), passed the state Senate 27-11 on the last day before “crossover,” when bills in each house have to be sent to the other house.

Stosch’s measure ostensibly is designed to add the city of Norfolk to the list of localities across Virginia allowed to impose a local income tax (up to 1 percent) to generate revenue for transportation purposes. But the bill also removes the requirement that Northern Virginia localities hold referendums before the tax can be imposed. . . .

 Click here to read the rest of the Sun-Gazette article. 

Local Group Concerned About Traffic Impacts of Dulles Metrorail Project, Herndon Patch, April 4, 2012

Reston 2020 Committee says traffic on secondary Herndon and Reston roads could increase by 30,000 vehicles in 2014 due to rising Dulles Toll Road rates.

• By Leslie Perales

The Reston 2020 Committee recently expressed concern about Dulles Toll Road rates sending increasing traffic onto local streets because of the costs of the Dulles Metrorail Project, according to the Washington Post.

The Reston 2020 Committee is predicting that traffic on weekdays on Route 7 and other secondary roads in Herndon and Reston may increase by 30,000 vehicles in 2014, which is slated to be the first full year of the Dulles Rail’s operation. . . .

Click here for the rest of this Herndon Patch piece.