Property Tax Windfall
The booming real estate market and skyrocketing home assessments in the Washington area have created a fountain of tax revenue for local governments in Northern Virginia, many of which are spending the money as fast as it pours in.
In budget proposals unveiled in the past few weeks, local leaders are continuing to push big increases in spending. Loudoun County’s budget has nearly doubled in four years. In Fairfax County, real estate taxes for the average homeowner could go up by 11 percent. Under a Prince William County proposal, taxes would rise an average of 9.4 percent. And these increases follow several years of steep rises in taxes.
With no local income tax available as a source of revenue and with a state government straining to balance its books, suburban counties have welcomed cash from real estate. It has paid for badly needed new schools and roads and has helped communities accommodate services for newcomers. But rapidly rising tax bills are slamming many families, leading to some backlash against local leaders and raising questions about what will happen if real estate fizzles.
Indeed. The assessed value of my townhouse in Loudoun County is $35,000 more than it was last year–and still $50,000 under the market value. The community I’m in didn’t exist five years ago; most of this area was farmland. The people who predate the tech boom (AOL and MCI are five miles down the road) are less than pleased, as their property tax likely exceeds their mortgage payment now.
Having moved here from Alabama, which not only has relatively low home prices–the assessed value of the tiny plot of land my townhouse sits on is more than 2/3 of that for which I sold my house there–but easily the lowest property tax rates in the country, I can certainly see the difference.
My chief complaint is not so much that they manage to spend the money faster than they can take it in, even with this windfall but that they appear to be spending it unwisely. The roads here are absolutely appalling. I’ve never seen so many potholes in my life, which is especially problematic since I seem to be the only one around here with a car that’s under $30,000.