Presentation to the Fairfax County Board of Supervisors FY2021 Budget Hearing - 04/28/2020
-- by Bill Peabody, Fairfax County Taxpayers Alliance (fcta.org).
Mr. Chairman and Members of the Board:
My name is Bill Peabody. I address you as a board member of the Fairfax County Taxpayers Alliance.
In the 1990's Fairfax County raised taxes in line with inflation. People stayed. Beginning in the early 2000's, the county began raising taxes at a multiple compared to the rate of inflation. People of means began leaving. This is shown by IRS Adjusted gross income data. In 2019, we lost approximately a half billion dollars to other counties and states. This AGI drain is compounding at about 7% a year, so it may double within 10 years. Over $11 billion has been lost since 2003.
How to fix the budget in the long term:
Keep raises in line with the private sector. 2020 will prove that employees have no alternatives, and even when the economy is booming there's was no great exodus of county employees fleeing to the private sector.
Raise the retirement age to 62 from 55. Since 2015, the average retirement age for private sector workers is 65. The Corona crash may increase the age by a couple of years. Age 40 should be a threshold for the age adjustment. Limiting age adjustment to new hires is inadequate.
DOD prime contractors converted employees to 401k's, and Inova has changed. Keep in mind, United Technologies recently lowered salaries by 10% and many companies have quit matching 401k contributions. Social Security made changes to the retirement age in the 80s. Younger workers don't expect nor want a pension. They want a portable 401k. Why should taxpayers be totally liable for anyone's pension when theirs is at risk?
Don't look to the housing market for bail next year. Any indicator I can find shows lower prices. Taxpayers are acutely aware of the value of their homes. Raising taxes in a down market is improbable.
Thank you.