Supervisors to Levy Five Percent Post-Election Real Estate Tax Increase - Again

Why I Support a Public Facilities Ordinance.

Local Income Tax Could Be Latest Burden On Fairfax County Taxpayers

Hanley Gets Major Real Estate Tax Increase; Reneges on Promise to Not Raise Taxes

County Uses Gilmore Car Tax Reimbursement to Camouflage a Three-Percent Homeowner Tax Increase

For and Against the Virginia Standards of Learning Tests

Baseball Without Bond Indebtedness

FCTA President, Arthur Purves, Arrested

The Anatomy of a Public Hearing

Bond Referendum Facts.

Before you vote for new "transportation" taxes

Odds and Ends

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Page 3

The Fairfax County Taxpayers Alliance Newsletter, Spring 2000

Storm clouds are once again gathering for Fairfax County taxpayers.  HB 692 has now passed and will pave the way for a "piggy-back" local income tax, imposed indefinitely, to fund transportation projects.  This plan to impose a new tax comes at a time when federal, state and local governments are already raking in record amounts in tax revenue, leading to large surpluses. The ominous prospect of a new and unnecessary tax should serve as a wakeup call to taxpayers!

HB 692, advocated by local Delegates Roger McClure, James Scott, and Robert Hull, provides that imposition of a local income tax may be set forth on a referendum ballot in quarter percent increments not to exceed one percent.  This local tax is now earmarked for both transportation and education projects.  HB 692 repeals current law that restricts any such local income tax to a duration of five years; in other words, HB 692 ensures that once the local income tax is on the books, it will be there to stay.

The current Virginia tax rate is 5.75 percent for taxable incomes over $17,000.  With a maximum rate increase of one percent possible, Fairfax County taxpayers could be hit with a whopping 17 percent increase in their state tax bills .

The FCTA is dismayed by this proposed new tax, which is intended to mask the excessive spending of taxpayer dollars by local government over the past 25 years.  As the FCTA has chronicled repeatedly, since 1975 Fairfax County public schools and government have spent $11 billion more than was required to keep up with population and inflation.  Of that amount, $7 billion has been spent since 1990.  More judicious use of taxpayer funds would not have left Fairfax County with the lack of transportation infrastructure that is now cited.  For example, the total estimated cost for a Dulles Airport Metrorail extension, an I-66 Metrorail extension, and a Route 1 Metrorail extension is approximately $5 billion.  These projects, and many others, could have been funded comfortably in the absence of government overspending and waste.

In addition, competing transportation plans proposed by the Senate, the House of Delegates, and Governor Gilmore already commit up to $2.5 billion dollars for transportation projects over the next six years. 

Moreover, taxpayers should not be fooled by the  seemingly small percentage of their income that the proposed tax will take initially.  One has only to look at the history of the fed-

eral income tax to know that once a tax gets on the books, it will inevitably impose an increasing burden upon taxpayers.  When Congress initially imposed the modern federal income tax in 1913, the highest tax rate was 7%, and a large personal exemption meant that the vast majority of people paid no tax at all.  Compare that with today's system, where federal income tax brackets range from 15% to 39.6%, and the IRS collects hundreds of billions of dollars from individuals every year.  Clearly, once a local income tax is approved, with no restrictions on its duration, the cost to taxpayers will only increase.

Fortunately, HB 692 has not yet been signed into law.  While the bill has been approved by both the House of Delegates and the Senate, it must now be signed into law by Governor Gilmore.  Governor Gilmore has announced opposition to the bill, and it remains to be seen whether the tax advocates have the votes to override a veto.

Finally, taxpayers should take heart that they will still have a chance to stop the local income tax, even if HB 692 ultimately becomes law.  The tax can only be imposed if it is approved by voters in a referendum, and a referendum may be held as early as November 2000.  The FCTA anticipates that a proposed local income tax could engender among voters a negative reaction not seen since the meals tax advocated by the Board of Supervisors, and defeated by the voters in April 1992.  The FCTA will take a leading role in publicizing this oppressive and unnecessary new tax, and in working to defeat it.  There will be well-funded special interests seeking approval of the tax however, so we will need your help.  Let your representatives and Governor Gilmore know now that you oppose a new local income tax, and be prepared to vote against it in November 2000.   

Write, Phone, Fax, or E-mail Governor Gilmore:

The Honorable James S. Gilmore, III
Office of the Governor
State Capitol, 3rd Floor
Richmond, Virginia 23219
(804) 786-2211 or Fax (804) 371-6351
E-mail Form at:  www.state.va.us/governor/govmail.htm

For Information Concerning Your State Delegate and Senator, Use The Citizen's Guide--Who's My Legislator?

Web Address:  http://206.246.254.9/whosmy/

This newsletter predicted a post-election tax hike a year ago.  The supervisors' strategy is to raise taxes immediately after their election and hope that the voters will forget about it during the four years before the next election. When campaigning for election the supervisors avoid discussing taxes.  If confronted by a reporter, however, they deny any plan to raise taxes.  So, for example, Fairfax County Board of Supervisors Chairman Katherine K. Hanley, when asked, told the Connection newspapers, ". . . I do not foresee a real-estate tax increase next year."  This strategy kept taxes from becoming an election issue.  Because tax increases were not an election issue, the press feels no obligation to hold supervisors accountable for going back on their word.

In his Advertised FY2001 budget, the new county executive, Anthony H. Griffin, recommended raising the average household real estate tax by $123, from $2407 to $2531.  This increase is 550 percent larger than the average real estate tax increase for the past three years and almost matches the $142 increase the supervisors imposed after the last supervisors' election.

While the last increase was the result of a tax rate hike, this increase is due to a five-percent surge in residential real estate assessments.  Since 1992 average residential real estate assessments had not increased.  To raise taxes during this period the supervisors increased the real estate tax rate, by five cents in 1993 and seven cents in 1997, to the current rate of $1.23 per $100 of the assessed property value. 
This year the higher assessments permit the county to 

While most newspapers have reported the tax hike, they have not reported that it is over five times larger than the average tax increase for the preceding three years.  This suits the supervisors, who hope that the voters will not notice the tax hike, since assessment increases attract less attention than tax rate increases.  The supervisors would also like the voters to think that since the tax rate is the same, taxes really did not increase.  This might explain Chairman Hanley's December 20, 1999, statement that the Board would not raise taxes this spring.

However, a $123 tax increase arising from higher assessments costs the taxpayer just as much as a $123 increase arising from a hike in the tax rate.  What the Board should do is reduce the tax rate six cents to compensate for the rise in assessments.  Such a reduction would reduce budget revenue by $54 million, which is only 2.5% of the county's $2.1 billion budget.

However, the schools, who are far more effective at increasing spending than increasing test scores, have pre-empted any budget cuts by asking for $75 million more than the County is providing.  The schools are asking for $42.3 million to cover the cost of an enrollment increase of 4,042 students.  That is a cost of $10,465 per student.  The per-student cost of currently enrolled students is $8,203.  The schools also state that 31 percent of new students will require separate special education classes.  Currently only seven percent of all students are in separate special education classes.  The schools offer no explanation for the explosive growth of special education enrollment.

Very little of the county budget increase will be spent on 

the county's most pressing problem - transportation.  The county regards transportation as the state's problem.

The supervisors' strategy of raising taxes after the election and pretending that tax increases due to rising 
assessments really are not tax increases has taken its toll on the taxpayers over the years.

Since 1975, the county taxes (real estate, personal property, utility, and sales) for the average Fairfax County household have increased by $600 or 22 percent, adjusted for inflation.

In addition commercial tax rates have increased 53 percent, adjusted for inflation.  Commercial square footage (commercial taxes are charged per square foot) has increased 180 percent.
 

The result is that Fairfax County's school and government budgets have grown much faster than population and inflation.  The school staff has grown four times faster than enrollment.  The county staff has grown much faster  than population. 

When business tax revenues grew, the supervisors could have reduced residential taxes.  If they had done this, and if county and school spending had grown no faster than population and inflation since 1975, total annual county taxes for the average household would be about $2000 less than they are now.

                                                 by Arthur G. Purves

The Fairfax County government is using Governor Gilmore's "car tax" payment from the state to camouflage a tax increase.  The county budget is no longer reporting the portion of the personal property tax that is paid from the state. Taxpayers are still paying the entire personal property tax, partially through the county and partially from state coffers.  However the county budget makes it appear that the personal property tax paid by the average household has decreased.   In fact it has increased.

When the full personal property tax is included, the average real estate, personal property, sales, and utility taxes paid by a household increases from $3645 in FY00 to $3755 in FY01, an increase of three percent, adjusted for inflation.  This brings average household taxes to a record high.

The tax increase that followed the last supervisors' election, in 1997, was 4.6 percent.  That increase was fueled by a hike in the real estate tax rate.  This year's increase is fueled by an unexpected five-percent surge in homeowner assessments plus growth in sales taxes.

When I opposed Chairman Katherine K. Hanley in the last supervisors' election, I predicted that Chairman Hanley would vote for a tax increase if re-elected.  Based on the friendly reception the supervisors gave the FY2001 budget, it appears that she will vote for a three percent real increase in household taxes.

Local government has actually succeeded in having Gilmore's "no car tax" campaign backfire.  As the personal property tax is shifted to the state, local governments will let other tax rates accelerate to replace it.  The result is that taxpayers will still pay escalating personal property taxes through the state and even more rapidly escalating local taxes.
 

By Arthur G. Purves
 
 

FOR:  Mychele Brickner  - Member of the Fairfax County School Board
 

What excuse will suffice for children who are in 10th grade but read at the 6^th grade level, for students who cannot handle algebra I because they cannot multiply and divide?  What excuse will you accept for children who get their high school diploma but cannot take college level English or math courses?

Is it OK to blame this on too many non-English speaking students, too many from poverty, too high a mobility rate?  But what about those from English speaking middle class homes that lived in Fairfax County all their lives?  What excuse for them?

There should be no excuses.  All children can learn.

Last week I attended a conference with educators from across America who are achieving academic excellence in high poverty schools.  They refuse to make excuses for failure.  They use proven curriculum like explicit phonics-based reading and Saxon math and get results far superior to our schools with high levels of poverty.  The difference is they expect success from teachers and students.  They constantly assess to make sure kids are getting it and they make sure teachers can teach.  They are not afraid of tests.

I am sorry that many here are willing to make excuses and fight against the accountability this program provides.  The highly rated Virginia Standards of Learning are meaningless without some way of measuring what the students have learned.

I strongly support the SOLs, as well as the accountability system.  I know that I speak for many parents who share my thoughts on this subject. 

There is some fine-tuning that needs to be addressed and I thank you for doing that, but I hope you will stand firm on accountability.

Since the SOL testing was implemented I see positive changes. Fairfax County is now remediating students who in the past were promoted to the next grade level without the necessary skills to succeed.  This long-standing problem would not have been addressed without the pressure and direction from the SOLs. 
 
 

AGAINST:  Stuart Gibson, speaking on behalf of the Fairfax County School Board (excerpts)

The core problem with Virginia's accountability system remains:  The lack of one point on one test after 13 years of schooling will deny a student a diploma.  The lack of one point on one test taken by a small percentage of a school's student body will deny the entire school its accreditation.  Is a single assessment instrument the way we Virginians want to measure our children and our public schools?

The Fairfax County School Board does not support relying on one measure to determine high stakes outcomes as critical as high school graduation and school accreditation.  This is inconsistent with standards in the business world and best practices in the education world.  We must use multiple evaluation tools to properly assess educational achievement.  We urge the state Board to expand its program beyond absolute, committee-set, student passing rates on the standardized SOL tests.

The Fairfax County School Board recommends several specific changes to the proposed revisions.  Some are listed below. 
 

• Develop a general diploma for those students who meet all course requirements, but do not earn enough verified units of credit.  Such a diploma is appropriate for those students who want to develop specific career proficiencies or, who, because of their disabilities, are unable to pass the required number of SOL examinations.

• Promptly enact procedures and guidelines for developing individual school accreditation plans for alternative and special purpose schools.  These individually designed programs for small, challenging, and often transient student populations should be accredited on standards specifically related to their purposes.  As a model, we suggest the alternative school accreditation plan used by the Southern Association.

In closing, the Fairfax County School Board genuinely supports high standards, valid assessments, and sensible accountability.  But we are justifiably apprehensive about the costs and consequences of the ever-expanding accountability program. 

Thank you for your attention.

Economists talk about the "benefit principle of taxation", the idea that benefits provided by government should be paid for by those that receive the benefits.  Using state or local taxes to subsidize private business activities violates this principle by shifting the burden to taxpayers that receive little or no benefit in return.  Interestingly enough, the issue of tax-exempt bonds, one stadium financing option being pursued by the Virginia Baseball Stadium Authority, would amount to a federal subsidy to the investors purchasing the bonds.  These investors would not be required to pay taxes on the in terest return from those bonds. It is likely that 

This is a call to Virginia legislators to resist the efforts of lobbyists to hijack the process of determining what is in the best interest of the citizens of the state of Virginia.  The idea that luxury sports stadiums deserve the same status as critical public works facilities, when it comes to deciding how to finance them through the sale of bonds, should be soundly defeated.

Page 8

The Fairfax County Taxpayers Alliance Newsletter, Spring 2000

On Thursday, February 10, 2000, Arthur G. Purves spoke on behalf of the Fairfax County Taxpayers Alliance before the Fairfax County School Board.  Mr. Purves was one of six speakers.  The subject was the school budget, on which the school board was going to take its final vote that night.  Of the six speakers, Mr. Purves was the only one who was not a school system employee.

The other speakers were:

Rick Baumgartner, President Elect of the Fairfax County Education Association.  Mr. Baumgartner told the school board  to not balance its budget by reducing government contributions to the teacher retirement fund.

Glen Bayless, of the Fairfax County Federation of Teachers.  Mr. Bayless requested more funding to attract retired teachers as substitutes.

John Butterfield, President of the Fairfax Education Association.  Mr. Butterfield described how his teachers' union was going to lobby for full funding of the school budget.  His plans included collecting petitions, briefings with supervisors and business leaders, meeting with delegates to the Virginia General Assembly, sending 25,000 e-mails to registered voters in Fairfax County, meeting with the media, and having a large turnout of teachers at the supervisors' April 3 budget hearing.  Of his critics, Mr. Butterfield said, "We wish petty splinter groups of fear mongers would cease their detrimental policy of untrue rhetoric aimed only at their own narrow philosophy."

Judy Baird, Chairman of the Support Services Employees Advisory Council.  Ms. Baird voiced support for a five-percent cost-of-living adjustment.

Steven Eddy, who spoke on behalf of the Fairfax County School Board Employee Association.  Mr. Eddy also supported the five-percent cost-of-living adjustment and urged an increase to the Instructional Assistant salary scale.  He noted that he went with leaders from another major employee organization and an employee advisory council to meet with members of the General Assembly to lobby for state funding.  He also plans to meet with Chairman Hanley and Supervisor Connolly.

Mr. Purves stated that since 1975 the schools have spent $9 billion more than was required to keep up with enrollment and inflation and of that, $6 billion had been spent since 1990.  This would have been enough money to build the Dulles Airport and I-66 Metrorail extensions and build a new Woodrow Wilson Bridge.  He then listed school programs that could be cut or reduced if schools returned to a more traditional curriculum: high school academies, Success by Eight, Excel Schools, GT resource teachers, Special Needs schools, Head Start, Title I, Learning Disabilities, the seven-period day, computers, guidance counseling, social workers, psychologists, reading resource teachers, assistant principals, elaborate teacher evaluations, and clerical staff.

At the meeting, the School Board voted unanimously, both Republicans and Democrats, for a budget that required $85 million more than the County had said it could provide without a tax increase.

What transpired at this meeting is not unusual.  Most of the speakers at public hearings are people who are receiving money or benefits from the government.  Taxpayers rarely show up.  Government employees take the time to lobby government officials in person because salaries are on the line.

Speaking at hearings and personal lobbying can have an impact.  If it bothers you that the school superintendent did not announce his budget increase before the election, or that Chairman Hanley says she is not raising taxes when she is, or that government spending is growing faster than population and inflation, sign up to speak!  The Board of Supervisors is having its budget hearings on April 3, 4, and 5.  Anyone can speak.  No speakers are turned away.  They'll add additional nights of hearings if more speakers than expected sign up.  Speakers are allowed three minutes and are asked to bring about 20 copies of their remarks.  To sign up to speak, telephone the clerk of the board at 703-324-3151.
 

By Arthur G. Purves

Page 10

The Fairfax County Taxpayers Alliance Newsletter, Spring 2000

The following web link will take you to the county's tax relief page for the elderly:  http://166.94.9.135/dta/tr_re_faq.htm

The following announcement, about public comment times being established, was found on the Fairfax County web site.  The Fairfax County Board of Supervisors has set up several "public comments times" throughout the year.  Residents are invited to comment on any issue except items under litigation, topics scheduled for public hearings or individuals.  The comments times are scheduled for Feb. 28, April 24, June 26, Aug. 7, Oct. 30 and Dec. 11 at 
5:30 p.m. in the auditorium at 1200 Government Center Pkwy.  To register to speak, call the Office of the Clerk to the Board at 703-324-3151 (voice) or 703-324-3903 (TTY).  No more than 10 speakers will appear during each session.  A speaker may address the board once in a six-month period.  The scheduled time for the comments period will be determined on a meeting-by-meeting basis.

The Libertarian Party issued a media release that nicely summed up President Clinton's State of the Union speech.  Here are some of the Libertarian Party's calculations. 
*Length of speech: 89 minutes
*Total proposed new/increased federal spending: $743 billion ($400 billion for Medicare, $343 billion for   other programs). 
*Proposed new spending per HOUR of speech: $495.3 billion
*Proposed new spending per MINUTE of speech: $8.3 billion 
*Proposed new spending per SECOND of speech: $139 million.
*Total proposed new/expanded federal programs: 101

The FCTA recently received an e-mail from a business owner stating his concern that the Board of Supervisors had approved a 50-year lease for nine acres in Reston, at cost of $1 per year, to the YMCA.  The YMCA is building a $10 million, 55,000 square foot facility that will include a fitness center.  This business owner now finds himself, along with the other fitness center owners in the county, having to compete with a business that pays just $1 a year for rent and no taxes because of its "non-profit" status.  The business owner states that approximately 90 percent of YMCA revenues come from earned income as opposed to donations,  while only about one percent of, for instance, Catholic Charities' revenue is from earned income.  Is this fair to the business owners or the county taxpayers who do pay taxes?

We have heard the term "campaign finance reform" quite a lot lately.  Like so much of what we hear from politicians, the campaign finance reform mantra sounds great until you look at the details.  I read where George Will described campaign finance reform as a "steadily thickening clot of laws and an enforcing bureaucracy to control both the quantity and the content of all the discourse pertinent to politics."  In English, our rights of free speech would be compromised.  And the FCTA, for example, would  for 60 days before an election not be permitted to publish such information as the voting records of the incumbent members of the Board of Supervisors.   This "reform" would leave the media, primarily print and television, as the major purveyors of election news for the 60 days before the election.  Rowan Scarborough, of The Washington Times, states "The three major TV networks have given scant coverage to major stories on Vice President Al Gore's fund-raising lapses, prompting conservatives to charge the prime-time shows favor the Democratic presidential candidate."  Tim Graham, director of media analysis at the Media Research Center said, "I think it's just simply the media wants campaign finance reform and they know they're not going to get it with [Texas Gov. George W.] Bush because it gives the media added power over the political message in America."

Since oil prices shift with supply and demand, and now that OPEC has reduced production, we are witnessing a steady upward trend for oil prices.  The antidote to higher prices is more production but it won't be coming from Alaska. The Washington Times wrote an editorial, Mar. 17, 2000, entitled Wildlife and oil prices.   In 1995, the Clinton administration vetoed legislation that would have allowed oil exploration and development on a tiny section of the Alaska National Wildlife Refuge.  Today, says Alaska Sen. Frank Murkowshki ,"the entire development may only disrupt 2,000 acres of the [refuge's] coastal plain."  This refers to 2,000 acres out of the 58,000,000 million acres designated as federal wilderness.  
Tom Pfister