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Fairfax County Advertised FY 2022 Budget Plan: MCA calls for 2c Reduction in Property Tax Rate

Martin F Smith and Bruce Jones  | Published on 5/3/2021
At its meeting of April 7, 2021, the Board of Directors of the McLean Citizens Association approved a Resolution proposed by its Budget and Taxation Committee making recommendations for the FY 2022 Budget Plan. In addition to calling for a 2c reduction (to $1.13 per $100 of assessed value) in the current property tax rate, MCA made recommendations on the FCPS budget and called for an independent "zero-based" review of County programs.

The draft resolution made the following points, among others:

In view of uncertainty about the County’s economic recovery, the advertised County budget for the upcoming Fiscal Year (FY) 2022 conservatively provides for revenue and expenditure levels, at $4.5 billion, that are 0.9% greater than the FY 2021 Adopted Budget;
About 53% of the budget would be transferred to FCPS, including FCPS-related debt service, with 47% reserved for Fairfax County services, infrastructure, and debt service;
Residential property assessments applicable for FY 2022 have increased by 4.25% on average;
The County Executive had recommended that the real estate tax rate be reduced from the current $1.15 per $100 of assessed value to $1.14 per $100 assessed value;
The Advertised Budget proposed no salary increases for County employees for FY 2022, while recommending a net increase of 109 positions;
The Advertised Budget does not reflect funding from the American Rescue Plan, which was enacted on March 11;
It has subsequently been learned that $223 million will be made available to Fairfax County from the American Rescue Plan.
The Fairfax County Public Schools FY 2022 Advertised Budget seeks $90 million more from the County than what the County has allocated;
The FCPS Advertised Budget includes 3% raises for all FCPS employees;
According to actuarial valuations, FCPS will need, in the future, to contribute more to pensions, even in the absence of salary increases;
FCPS can expect to receive $180 million (apart from the allocation to Fairfax County) from the American Rescue Plan.

The draft resolution commends the Board of Supervisors (BoS) for skillful management during recent pandemic and economic challenges.  It makes the following specific recommendations:

Reduction of the real estate tax rate from the current $1.15 per $100 of assessed value to $1.13 per $100 of assessed value for FY 2022;
Hiring of an independent consulting firm to undertake a zero-based analysis of the County’s activities, organizational structure, and staffing;
Subtraction of $180 million from the FCPS requested transfer from the County in its Advertised Budget, given that FCPS will be receiving $180 million of additional funding under the American Rescue Plan (thereby enabling the FCPS Advertised Budget level to be fully funded);
Replacement of 3% salary increases for FCPS with one-time bonuses for school-based FCPS earning no more than $125,000, and for non-school based employees of the FCPS Department of Information Technology.

Several Board members, taking into consideration the efforts of teachers in teaching under pandemic circumstances, expressed concern over the juxtaposition of the recommendation to reduce the property tax rate by two cents, and the recommendation to provide bonuses instead of 3% salary increases to FCPS employees.  Another Board member pointed out, however, that while the incomes of some property owners have held up during the pandemic, other property owners have experienced reduced incomes as a result of the pandemic.  This Board member viewed the recommended tax rate reduction, having the effect of lessening the increase (due to higher assessments) in property tax bills, as justifiable and appropriate.

After discussion had concluded, the resolution was approved, with 25 Yes votes, 10 Nay votes, and two abstentions.

The approved Resolution is here.

A video of the MCA Board of Directors April Meeting is here. Discussion of the budget resolution starts at 27 minutes into the recorded meeting. 

McLean Citizens Association -- McLean, Virginia