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Bad News from Richmond

Arlington looks at effects of state budget crisis.

Sometimes Northern Virginia feels like a state independent of the rest of Virginia, and Arlington, once part of the District, shares many concerns with its urban neighbor to the east.

But when Virginia dollars disappear, it is a less-than-welcome reminder of the important relationship between Arlington and Richmond.

Facing an additional $1.5 billion shortfall for the upcoming fiscal year, Governor Mark Warner (D) said the state would be forced to make cuts of up to 15 percent from almost all state agencies. Now Arlington County officials and staff must work to determine how the cuts will affect life in Arlington.

At Saturday’s County Board meeting, County Manager Ron Carlee said that those budget cuts are "much worse" than he had expected, and would also mean lost revenue for the county.

They will also mean lost jobs in Arlington, and increased frustration at branches of the Department of Motor Vehicles and in some programs run by the Virginia Extension office.

At their Oct. 26 meeting, the County Board discussion focused largely on one loss of local funds to meet dire state needs. Certain taxes enacted by local governments throughout Virginia raise revenue specifically to be used locally.

The Virginia state tax department collects many of these taxes, then reimburses local governments for their tax revenues. Now, Carlee said, Governor Warner has ordered cuts in paybacks of local taxes.

Arlington’s local tax on car rentals, which generates about $5 million annually for Arlington, is one source of revenue that will be seriously affected by Warner’s decision. Carlee expects the county to lose $750,000 of revenue from the car rental tax next year. He called the loss "stunning," and said, "If nothing else, it illustrates how desperate the state is."

Board members Paul Ferguson and Barbara Favola shared his outrage. Ferguson asked that the Board consider eliminating or modifying the tax if the local revenue will be taken by the state. Favola noted that other counties face similar loss of local tax money, and said Arlington should communicate with leaders of other counties to determine the best course of action. "We’re not the only ones that are suffering from this robbery from the state," she said.

<b>UNCERTAIN FUTURES TROUBLE</b> some government services in Arlington, but the Division of Motor Vehicles and Bureau of Alcoholic Beverage Control have a clear idea of how budget cuts will affect them. Statisticians for ABC were prepared with detailed financial analyses and developed a plan to reduce operating costs while ensuring minimal loss of profits.

Such consideration was especially important for ABC because its revenues and tax collections contributed $189 million to the Commonwealth’s general fund last year.

To cut operating costs, officials contemplated closing all ABC stores on Mondays, the slowest business day for ABC, according to Becky Gettings, a spokesperson for he bureau.

Ultimately, though, they decided the most cost-effective measure would be to open stores one hour later on all operating days. "They pulled statistics and realized … it would be much less harmful on profits [to open later and continue Monday operation]. Our slowest day still generates $50 million in profits," she said.

The change in store hours ensures that the ABC will not have to contemplate lay offs until at least 2004. Gettings said officials are already looking ahead to the possibility of further cutbacks then. "We are gathering statistics for all kinds of impacts," she said.

<b>LAYOFFS WERE UNAVOIDABLE</b> at the DMV, though.

Statewide, layoffs total 587, including more than 350 full-time employees, said Pam Goheen, a DMV spokesperson.

That translates to 11 lost jobs at the Arlington branch: two full-time employees and nine part-time workers, Goheen said.

Layoffs alone will not cut enough costs for the DMV. Of the 73 customer service centers around the state, 12 will close completely, and all will close on Wednesdays. At all branches, hours of operation will be reduced, though the extent of the changes will vary from branch to branch.

The Arlington DMV customer service center will actually be open one hour longer each day, so residents will be inconvenienced only by the Wednesday closings.

<b>FRESH FARM PRODUCE,</b> like driver’s licenses, could be harder to obtain if budget cuts affect the Virginia Cooperative Extension in Arlington.

The Saturday Farmers’ Market at Courthouse is run by the agency, which will have 12 percent of its state funding cut, on top of 8 percent already cut in budget-balancing measures.

Final decisions will be made this week to determine the exact nature of the cuts, according to Jennifer Abel, the coordinator of the Virginia Cooperative Extension in Arlington. Layoffs will be a last resort. "It will be a real shame to programs in Arlington if positions are cut up here," she said.

In some counties where state budget cuts have hit Co-ops particularly hard, county governments have stepped in to provide funding to soften the blow, Abel said. It remains to be seen whether Arlington will take similar measures.

In education, elementary and secondary schools are protected from cutbacks, by order of the governor. Sue Robinson, Arlington’s assistant superintendent for finance, said that cuts to other agencies are unlikely to have an impact on the schools, at least for now.

Higher education is a different story. George Mason University students are likely to face tuition increases and fewer course offerings, which would result in larger class size. Complete details on GMU’s budget cuts will be available this week following a meeting of the Board of Visitors.