Council Advertises Eight Cent Reduction

Council Advertises Eight Cent Reduction

Council members could still provide more tax relief.

The Alexandria City Council voted Tuesday night to advertise an 8-cent property tax reduction which will increase the average taxpayer's bill by 12 percent. The council proposed a real estate tax rate at $0.915 for every $100 of assessed valuation -- four cents less than the city manager's proposed budget and eight cents less than the current rate.

By advertising this rate reduction, council members are now committed to cutting the tax rate by at least 8 cents. Because real estate values have increased by an average of 21 percent, an 8-cent property tax rate reduction would increase the average property tax bill by $418. Council members could still choose to lower property tax bills more during the budget process, which will culminate on May 2.

At Tuesday night's meeting, several council members mentioned that they have been inundated with calls about rising tax bills. The drama started on March 8, when City Manager James Hartmann proposed a $566 million operating budget for fiscal year 2006. His proposal, which included lowering the property tax rate by four cents, was immediately challenged at a City Council meeting. Mayor William Euille proposed an 8-cent reduction.

"AS OUR CITIZENS are already cognizant, we the City Council have been saying for many weeks and months now that we're going to work very diligently to massage the budget to lower that tax rate as low as we can get it," said Mayor Euille at the beginning of Tuesday night's meeting. "And so I would like to throw out for consideration this evening that we advertise a rate of eight cents as opposed to the four cents that the city manager has offered in his recommendation."

Council members agreed with the mayor's recommendation.

"I think it's important for people to recognize that by advertising the rate at this amount, this sets the minimum at which the council can lower the rate by," said council member Rob Krupicka. "I think eight cents is a good goal to have. Obviously we're going to look to see if we can do better than that."

"This council recognizes that there is a very serious problem that residents all over Northern Virginia face with the rapidly escalating value in property," said council member Andrew Macdonald. "I certainly support this motion as a first step in looking at this problem."

"I'd like to add my name to all of those who are so mindful of the struggle that many people are having throughout the community because we do understand that this really has been a significant tax increase," said Vice Mayor Del Pepper. "We are working in all possible areas to diversify our tax base wherever we can as well as to save money where we can but we must be mindful that this is a city that is demanding of a very high level of quality services."

THE VICE MAYOR also took an opportunity to chastise demands placed upon the city government by the United States Congress and Virginia's General Assembly.

"I also want to remind people of the fact that there are so many unfunded mandates out there. It just isn't fair," said Pepper, noting the burden the animal shelter places on the city budget. "We have to offer that shelter. That is over a million dollars a year."

Council member Ludwig Gaines took time to thank the mayor for "making sure that council is going to do the responsible thing for the city" by lowering the property tax rate by at least eight cents.

"I certainly support setting the initial bar at eight cents," said Gaines, who also mentioned the burden of unfunded mandates. "I firmly believe that the challenge we face as a city is the long-term economic sustainability of our community, and we've got to look at diversifying our tax base."

Council member Joyce Woodson also took a moment to challenge the burden that unfunded mandates place on Alexandria's budget.

"The state actually seems to manage municipalities better than they manage state government, and that concerns me quite a lot because it's a lot easier for them to tell us what to do than it is for them to do what they need to do," said Woodson. "We're suffering at a local level, but we need to exercise our will and tell our representatives that we don't like the way we are being treated and we want to do something about that and we want them to do something about that."

COUNCIL MEMBER Paul Smedberg thanked the city's staff for its work in creating the budget.

"I think the most important thing to keep in mind is that we have a budget that reflects the priorities and the diversity of Alexandria, and I think city staff really does a great job doing that," said Smedberg. "I look forward to working with them to makes sure that we have a budget that reflects the priorities and the desires of people in this community."

Before voting on the ordinance, the mayor noted that the council has a fiduciary duty to be "responsible and responsive," adding that "we must never give away the store."

"We can't bankrupt this city, and we must do everything to ensure the integrity of the process," said the mayor. "We have a responsibility to provide tax relief to our homeowners."

The mayor ended his speech with a pitch to community groups that are advocating a lower tax rate, saying that they should lobby in Richmond for a local income tax. Euille said that this would diversify the tax base and shift the burden away from property owners.

An April 4 meeting is scheduled at 4 p.m. for public comments about the budget.