Shirley Hackworth and the rest of her neighbors had sold out. Developer Landmark Communities bought up her house and the rest of her neighborhood and planned to turn it into a mixed-use complex along Richmond Highway at Buckman Road.
Hackworth and her husband had bought a new home in Oklahoma, where they planned to retire. She had resigned her job at the National Security Agency in anticipation of moving. Then the bottom fell out of the deal.
“However, I had the foresight to tell my employer that things were not going as well as we had hoped with the sale and I might have to stay awhile longer. Although they had already hired my replacement they have kept me on in a temporary position,” she said.
The neighborhood’s financial windfall evaporated with the collapse of the condominium market. But, not before the land upon which their homes sit was rezoned from a low-density residential area to a zone used for high density developments of considerably higher value.
As a result of the rezoning, Hack-worth’s property, and that of her neighbors, is worth more, even if the new development isn’t built. The higher value, means the residents have been hit with a steep increase in thier property taxes, even though they have no plans to redevlop their land.
Envisioned as a major development along Richmond Highway’s revitalization corridor, the Mount Vernon Gateway project was to occupy a 17-acre plot bounded by Route 1, Buckman Road and Jana Lee Avenue. Development plans called for 432 dwelling units, 55,000 square feet of office space, and 10,000 to 15,000 square feet of retail space.
The residential space was to be condos and some townhouses. Planned when the condo market was red hot, the developer offered home owners on the site top dollar for their land.
Then spirialing interest rates, plus other corporate factors, brought a series of delays. Two weeks prior to the developer selected date for closing on their sales, everything came to a halt.
Everything, that is, except the rezoning and the reassessments that come with it. Properties previously assessed at between $250,000 to $370,000 were now about $1.1 million. By Fairfax County calculations, that tax bill is about $10,000 plus per property — three to four times more than it had been prior to the rezoning.
Adding to individual homeowner anxiety was the fact that many of the property owners, like Hackworth, had already either purchased new residences, or other expensive items such as a recreational vehicles.
“I think this thing has been a scheme all along. They offered us much more to get us to agree and then they planned to reduce the offers when we were in the trap,” said Elaine Schumacher, with a home on Rolling Hills Avenue, during a residents’ meeting at the home of Steve Crane on Buckman Road.
Although Landmark Communities was to be the developer, Richard L. Labbe, president, Eastwood Properties, Inc., served as the “assembler” of the land package, according to John H. Thillman, vice president, Landmark Communities.
It was primarily Labbe who interacted with property owners during the sales, according to those assembled at Crane’s home. As part of that process, there was a contract and a power of attorney signed by a majority of the owners.
Labbe deferred all comments to Thillman.
The contract specified an anticipated closing date. The power of attorney also gave Landmark and Eastwood the right to seek the necessary zoning change prior to consummation of sale.
Thillman said this was standard procedure designed to protect the developer if the zoning change was not approved by the county. “If the zoning isn’t consummated first we could be sitting for years waiting for the process to be complete or not be able to get the change at all,” he said.
Home owners were offered on average $690,000. Each home site occupies a lot of approximately one half acre. Landmark now owns a total of six properties throughout the 17-acre plot.
“We have as much at stake, if not more, as the individual property owners. We want this project to go forward. But, it can’t get off the ground unless everyone hangs together at this point,” Thillman said.
Residents are skeptical. “Two days before the intended closing date [June 23] they [Landmark/Eastwood] gave us a new proposal. We’d get 70 percent of the original offer if we were willing to wait until March 2007 or 50 percent if we wanted our money now,” the group said, almost in chorus.
“We were all misled. We kept being told everything was okay,” Crane said. “This whole thing does seem to be deliberate to force us out because we can’t pay the increased taxes.”
Daniel Gunia and his wife Kim own a home on Buckman Road, and have kept meticulous records of the entire negotiations. “The County’s only interest in this is the revenue. They don’t care about us. They seem to be backing Labbe all the way,” he said.
That was not the view of Janet Coldsmith, director, Real Estate Division, Taxation Department, Fairfax County. The entire matter comes before the County Board of Equalization Sept. 25.
“It’s going to be a tough appraisal decision. But, we are going to do everything we can to reach an equitable recommendation,” she said. “The Board can set the market value of the properties. We didn’t agree with the developer on the value of the properties in the first place.”
The Board of Equalization will have to into account a host of factors.
“We will be considering the state of the properties. However, part of the appraisal process is that it has been rezoned. That zoning still stands on these properties,” she said.
“We have extended the due date on the taxes until December 5 in order to allow time for this to be worked out. I feel the assessments will be significantly lower in terms of those assessments under appeal,” she said.
The Board of Equalization will make the final decision about the taxes due. After that the only appeal is to the courts, said Coldsmith.
Supervisor Dana Kauffman (D-Lee) is hopeful that the project can proceed. “The value to this entire project only exists if it all proceeds as a whole. The key underpinning is the land staying together. That is also to the County’s advantage,” he said.
“I personally think we can still pull it off. We’ve taken a hard long look at the project to see if there are some other options. There isn’t enough room on the site to add more townhouses,” Thillman said.
Thillman’s optimism raises sharp criticism from the neighbors. “They knew things weren’t going well back in April, yet Labbe wrote a note to Hackworth at that same time reassuring her things were going well,” Crane said.
“At the end of May, a neighbor called Eastwood to gather information on the location and time of the closing, set for June 23. They were told closing may not happen as planned,” according to the Cranes.
That was the first time the group learned of the potential 12 to 14 month delay predicted by Thillman.
Following the June 20 phone call, three days prior to the intended closing, the homeowners were presented with the new 70/50 percent offers by Eastwood/Landmark, according to Crane.
Complicating matters further, the homeowners now maintain the existing sales contract with Eastwood and Landmark is “null and void.” If Eastwood and Landmark want to revitalize the deal the homeowners said they have two requirements: The price needs to be 100 percent as originally stated; and closing must be immediate.
“This whole homeowner/developer, sell/buy process has proven very complex and educational. Unfortunately it is not the type of education you gain from reading a book or taking a class. We’ve leaned the hard way,” Crane said.