Arlington County is facing a $8 million shortfall heading into the next budget season, which will unfold over the next few months as County Board members consider the county manager's proposed budget early next year. Expenditure growth is outpacing revenues, with expenditures growing at 3 percent while revenues are growing at only 2 percent. Part of that gap is driven by programs and initiatives such as a new homeless shelter, a new aquatics center and a technology program known as Connect4Arlington.
"It's going to be a difficult year," said Michelle Cowan, director of management and finance. "But it will be manageable in terms of budgetary decisions."
To address the gap, county officials have instituted what they call a "hiring slowdown" intended to reduce the cost of growth. And County Manager Barbara Donnellan is asking all departments to submit proposed reductions of 1 percent, an exercise intended to see what areas would be easies to cut if county leaders determine they want to make reductions to fill the budget shortfall. Some believe that the projection of revenue growth might be optimistic considering the potential damage created by twin problems of the sequester and the shutdown.
"There will be significant adverse effects over the next couple of months on the local budget situation," critic Robert Adkins told County Board members. "Don't raise taxes based on what you should have known in advance."
THE SCHOOL SYSTEM is facing a more daunting challenge, with budget officials forecasting a $16 million shortfall this year. Although county leaders and school officials have long used a revenue-sharing agreement that sets the school transfer using a mathematical formula, a number of parents say the growing inequity in the school system is troubling. For example, many parents say it's time to end early release Wednesdays in all elementary schools, a goal that would be difficult to achieve given enrollment increases and budget shortfalls.
"This should be a bigger priority in the county than so many of the other things that you are funding, which none of us will argue are not nice to have," said Jennifer Bower during a budget public hearing. "But equity in education, in terms of the amount of basic instructional hours in the school week, is a must have."
Seven out of 22 elementary schools release students early on some Wednesdays, leading to a disparity among the county's schools — one that many would like to eliminate. The Arlington County School Board has specifically identified "increased instructional time for elementary schools with early release Wednesdays" as a priority for fiscal year 2014 in order to "ensure that every student is challenged and engaged and to eliminate achievement gaps." That's a sentiment shared by many parents who have become increasingly vocal on the issue, although the estimate for getting rid of the early release days is about $4.5 million.
"My children benefit from five full days of school instruction," said Elliot Staub during the budget public hearing. "My neighbor's children do not despite us paying the same tax rate."
THE LAST DECADE has seen dramatic change in Arlington, a county that where the per capita income skyrocketed from $56,000 in 2003 to $80,000 in 2013. During that time, the real-estate boom brought windfall profits to the Arlington County Government Center as real-estate taxes proved to be a cash cow. Ten years ago, the county took in about $300 million from taxes on real estate. Today that number has doubled, and county officials are expecting to receive more than $600 million from taxes on residential and commercial property. Among jurisdictions in Northern Virginia, Arlington's recovery was the quickest and the most substantial.
"There are many jurisdictions across the county that don't have revenue growth," said Cowan. "So we feel fortunate to at least be on the positive side of the ledger."
This year, budget officials are expecting residential property to grow about 5.5 percent. That means that if County Board members keep the current tax rate, the average residential property tax bill will increase $291. Critics of the county government say Arlington leaders are spending too much money. Programs that are often criticized as boondoggles include the Columbia Pike streetcar and the Artisphere.
"Why are you continuing to fund unnecessary programs and projects?" asked Jim Hurysz, a frequent critic of the County Board. "What is needed is a moratorium on new, expensive projects."