BOE Rules Gateway Never Assembled
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BOE Rules Gateway Never Assembled

BOE tells the county to assess again — property by property.

This time the light at the end of the tunnel was not an oncoming train. It was much-needed aid for homeowners in Lee District’s Rolling Hills subdivision that was to become “Mount Vernon Gateway.”

That aid came in the form of sympathetic understanding from the Fairfax County Board of Equalization at a public hearing on Sept. 25 at the Fairfax County Government Center. Its final decision could prevent a large group of home and property owners from being forced into foreclosure and bankruptcy. At the heart of the appeal by the property owners was an increase in the assessed value of their homes from a range of $200,000 to $400,000 to over one million each. That took their taxes from an average range of $3,000 to $4,000 per year to $10,000 plus.

The cause of this escalation was a change in zoning status from residential to PDH 30 which applies to multi-family, mixed-use development. That change was brought about by an application from developer Eastwood Properties/Landmark Development which planned to acquire all the homes on the 17-acre plot, demolish them, and create a development comprised of mid-rise condominiums, town homes, and supporting amenities to be known as “Mount Vernon Gateway.”

With the changing economic dynamics in real estate, particularly in the condominium market, the developer never went to settlement on the “assemblage” of properties it needed. The county, however, proceeded with the rezoning, thus increasing the assessed value of each property resulting in tripling and quadrupling the tax burden on the property owners.

Exacerbating the situation, the contracts signed by the homeowners with the developer prohibited them from improving their properties. Some of this tax burden also fell on the stymied developer, which had purchased six properties in the area for amounts ranging from $600,000 to $800,000-plus, far exceeding their market value and skewing the assessment picture. Four of those properties are now boarded-up, negatively impacting the overall area, according to homeowners.

MONDAY NIGHT both property owners and developers took their case to the board to have the assessments revert to their 2005 status. Based on the BOE staff report, recommendation the board indicated that at least a 40 percent reduction in the assessed values was warranted.

However, a formal decision was postponed based on the actual reappraisal of the individual properties to be undertaken over the next several weeks. Another meeting has been scheduled for Nov. 6, when the county will present new facts, according to Steven Crane, one of the impacted home owners.

“The chairman seemed pretty much on the side of the homeowners. He also questioned the county why the properties were rezoned before the developer had completed the assemblage,” Crane said.

Most of the properties are located along the east side of Buckman Road parallel to Route 1. “The last home to be sold on the open market was 3501 Buckman Road in December 1999 for $200,000. The assessed value of the home at the time was $180,000,” Crane told board members in his testimony.

“This tax assessment will cause us to go into foreclosure if it is not returned to its former status. The thought of foreclosure and bankruptcy are not thoughts that any of us wish to entertain,” said Lesa Crane in separate testimony.

Steven Crane also acknowledged the developers were somewhat caught in the same trap. “Even though we feel we have been mislead by Eastwood Properties and Landmark Development corporation we understand that they have fulfilled their promises in other contracts in the past and that due to circumstances beyond their control have proceeded as capably as they know how in this situation,” he stated for the record.

That assessment was buttressed by John H. Thillman, vice president, Landmark Communities of Arlington, developers of the site. “We have as much at stake here as the individual homeowners and perhaps even more. We are sitting on six properties,” he said following the BOE hearing.

“Basically, the board is looking to cut the overall assessment of the site by approximately 50 percent, from $36,269,650 to the staff recommended $18,485,730. Based on our testimony and that of the property owners the board agreed there was no assemblage of the site,” Thillman said.

HAD THAT assemblage been successful, the site bounded by Route 1, Buckman Road and Janna Lee Avenue, was to have been developed into 432 dwelling units, 30 affordable housing units, 70 units for those 55 years of age and older, 55,000 square feet of office space, and 10,000 to 15,000 square feet of retail space, according to Thillman. A majority of the dwelling units would have been condominiums.

As stated by Warren Griffith, representing his mother Chang Griffith at the hearing, “The county made a mistake in rezoning the properties. Obviously, this is also our mistake since we asked for the rezoning [as part of the sales contract with Eastwood Properties]. But, the county has made the same mistake as the rest of us which was making a deal with the developers in the first place.”

He also emphasized, “I can state with certainty that my mother will not sign another contract like the previous ones with Eastwood Properties, nor Landmark, with whom we’ve never had any contact anyway. Given their track record, it is hard to believe that they would ever obligate themselves to the extent that would be required.”

The deadline for consummating the various deals was June 23, 2006. Homeowners were told by the developers that would not happen only days before, according to their records.

“The county’s mistake has been no worse nor better than the mistake made by the homeowners, but by reinstating the appropriate assessments ... it can help homeowners defend against the predatory maneuvers of the developers,” Griffith said.

One couple who have kept meticulous records of the entire saga is Buckman Road residents Daniel J. and Kim Gunia. “The new zoning and associated tax burden effectively removes the possibility of selling our home to all but Mr. Dick Labbe, Eastwood Properties and Landmark Developers to remove ourselves from this burden,” they told the board.

“Who would purchase our homes knowing the details of the zoning and property tax situation? This is attested to by the fact that two of the homeowners have placed their homes on the market and have been unable to find anyone to purchase them under their current circumstances,” said the Gunias.

Based on his records the pre-reassessment value of eight homes on Buckman Road totaled $3,134,890 collectively for an average assessed value of $391,861. Two others, one on Buckman Road and the other on Janna Lee Avenue had an average assessment of $180,145.

“The board sent the county assessors back out. When they were doing their assessment for the rezoning they took a shotgun approach and were looking at homes much higher in value than our group,” Dan Gunia said.

“We are also going to come up with our own numbers and present those to the Board at the next meeting. We think the values should come down even more,” he said.

At the conclusion of the hearing the indication was that individual properties will probably revert to their 2005 tax status plus an escalation cap of an estimated 22 percent realized by many residential properties in southeastern Fairfax County. It is expected that decision will be made at the Nov. 6 hearing.