Tax revenue is down, operating costs are up and uncertainty abounds about $85 billion in federal spending cuts that could devastate the government-dependent local economy. And it's all going to translate into lighter pocketbooks and thinner wallets for nearly 1.5 million people who call Northern Virginia home.
Local governments have begun rolling out their budget proposals for next year and, after five austere years, Fairfax County, Arlington County and Alexandria are all still facing budget shortfalls. All are planning to raise real estate taxes and cut deeper into popular services -- from neighborhood cleanups to library materials -- to cover that financial hole.
Many Maryland communities are facing similar problems. Montgomery and Prince George's counties both expect to run $100 million-plus shortfalls next year, but those localities won't produce a budget proposal or tax plans for two more weeks.
"This is what happens when you don't have economic growth," said Fairfax County Supervisor John Cook, R-Braddock. "Government contractors have been holding back because of the uncertainty. Everything's on hold."
Fairfax is considering a 2-cent real estate tax increase that, when coupled with assessment increases, would add $262 to annual bill of an average homeowner. Arlington is eyeing an increase of 3.2 cents, which would push the county's tax rate above $1 for the first time in more than a decade and also add $262 to the average tax bill. Alexandria officials are considering a 5.5-cent tax increase, though they are also looking for other taxes or fees they can raise to cover their budget hole.
It's the first time all three jurisdictions have simultaneously raised their real estate taxes in two years, after Alexandria lawmakers last year opted to keep its rate at 99.8 cents. Arlington has raised its property tax rate every year since 2007 and Fairfax every year since 2011.
"It's absurd that the county would increase taxes rather than make cuts to government operations," said Thomas L. Cranmer, first vice president of the Fairfax County Taxpayers Alliance. "And with increased assessments, people are getting hit with a double whammy."
Fairfax County Executive Ed Long proposed cutting $20.5 million from county agencies next year, including eliminating 91 jobs. He said the cuts were "made surgically, not with a budget ax," to temper the hit on popular programs.
Alexandria City Manager Rashad Young proposed raising the city's motor vehicle tax, tobacco tax and parking fees to close a $31 million funding gap. He also asked City Council to cut $13.8 million in spending by eliminating the Arlandria-Del Ray trolley and 28 city jobs.
Arlington is also proposing $9.3 million in cuts to county agencies, eliminating 46 county jobs. The remaining workforce will be required to "absorb much of the workload" once the cuts are made, County Manager Barbara Donnellan said.
All three localities will host series of public hearings before adopting the budgets in the spring.
"You don't go about increasing the tax rate at a time when people are being furloughed," said Fairfax County Supervisor Jeff McKay, D-Lee. "We need to take in more feedback from the public."