Loudoun's Tax Rate is $1.14

Last night the Board of Supervisors voted on, and passed, a county property tax rate of $1.14 per $100 of assessed value.

Property taxes in Loudoun County appear to be on the rise, as the Board of Supervisors decided last night to assume a tax rate of $1.14 -- up from the current rate of 96 cents.

The rate is not yet set in stone. It means the county will re-work its proposed budget under the assumed rate to see what expenditures it will be able to finance. A vote to formally adopt a tax rate for fiscal year 2009 is expected April 1.

Jim Burton (Blue Ridge District) moved to adopt the $1.14 tax rate early in last night's work session. The motion was seconded by Sally R. Kurtz (Catoctin District) and passed 5-to-4, with Chairman Scott K. York (At Large), Vice Chairwoman Susan Klimek Buckley (Sugarland Run District) and supervisors Eugene Delgaudio (Sterling District) and Lori Waters (Broad Run District) opposed.

A motion introduced by Buckley and seconded by Kurtz (Catoctin District) to adopt a rate of $1.152 was defeated. - LoudounExtra

This rate will surely stir some impassioned debate in Loudoun, as some sectors lament any increase (never mind the fact that the legally mandated services the County must provide are increasing) and other sectors lament the lack of even greater funding. It is valuable and interesting, before the words start flying, to actually analyze the impact of the new rate on the average Loudoun household.

You can see a house's assessed value on the county website: Loudoun County Real Estate Tax, Assessment & Parcel Database. To calculate what the passed rate means for your 2008 taxes, divide your home's assessed value by 100, then multiply by $1.14. Thus, if you have a $400,000 home, your taxes would be $4,560 for the year ($400,000 / $100 = $4,000 x $1.14 = $4,560). If that house kept the same assessed value from 2007 to 2008, county taxes would increase by $720 from 2007 to 2008, since the 2007 tax rate was $0.96 ($400,000 / $100 = $4,000 x $0.96 = $3,840), a rate which Supervisor Burton said "cut things way too close."

Of course, the average assessment in Loudoun declined 10% in 2008.

While Kaufman did not reveal all of the county's district-by-district information, he said that Sterling saw the greatest decline in residential values, 18 percent on average. Ashburn saw an average drop of 10 percent in every residential category, while condos in Leesburg took the greatest category hit, dropping an average of 30 percent in assessed value. Overall, Kaufman said, the eastern portion of the county saw the largest decline, which he said is natural - Leesburg Today

Thus, a $400,000 home in 2007 would only be worth $360,000 in 2008, changing the tax calculation ($360,000 / $100 = $3,600 x $1.14 = $4,104) and reducing the year-to-year tax increase to only $264. Consider also that inflation was 4% from February 2007 to February 2008. Thus, inflation alone would increase the house's taxes $154, from $3,840 to $3,994.

That means that our Supervisors only increased our taxes $110 more than would have happened from natural inflation alone. That is an effective increase of merely 2.9%, at a time when the school system is absorbing over 3,200 new students each year, meaning they need over $42,000,000 more than last year just to keep everything equal (without any teacher raises or new programs).

But let us not forget that none of this takes place in a vacuum. Loudoun's taxpayers will be receiving anywhere from $300 to $1,200 (or more!) from the Federal Government later this year. So, from a whole-tax-burden perspective, the average Loudoun household actually comes out ahead in 2008, by something in the neighborhood of $100 to $1,100. The Federal stimulus payments will completely cover the County increase with hundreds of dollars left over. Thus, any complaints about "higher taxes" are not only baseless, they're factually disingenuous.

Considered as a whole, everyone's 2008 government taxes will be lower at the $1.14 rate.

Of course, this begs the question, "Why $1.14? Why not $1.15 or $1.21?" The original budget from the County Administrator proposed a $1.216 rate. As late as last night, $1.152 was on the table. The short answer as to why the rate wound up at $1.14 is votes on the Board. A strong plurality were in favor of a radically lower rate, anywhere from Supervisor Delgaudio's $1.07 to Chairman York and Supervisor Waters' $1.10. When Supervisor Buckley proposed a rate of $1.152, which would have enabled the School Board to reward our excellent teachers with some merit increases, only Supervisors Buckley, Kurtz and Burk supported it. To put it simply, the votes for a higher rate were not there.

And so, when a compromise rate of $1.14 was proposed by Supervisor Burton, Supervisors Burk, Miller, McGimsey and Kurtz had the political courage to pass it over the objections of Supervisors Delgaudio, York and Waters, who are not willing to pay for the services we actually need, and Supervisor Buckley, who decided to stand on principle and let her Democratic colleagues make a difficult decision by the barest majority.

It should be noted that even now, the debate is not yet done.

The rate is not yet set in stone. It means the county will re-work its proposed budget under the assumed rate to see what expenditures it will be able to finance. A vote to formally adopt a tax rate for fiscal year 2009 is expected April 1. - LoudounExtra

So, The five Supervisors who voted in favor of this rate did not make it law, they merely established that there is a working majority on the Board of Supervisors who are likely to support a budget at the $1.14 rate when the budget itself is up for a vote. A week remains during which advocates can try to put together their own working majority for a higher (or lower) rate.

It is these kinds of decisions, discussions and compromises that we elected our Supervisors to make. I, for one, applaud the Supervisors for taking a very difficult situation, and making the best of it they could with the votes they had.

Supervisor Kelly Burk gets the last word.

"The previous leadership did not plan for the economic downturn that we all saw coming and they used one-time funding sources to prop up their budgets, and continue to allow and encourage uncontrolled growth that has left us in the situation we find ourselves in today," she said. - LoudounExtra