Another Tale Of Two Counties
Yesterday, we lauded the accomplishments of two Arlington County Civic Federation committees (Revenues & Expenditures and Schools) to craft a budget that balanced the FY 2010 county budget that met the guidance laid down by the Arlington County Board last November. The County Board directed the Manager to produce a balanced budget at a tax rate that kept the average residential tax bill flat, unchanged from CY 2008.
The picture is significantly different in Arlington’s Northern Virginia neighbor Loudoun County. The Tax Foundation’s tax policy blog noted yesterday, including a reference to this story in the Washington Post’s Loudoun Extra:
“Forty miles northwest of Washington, D.C. lies Loudoun County, Virginia, home of Dulles International Airport, Verizon Business, and 19 wineries. Between 1998 and 2008, the county's population grew 98% as Washington-area workers spread out into the exurbs in search of cheaper, newer, and bigger houses. That flow has now reversed, with Loudoun taking one of the biggest hits in the bursting of the housing bubble.
“Loudoun County may have been America's fastest growing county, but it now has a few other records it might be less proud of. On April 7, Loudoun County supervisors voted 6-3 to approve a 9% increase in property tax rates for the Fiscal Year 2010 budget, taking the rate to $1.245 per $100 in value, the highest of any Northern Virginia county. (Tax burdens for many will drop due to the collapse in home values, though overall spending is still going up from 2009.)
“Inconvenient for the argument that tax rates must go up to avoid painful budget cuts is the fact that between 1996 and 2008, Loudoun County government spending grew 466% (from about $230 million a year to $1.1 billion a year), while inflation went up 39% and population went up 146%. In only three years was the growth inflation+population—which were in double digits many years—less than the growth in government spending. That difficult to sustain, especially if you understood that housing growth was not sustainable.”
The Tax Foundation post includes two charts, including the following one, that illustrate the growth in county government spending contrasted to the growth in inflation and population. A chart of the growth in Arlington County spending over the same period would likely show similar differences.
