Monday, February 12, 2007

Honey, I Lost the Revenue!

Today is the day our tax assessments will be mailed by the City of Alexandria.

How appropriate that today we are also learning about a lawsuit over tax assessments that casts serious doubt on the theory that big development slashes homeowners' tax burden.

This morning's Examiner reveals that LCOR Alexandria LLC, the owner of several properties at Carlyle including the Patent & Trademark Office site, has sued the City of Alexandria over its 2004 tax bill. LCOR, which is suing on behalf of the General Services Administration (GSA), claims the City overstated its property tax values by $500 million.

At the time it was approved, Carlyle was projected to be a billion dollar development and the deal for the PTO was the single largest lease in GSA history.

The grounds for the lawsuit? Retail at Carlyle never took off, making the properties less valuable.

But here's what the story missed.

If LCOR prevails — and the suit goes to court later this month — nearly $5.2 million in revenue will be lost to City coffers for FY 2004, based on the then-prevailing tax rate of $1.035 per $100 of assessed value.

It gets worse. An LCOR victory may also mean lost revenue of almost $5.0 million in FY 2005 (when the rate was $0.995 per $100 of assessed value) and another $4.6 million lost for FY 2006 (at the rate of $0.915 per $100 of assessed value).

Total potential damage from Alexandria's failure to deliver retail: $14.8 million.

And who do you think is going to make that deficit up?

Grrrrrrrrrrrrrrr!!!!!!!!!!

15 comments:

Anonymous said...

I can't wait until Euille leaves to run for something else. His ridiculous attitude that it's the developers' job, not the City's, to attract good retail that got us into this mess. Good riddance.

Anonymous said...

When will our assessment notices be available online? Perhaps I shall join that lawsuit... A class action perhaps?

Anonymous said...

"
Total potential damage from Alexandria's failure to deliver retail: $14.8 million."

I am not quite sure how developers caused that problem. It seems more City government's inability to assess property the right way, inability to diversify revenue, and inability to attract businesses to come here that is the problem, not how tall the buildings are.

Anonymous said...

Assessment? If you don't like your assessment, then appeal it. Alexandria could use a good tax revolt.

Anonymous said...

"Alexandria could use a good tax revolt.
"

This begs the larger question; why do Alexandrians continue to re-vote in the same leadership election after election?

It seems Kellom could run Elmer Fudd and get him elected.

Not that Alexandria Republicans are doing a great job but not one Councilman has the guts to stand up on the public housing issue, as an example, and say "this is getting out of control".

And this is all taxpayer money that has to fund these financial bailouts.

Money that, as the LCOR case indicates, we might not even have.

Anonymous said...

"This begs the larger question; why do Alexandrians continue to re-vote in the same leadership election after election?"

An excellent question. When the Mayor runs unopposed this is exactly the kind of mess voters should expect. A work of their creation. It then begs the next question: why such a low voter turnout in local elections?

Anonymous said...

I just got mine and almost started laughing. 2% increase. Where in the world is Council going to find the revenues for all these IOU's they keep committing to? They certainly are not going to have enough for the next ARHA bailout

Pedro said...

"When the Mayor runs unopposed this is exactly the kind of mess voters should expect. A work of their creation. It then begs the next question: why such a low voter turnout in local elections?"

I believe that part of the problem is that the local elections are held outside of the federal election cycle. There is simply no reason for this. It costs the city extra money to have the polls open for local elections only, and it surely depresses voter turnout.

Also, many other localities in the area do not allow candidates to be identified by party on local election ballots or to have local parties endorse specific candidates. I think a similar measure here would force candidates to gain name recognition and votes through making their positions known to the residents of the city and not simply because they have a "D" after their name on the ballot. The Democrat stranglehold on the city surely isn't producing the kind of results that are making anyone happy (as evidenced by the comments on this blog).

Anyone know how the process to get local election laws changed? Can this be done through a ballot initiative?

trf said...

Our assessment dropped by a couple of percentage points. That was a pleasant surprise.

Anonymous said...

My assessment came yesterday and I had to chuckle. No wonder the city does not want the media to leak news of GSA's lawsuit. The attached info sheet said: "While single-family and condominium values in the City generally remained stable or decreased, the commercial sector experienced gains...This decline was partially offset by new residential construction...Commercial assessments including multi-family apartments, office buildings, hotels, shopping centers, warehouses, and vacant land increased almost 11% from the previous year." How much is LCOR claiming the PTO property is overvalued?

Hartmann's managing for results is obviously a failure as Council continues to chase its revenue-bitten tail. Anyone who does business with the city knows their business is less about results and more about process. Go Feds!

Density at the Braddock Metro is a stopgap ploy nothing more. The PTO experience mostly proves it.

Anonymous said...

"I believe that part of the problem is that the local elections are held outside of the federal election cycle. There is simply no reason for this."

I so agree! Initially I think the Democrats valued it as a means of party control. Now I think seasoned civic activists value it similaly. For this we are sending our boys to Iraq to fight for democracy. Let's change the election date!

Anonymous said...

"Anyone know how the process to get local election laws changed? Can this be done through a ballot initiative?"

Cheer up, folks. The Dems hanging outside the building where I vote were already grousing about turnout. Seems they didn't like it that Andrew MacDonald got the most votes, so they're gonna push to change the election cycle for City Council. (Traditionally, Council chooses as Vice-Mayor the council member who received the largest popular vote. People who turned up to vote, presumably those who follow local goings-on, voted for MacDonald.) MacDonald is considered outside the privileged circle within the Democratic Party. The Dems figure that with a greater number of voters who wouldn't care enough to turn out for local elections otherwise, their party machine can get the "right" candidate elected to the more exalted position of Vice-Mayor, as a jumping-off point for greater political office in the future.
Yes, it's inconvenient to go to the polls one additional time every two years, but be aware that, as usual with our Great City, there are other reasons underneath the loving notion of making voting easier for us mere citizens.

Anonymous said...

"MacDonald is considered outside the privileged circle within the Democratic Party. The Dems figure that with a greater number of voters who wouldn't care enough to turn out for local elections otherwise, their party machine can get the "right" candidate elected to the more exalted position of Vice-Mayor,"

No offense but I find your reasoning a little weak. But as long as people are begging the various questions, what is the role of the city's Budget Committee? If its function in any way resembles that of an audit committee then why do politicians appoint the committee members? My quality of life is not going to be further compromised because fiduciaries can't govern. My family breathes enough exhaust fumes now. Why should I believe any of the city's projections given the PTO mess?

Anonymous said...

FYI, here in Chatham Square, we've seen a drop in house values. I don't really mind too much, since I plan on sticking around for a few years, and I own my house. From my assessment:

Assessment Information Tax Status: TAXABLE

Assessment Date Land Value Building Value Total Value
01/2007 $272,607 $403,793 $676,400
01/2006 $306,300 $453,700 $760,000
01/2005 $245,000 $345,000 $590,000
01/2004 $111,500 $0 $111,500

That's a pretty big drop. Here's hoping that my taxes go down a little as well!

BTW, you can check on any home assessment by going to http://realestate.alexandriava.gov/index.php?action=address

It is a great resource to see what your neighbors paid for their homes and what homes are selling for around the city!

The Growler said...

Even better, go to the GIS interactive maps:

http://gis.alexandriava.gov/parcelviewernet/run.htm

and you can get a birds' eye view of your neighbors' homes. Use zoom in to find a neighborhood, then use the identify tool to bring up the real estate assesment record. (Make sure you first have Parcels selected on the right side of the screen.)

Love those aerial maps!