It will either save Fairfax County or ruin it. Either way, the proposed 5 percent real estate tax cap has become a hot button issue in several supervisor races including the contest for chairman of the board. It has caused a rift among the county's Republicans at the same time as the GOP is trying to reclaim the board's majority.
The split within the party became apparent at Monday's board meeting when Supervisor Elaine McConnell (R-Springfield) made a motion that the board go on record as opposing the cap because, she said, she was "very concerned" it would harm the county's economy.
McConnell said she was relaying the wishes of the Economic Advisory Commission, a group of business leaders and supervisors that asks the board to take positions on economic issues.
On Friday, the commission heard a report from Susan Datta, the head of the county's Department of Management and Budget, predicting that a tax cap would so severely depress the county's growth that supervisors would have to make an additional $45 million cut in next year's budget. After hearing the report, the commissioners recommended that the board express its opposition to the cap.
Supervisors Michael Frey (R-Sully) and Stuart Mendelsohn (R-Dranesville) reacted angrily to McConnell's motion, objecting that the commission had manipulated county staff to score political points.
"It was outrageous that our staff was being used in such a way," said Mendelsohn.
"I am offended by those remarks," McConnell shot back." [The commission] has never been involved in politics."
She added that the commission had requested the information in June, before the current electoral season got underway.
Frey, who worked on McConnell's staff before he was elected, said there was a "clear public perception" that supervisors on the commission had sought to involve county employees in the political debate.
"You can stand there self-righteously and indignantly and say that you're not doing this," he said. "But it's clear what's going on."
After the argument, Frey said McConnell was "clearly out of step with the rest of the party."
At issue is a Republican plan to impose a 5 percent ceiling on the amount of real estate tax revenue the county generates. By contrast, revenue from real estate taxes went up about 8 percent last year. But residential taxpayers saw their bills go up almost 10 percent to make up for lost commercial real estate taxes due to the economic downturn. The year before that, the average homeowner saw a 16 percent tax increase.
THE ISSUE HAS gained political traction as residents have listened to candidates' debates over the last month. After one of these events last week, Fair Lakes resident Jose Ramos said he was convinced the cap was a good idea.
"They spend too much money," he said. "They need to have control." A cap would still allow growth, he said, adding "they're not really cuts."
Four conservative candidates for supervisor — Hunter Mill's Doug Bushee, Providence's Jim Hyland, Mason's Buzz Hawley and Mychele Brickner, who is running for chairman — have promised to vote against any budget that increases real estate tax revenue by more than 5 percent. Frey and Mendelsohn did not sign the pledge.
Brickner has called the cap a necessity to force the county to "live within its means." Meanwhile, her Democratic opponent Gerry Connolly has characterized it as a "risky scheme."
What the cap does, Brickner said, is "reduce the amount of increase and that's just not a cut in anybody's book."
At the same time, she said, the county needs to scale back its spending to lessen the tax burden. But she has so far declined to give any specifics on where the reductions would come from.
But the fact that the county budget would still show overall growth may not be enough, according to Susan Datta, director of the county's Department of Management and Budget.
"Revenue grows every year," she said. "The issue is does it grow in response or at the same rate as our other requirements."
Taking into account the fact that money from the state and the federal government is unlikely to increase considerably next year, she predicted in her Economic Advisory Commission report that the 5 percent cap on the real estate tax would limit the county's overall revenue growth to 3.7 percent, as opposed to the 5 percent growth she predicted without the cap. Real estate values are expected to grow at about 7.1 percent this year, down from last year's 12.5 percent leap.
Even without the cap, County Executive Anthony Griffin warned that the rate of growth was not enough to sustain the county's needs and that he would have to scale back certain services and programs to balance the budget for the fourth year in a row.
"We're at a point now where one person's fat is another person's priority," he said.
Democrats have seized on the statistics presented by county budget officials to argue that a cap would slash essential services.
"There are real consequences behind these numbers," said Connolly. "The biggest hit would have been schools."
On Monday, Connolly defended the commission, on which he sits, from the charge that it had politicized county staff. He also derided Frey and Mendelsohn, calling them "the two know-nothings on the Board of Supervisors."