Alexandria city officials soon will have to decide whether to raise the city’s commercial property tax rate to help future transportation projects, but first will hear recommendations this month from a panel appointed to study the issue.
“We’re being very careful about this,” said City Councilman Rob Krupicka. “We’re taking a very cautious look at it because we have a lot of small businesses in Alexandria that would be impacted by this.”
Virginia last year passed legislation granting jurisdictions permission to raise their commercial property tax rates by up to 25 cents for every $100 of assessed value as long as the money specifically funds transportation projects.
Fairfax County, Arlington County and Alexandria have passed legislation that would let them increase the rate this year, though none has done so.
In December the Alexandria City Council appointed a committee to study whether — and by how much — the rate should be raised. The committee is expected to make its recommendation to the council by the end of this month.
The Alexandria Chamber of Commerce, which has one representative on the five-member committee, already has objected to any raise that would tax commercial properties more than residential ones.
“Business already brings more value to the city budget and costs the city less in demand for services than residential property,” the chamber’s board said. “Further unequal taxation would, we believe, discourage commercial growth and could cause Alexandria to become a bedroom community without the tax base to sustain public programs and services the citizens want and need.”
Alexandria’s transportation costs are estimated to reach up to $1 billion over the next 15 years, said Deputy City Manager Mark Jinks, who is working with the committee. That includes the cost of buying more hybrid buses, expanding the city’s local DASH bus system, contributing more to Metro and adding a bus rapid transit system.
“There is a very large list of items — this tax could help with some of that,” Jinks said. “It’s going to take also federal money, state money, city money, contributions from developers — it’s going to be a whole variety of funding sources to address the transportation needs over time.”
The taxmen cometh?
The makeup of Alexandria’s Ad Hoc Commercial Tax Option Study Committee:
» Two members of the city’s Ad Hoc Transportation Task Force
» Two members of the city’s Budget and Fiscal Affairs Advisory Committee
» One representative from the Alexandria Chamber of Commerce
