Revenue Overview FY 2019 PROPOSED BUDGET HIGHLIGHTS. County Board Work Session February 28, 2018

Transcription

1 FY 2019 PROPOSED BUDGET HIGHLIGHTS County Board Work Session February 28, 2018

2 General Fund Revenue by Source 2

3 Local Tax Revenue by Source (General Fund) Real Estate: Condominium, 9% Personal Property: Bus. Tangible, 4% Real Estate: Residential, 26% Personal Property: Vehicles, 7% Real Estate: Commercial, 19% BPOL, 6% Real Estate: Apartments, 14% Other, 2% Communication Tax, >1% Local Sales Tax, 4% Transient Occupancy Tax, 2% Meals Tax, 4% Utility Tax, 2% 3

4 Summary of Proposed Budget Changes FY 2018 Adopted FY 2019 Proposed Budget Impact Percent Change Real Estate (existing rate: $0.993) $715.0 $ $ % Personal Property $115.5 $ $ % Business License $63.1 $65.6 +$ % Sales $42.0 $43.3 +$ % Meals $39.9 $41.5 +$ % Transient Occupancy $25.5 $26.0 +$ % Other Taxes $38.1 $42.1 +$ % Total Taxes $1,039.0 $1, $ % License, Permits, & Fees $10.8 $ % Charges for Services $59.2 $ % State $73.2 $ % Federal $15.2 $ % 4

5 Tax & Fee Changes REAL ESTATE Base rate: $0.993 proposed & advertised, no change from CY 2017 No change to Stormwater ($0.013) or Transportation ($0.125) BIDS: Proposed increase to Ballston BID up $0.008 to $0.053, no change to Rosslyn or Crystal City BIDs UTILITY TAXES Commercial rates increase approximately 5%, residential rates increase to $3/month per utility; revenues go to Affordable Housing and Schools PARKING RATES, HOURS & FINES Rates increase $0.25/hr Hours extend to 8 p.m. Fines to $40 FEES & COST RECOVERY DPR, ACFD, DHS, DES & CPHD permit fees, Credit Card Convenience Fee, Household Solid Waste up $2/year (full cost recovery), Recycling Inspection 5

6 Tax & Fee Burden on Average Household CY 2015 CY 2016 CY 2017 CY 2018 at $0.993 Percent Change '17 to '18 Real Estate Tax (includes sanitary district tax) $5,848 $5,981 $6,209 $6,447 4% Personal Property (taxpayer share only)* ,024 6% Annual Decal Fee* Refuse Fee** % Water / Sewer Service** Residential Utility Tax** Total $7,961 $8,172 $8,446 $8,743 4% Increase in Tax & Fee Burden $216 $212 $274 $297 * Assumes two conventional vehicles per household, the approximate average number of vehicles owned per Arlington household. The personal property tax figures reflect the PPTRA subsidy for personal property tax relief. For CY 2018, it is projected that 28% of vehicle value between $3,000 and $20,000 will be exempt from taxation; ** Reflects the next fiscal year. Water/sewer rate reflects 60 thousand gallons of water consumption. Residential utility tax assumptions are based on the ceiling tax rates. 6

7 Real Estate Assessment Information FY 2019 PROPOSED BUDGET HIGHLIGHTS

8 Real Estate Taxes Background: Largest revenue source: FY 2019 proposed totals $730.3 million at $0.993 rate Paid by owners of residential and commercial properties Reassess properties annually Residential and commercial assessments based on fair market value Split between commercial and residential properties has been about 50/50; any change to this split shifts the tax burden Revenue growth is dependent on assessment growth, new construction, and the tax rate Legal limitations: Localities control the level of the real estate tax rate Legally required to have a unified tax rate; cannot have differentiated rates for different property types without state authorization 8

9 General Fund Comparative Tax Burden 9

10 Who Pays Real Estate Taxes? CY 2018 ASSESSMENTS $74,785 million RESIDENTIAL 52.0% COMMERCIAL 48.0% Houses/Townhouses: 38.3% Condos: 13.7% Apartments: 21.0% Office: 17.6% General Commercial: 6.2% Hotels: 3.2% 10

11 Average Single Family Home Assessment $700,000 $650,000 $600,000 $550,000 $587,100 $603,500$617,200 $552,700 $520,100 $503,200 $510,200 $519,400 $524,700 $640,900 $500,000 $450,000 $400,000 $350,000 $300,000 $250,

12 Other Taxes FY 2019 PROPOSED BUDGET HIGHLIGHTS

13 Personal Property Tax Revenue Second largest tax at $119.1 million in FY 2019 Proposed Budget Levied on tangible property of individuals (vehicles) and businesses (machines, furniture, equipment, fixtures, & tools) Business Tangibles influenced by vacancy rates & reinvestment by businesses State does not limit the rates but Business Tangibles rate cannot exceed vehicle rate $120.0 $36.2 $33.5 $35.6 $37.2 $37.5 $39.7 $100.0 $80.0 $ Millions $60.0 $40.0 $20.0 $- $74.5 $75.2 $76.2 $77.7 $78.0 $79.4 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 Adopted Vehicle Business Tangible FY 2019 Proposed 13

14 Average Vehicle Value 14

15 Personal Property Tax Relief Proposed Formula for Allocation of State Relief Monies Clean fuel vehicles & Vehicles Equipped to Transport the Physically Disabled 100% exemption on first $3,000 of value 50% exemption on value from $3,001 $20,000 No exemption on value over $20,000 Less than 50 qualified vehicles to transport the physically disabled and over 5,700 clean fuel vehicles in CY 2017 Conventional fuel vehicles 100% exemption on first $3,000 of value Balance of remaining subsidy provided to conventional fuel value from $3,001 to $20,000 Current assumption is that 28% exemption will be available for this portion of vehicle value 15

16 Regional Personal Property Tax Rates 16

17 Business, Professional, Occupational License Tax Businesses gross receipts are taxed at various rates Largest source is Professional Services at over 50% of total Very few states have a business gross receipts tax Higher rates limit economic competitiveness State has set maximum rates; Arlington rates are lower than the maximums $70.0 $65.0 $60.0 $62.8 $59.0 $60.2 $63.8 $63.1 $65.6 $ Millions $55.0 $50.0 $45.0 $40.0 $35.0 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 Adopted FY 2019 Proposed 17

18 Sales, Meals, & Transient Occupancy Taxes 18

19 Utility Taxes Current Rates Proposed FY 2019 COMMERCIAL $ $ /kWh (no max) $ $ /CCF (no max) $ $ /kWh (no max) $ $ /CCF (no max) Current Rates Proposed FY 2019 RESIDENTIAL $ /kWh ($3 max & 400 kwh exempt) $0.045/CCF ($3 max & 20 CCF exempt) $ /kWh ($3 max & no exemption) $1.380/CCF ($3 max & no exemption) 19

20 Other Tax Revenue FY 2018 Adopted FY 2019 Proposed Budget Impact Percent Change Communications $7.1 $6.8 ($0.3) (4.2%) Recordation $5.3 $5.5 $ % Car Rental $6.5 $7.4 $ % Cigarette $2.3 $2.4 $ % 20

21 Non-Tax Revenue FY 2019 PROPOSED BUDGET HIGHLIGHTS

22 Tax & Fee Compendium Summary of Taxes & Fees posted in the budget online Updated as a part of budget preparation Annual review of fees with each department Link 22

23 Non-Tax Revenue Charges for services (up $3.1 million / 5.4%) Increase in parking meter rate ($0.25 per hour) and extension of enforcement to 8 p.m. Increased revenue from household solid waste rate ($ to $316.16) Credit card convenience fee Increased utilization of DPR s fee reductions Fines, Interest, Rents (down $0.3 million / -1.7%) Adjustment to interest Increased parking meter violation fines from $35 to $40 Restructured recycling inspection fee Licenses, Permits, Fees (Up $0.6 million / 5.1%) Highway permit & DES development services fee increases Fire system testing fee and hazmat inspection fee increases 23

24 State & Federal Revenue State revenue up 3.1% ($2.2 million) Mental Health/intellectual disability funding Highway aid up Law enforcement up based on Governor s budget General Assembly Action Budget conferees negotiating two versions of the budget Conference report due by March 8 Set to adjourn March 10 Adjustments to FY 2019 estimates will be recommended by the County Manager at 3rd Quarter Review Federal revenue up 7.5% ($1.1 million) primarily due to increased social service revenue 24

25 Comparison to Other Jurisdictions FY 2019 PROPOSED BUDGET HIGHLIGHTS

26 Peer Comparison: Assessments CY 2018 Total Assessment Change CY 2018 Residential Assessment Change CY 2018 Commercial Assessment Change Arlington 1.9% 3.9% -0.2% Alexandria 2.4% 3.4% 0.9% Fairfax County 3.6% 2.2% 3.8% Loudoun County 6.6% 5.8% 9.9% Falls Church tbd tbd tbd 26

27 Real Estate Impact on Homeowner Regionally 80% Residential assessments as a percentage of total tax base 75% 70% 65% 68% 73% 68% 76% 76% 75% 76% 75% 74% 74% 73% 73% 73% 73% 73% 70% 71% 70% 70% 70% 70% 70% 70% 69% 74% Fairfax 74% County Falls 71% Church Loudoun 67% County 60% 55% 50% 56% 54% 58% 56% 56% 54% 55% 56% 57% 51% 51% 51% 57% 57% 57% 51% 51% 51% CY 2009 CY 2010 CY 2011 CY 2012 CY 2013 CY 2014 CY 2015 CY 2016 CY 2017 CY % 52% Alexandria Arlington County 27

28 Peer Comparison: Real Estate Tax Rates CY 2017 CY 2018 Proposed CY 2018 Advertised Arlington $0.993 $0.993 $0.993 Alexandria $1.130 $1.130 Fairfax $1.130 $1.155 Expected Mar. 13 Expected Mar. 6 Loudoun $1.125 $1.090 $

29 Peer Comparison: Tax Burden $10,000 $9,000 8,929 8,467 8,519 8,741 $8,000 $7,000 $6,000 $5,000 5,505 5,547 5,115 4,886 5,775 5,771 5,318 4,694 6,586 6,447 6,209 5,981 6,113 6,188 5,971 6,025 5,593 4,978 5,115 5,071 $4,000 $3,000 $2,000 $1,000 $0 CY 2014 CY 2015 CY 2016 CY 2017 CY 2018 Proposed Arlington Alexandria Fairfax County Loudoun County Falls Church 29

30 FY 2018 update FY 2019 PROPOSED BUDGET HIGHLIGHTS

31 FY 2018: Mid-year preview Revenue Compared to Budget Real Estate Vehicle PP Business Tangibles BPOL Sales Meals TOT Utilities Recordation Other Taxes Nontax revenue Included in FY 2019 Proposed Unknown but refund risk 31

32 FY 2019 PROPOSED BUDGET HIGHLIGHTS County Board Work Session February 28, 2018