VCC Magazine Spring 2020

V irginia C apitol C onnections , S pring 2020 5 General Assembly Opens a Door for Today's Economy By Delegate Vivian Watts In 1928, cities were given full tax authority while counties were held to only taxing real estate—the measure of wealth in colonial times. Almost a century later, the 2020 General Assembly finally has opened the door for county governments to operate in today’s economy. Arguably, the real estate tax is the most regressive tax. It does not reflect the ability to pay for most residents on a fixed income that inevitably drops further and further behind the increasing value of their home. High real estate taxes worsen housing affordability, whether passed on in rent or paid directly. The lower the income, the greater the proportion of it that has to be spent on housing: Few with incomes above $50,000 pay more than 30% on housing, while the majority of those under $30,000 pay over 50%. Each of the taxes that cities have long had the authority to enact—without a referendum and without rate limits – are significantly more progressive than the real estate tax. These taxes tap discretionary spending and include non-residents. Now, county Boards of Supervisors will have the same authority to decide on broadening their revenue base to these sources of revenue in keeping with their local economy. However, the tax rates counties can enact are capped by the legislation: 40 cents a pack on cigarettes, 6% on meals, 10% on admissions, and requiring 3% of any hotel/motel tax rate be spent on tourism. The importance of governments having a broad base of revenue has been underscored by the coronavirus economic fallout, by the 2008 housing financing collapse, and by Virginia’s slow recovery from the resulting recession because of cuts in federal spending rippling through 30% of Virginia’s workforce. When there is a fall-off in one revenue source, others stop the freefall and basic government services can be delivered. Decades ago, cities were the center of commerce and their taxing authority reflected that. County residents coming into town to shop or work increased the need for services—and it was politically convenient to get tax revenue from non-residents. Now, hubs of commerce are increasingly found outside cities.Whether it is Tysons Corner mixed-use in Fairfax County (which was the 12th-largest employment center in the nation in 2008), suburban shopping malls, or fast food stops off our interstates, all represent the potential for real estate tax relief. Today, Virginia’s largest counties dwarf most cities. Of the 10 most populous jurisdictions only 4 are cities, while among the smallest, only 5 are counties. With population density, comes increased need for services. Since cities receive direct payments from the state to maintain their streets that are higher than the state spends on county road maintenance, the funding challenges of density are centered on mental health, social services, law enforcement, and meeting diverse educational needs. Adequately funding education is the top challenge. While all localities are helped by the state to fund K-12, the amount of help is set by a formula based on a theoretical ability to pay that is significantly unrelated to a county’s actual ability to tax. Equalizing city and county tax authority will address the inequity in 40% of ability to pay being measured by adjusted gross income. Although neither cities nor counties can tax income, counties won’t be barred from using more progressive taxes related to discretionary income, taking the pressure off real estate taxes. Counties now are home to 70% of Virginia’s population. These residents carry an unfair load from over-reliance on the real estate tax. The State has added to that burden since 2008 by balancing Virginia needs an all-mail-in- ballot plan for the November Election By Stephen J. Farnsworth The deeply chaotic process of voting in Wisconsin on April 7 demonstrated how NOT to conduct an election in the midst of the Covid-19 crisis, warnings that should resonate in Richmond. Pretty much everything that could go wrong did go wrong with the process of voting in the Badger State. Government officials failed to send out requested absentee ballot promptly (which meant that many ballots could not be submitted by voters in time to be counted), election workers worried they might contract the virus stayed home and forced widespread closures of voting centers, and partisan legal wrangling in the courts kept the election process itself tentative until the last minute. After all this election eve mayhem, voters who were willing to risk their own health to cast a ballot in person faced extremely long lines in many communities, with wait times sometimes exceeding two hours. These entirely predictable process misfires in the midst of this pandemic undermined the legitimacy of elections, the central public process of democracy. Virginia is notWisconsin, of course. Even so, the Commonwealth should use the time between now and the November elections to create a system to ensure that voters here do not have the unappealing options faced by voters there. Virginians need to be able to cast a ballot on or before November 3 in a format that is both safe and legitimate, regardless of whether we are still battling the Covid-19 crisis or six months from now. Without a vaccine, which health experts say may be a year or more away, one cannot be certain the virus will be defeated by this fall. To state the obvious, Virginia already had shown signs of greater electoral maturity than Wisconsin. As the crisis intensified, Virginia officials declared that voters should use Covid-19 as excuse to obtain and cast a mail-in ballot for May local elections. During Virginia’s 2020 legislative session, lawmakers made it easier to vote, including the establishment of no-excuses-required early/absentee voting starting later this year. More needs to be done. Without further planning and budgeting over the spring and summer, Virginia election officials will be overwhelmed by any last-minute decision to convert to a universal vote by mail system. The abandonment of in-person voting this year may be necessary if health conditions this fall foreclose the opening of traditional polling stations. Ideally, Americans would have a national vote-by-mail infrastructure in place by November, but so far Washington officials have been divided over whether to plan for such a possibility. While the federal government recently authorized $400 million for voting improvements, that amount is far short of the estimated $2 billion cost of creating a national vote-by-mail system between now and November. President Trump recently criticized mail-in ballots as being at risk for fraud, even though he uses the mail-in voting process himself. its budget through relying more on local taxes and revenues for funding government services. It is time to allow counties to meet their funding challenges with options in tune with the economy of the 21st century. DelegateWatts is a Democrat representing part of Fairfax County. See Virginia needs an all-mail-in-ballot plan , continued on page 6 V