County Manager Mark Schwartz

Arlington County Manager Mark Schwartz speaks to County Board members.

County Manager Mark Schwartz is in the process of ripping up his previously proposed $1.4 billion fiscal 2021 Arlington spending plan to align it with a new economic reality.

But, Schwartz told County Board members on Feb. 21, there is no need to panic.

“We do have budget reserves available in significant amounts,” the county manager said.

That said, the impact of the COVID-19 pandemic on local-government priorities could be as broad-based as the aftershocks of the 9/11 terrorist attacks or the 2008 recession.

“It’s safe to say we don’t know [the eventual impact], but it’s going to be significant,” Schwartz said, telling board members he planned to come back with proposed budget revisions by April 1.

Reworking a budget on the fly would perhaps be a first for Arlington: The 2001 terrorist attacks occurred in September, before the budget-crafting process for the subsequent fiscal year had started, and the economic downturn of 2008 also gave some advance warning to those putting together spending plans.

The county manager in late February unveiled a package that would allocate $846 million to general government operations, up 2.7 percent from the current spending plan, and $550 million to schools, up 3.3 percent.

To do so, he proposed maintaining the real-estate tax rate at $1.026 per $100 assessed value, which due to assessment increases (which were updated in January) would cost the typical homeowner several hundred dollars more per year in taxes.

The County Board advertised the $1.026 rate, making it the maximum that could be imposed next year without going back and holding a new hearing and revoting to do so.

The March 21 discussion of coronavirus fallout occurred during a County Board meeting that went on despite the health crisis, which also has morphed into a global economic downturn and a degree of emotional frenzy. County Board Chairman Libby Garvey acknowledged members of the public – many of them cooped up at home – are antsy.

“People are anxious a little bit,” Garvey said. “This is a time we all need to pull together [with] patience and concern. Sometimes it’s a little bumpy.”

Schwartz’s budget proposal for the fiscal year beginning in July was crafted when the future looked bright. Unemployment across the county and region was rock-bottom, tourism spending was strong, restaurants were full and housing prices continued to rise. It’s likely the revised budget proposal will shift more emphasis to social-service spending and economic-development assistance.

“We don’t want to leave anyone unassisted,” Schwartz said.

Not everyone in the public, however, thinks simply moving numbers around on a spreadsheet will be good enough. One activist said the county government needs to scale back its efforts at promoting more density and urbanization.

“We are overstretched,” said Anne Bodine, speaking at the board’s public-comment period, saying that COVID-19 was simply adding to the stresses of a community that has grown too much, too fast.

(Bodine also put in a pitch for the county government to acquire a large residential tract at the corner of Wilson Boulevard and McKinley Road, one of the few parcels of its size still available in the county. The parcel, owned by the estate of the late developer Randy Rouse, is being marketed for sale.)

Even as they work to rejigger the operating budget, county officials also will have to determine a strategy for future capital spending, as an update to the government’s capital-improvement program (CIP) is in the works. Schwartz previously said he likely would call for a major bond referendum to support improvements to the county’s aging stormwater system; the school system also anticipates a bond package will be on the ballot in November.

One major fallout from the current situation, at least until things stabilize, could be the county government’s ability to go into the bond market to fund capital facilities already approved by voters. Traditionally the county government sells bonds in the late spring, but at the moment such a sale likely would be impossible even for a community with AAA bond ratings as Arlington has.

Capital projects currently under way – including schools, the Long Bridge Park aquatics center and Lubber Run Community Center – will be dependent on the ability to keep workers on the job, Schwartz said, and he predicted there was “absolutely no way” timetables for opening new facilities are likely to be met.

The psychological impact of a shutdown of daily life also is stressing the public; Schwartz said the county government would do what it could to help.

“We have a lot of creative ideas we’re working on before [county residents] go completely stir-crazy,” he said.

As of this writing, County Board members still plan to hold state-mandated public hearings on the budget on March 31 at 7 p.m. and on tax rates on April 2 at 7 p.m. But those are subject to change.

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