If County Board members in September decide to kill off Arlington tax decals that have been a fixture on local windshields for a half-century, the two elected officials who will be tasked with implementing the decision say they can make it happen.
The question that still hangs in the air, though, is whether eliminating the decal will make it more likely scofflaws will get away with cheating the tax man (and woman), or whether advances in technology truly make the 3-inch-by-3-inch appendage obsolete.
Arlington’s top tax collector may not come across as ecstatic about the proposed eradication – she has long been in the decals-serve-a-purpose camp – but appears willing to live with it.
“I will support whatever decision the County Board makes regarding the decal, because there are tax-collection systems in place in my office that will preserve the county’s famously low tax-delinquency rate,” Arlington treasurer Carla de la Pava told the Sun Gazette, with a touch of pride, after county staff this summer proposed eliminating the decal.
The little square sticker since the late 1960s has served as proof the personal-property taxes on vehicles in Arlington have been paid. County Board members are slated to hold a public hearing on Sept. 22 to eliminate the decals in 2019, which would make Arlington the latest jurisdiction to do away with them.
Fairfax County got rid of its decals in 2006 (a move criticized at the time by the Arlington treasurer’s office). Loudoun County recently became the latest Virginia locality to eliminate them, although both Alexandria and Falls Church are among localities that still see them as useful and continue to use them.
Arlington government staff say advances in enforcement technology make the decal unnecessary, a point of view shared at least in part by Commissioner of Revenue Ingrid Morroy, whose office is adding high-tech gadgetry to hunt down those who aren’t registering their vehicles in Arlington.
By using a new license-plate-reader system being rolled out by her office, “I believe that we will be able to increase taxpayers’ compliance,” Morroy said, predicting that her office will be able to double the number of vehicles it uncovers that should be registered (and paying taxes) but are not.
Using the license-plate-reader system “is less time-consuming” than under the current enforcement regime, where staff walk or drive through parking lots or garages to physically inspect vehicles, Morroy said.
“We will research those vehicles [flagged by the electronic system] as we have done with the manual system, and add vehicles to the tax rolls as warranted,” Morroy said.
Once the new plate-reader infrastructure is fully in place, compliance staff from the commissioner of revenue’s office will continue to focus on neighborhoods that have high numbers of out-of-compliance vehicles, based on phone calls and e-mails to the county tip lines that have been rolling in for the past decade and a half.
“As we have done during the past 15 years, data collected by my office are used strictly by this office for tax-assessment purposes, and are not shared with any other department, police or otherwise,” Morroy said.
The commissioner of revenue acknowledged that, while the tip lines will stay open, they might ultimately prove less effective because residents will only be able to report vehicles with out-of-state plates, but not those with Virginia tags but no sticker (since there will be no sticker).
And there will be other enforcement issues to surmount:
• Eliminating the decal also will take a tool away from law-enforcement personnel; in fiscal 2018, about 4,900 tickets were issued in Arlington for vehicles not displaying a decal.
• Elimination of the decal also will take away one tool from the treasurer’s office, which is responsible for collecting car-tax revenue. Under state law, the treasurer’s office can withhold issuing decals to those whose car-tax payments are delinquent.
According to de la Pava, the power to withhold decals is a relatively small stick compared to other tools in her office’s payment-compliance arsenal.
“Advances in technology have provided the treasurer’s office with increasingly efficient methods of enforcement,” she said. “Wage and bank liens, for example, are particularly effective, and we also rely on Virginia state-income-tax-refund withholding, Virginia DMV registration holds . . . and vehicle seizures. These tools tend to be far more efficient and effective.”
Use of varying tools has enabled the treasurer’s office to cut the delinquency rate for vehicle taxes by 56 percent over the past decade, although they still stand at about $1.8 million (low by historic norms but still above, say, the rate of delinquency on residential and commercial real estate).
Arlington first required decals to be placed adjacent to the state inspection sticker on windshields in 1967. For nearly 20 years before that, metal strips attached below the license plate had served a similar purpose.
The 2018-19 decals – likely the last – already are being distributed to those who are registering new vehicles. Most county residents will receive the new decals when they are mailed car-tax tax bills in coming weeks.
Vehicle owners in Arlington annually pay $5 per $100 assessed value in personal-property tax, minus the state rebate (100 percent tax relief on the first $3,000 of a vehicle’s value and 28 percent off the next $17,000) that has been in place in various forms since 1998. The rebate is for vehicles driven for personal use only.
The $5-per-$100 Arlington tax rate has been fixed for many years, and is unlikely to change upward or downward when the decal requirement is dropped. County staff have proposed retaining the $33 vehicle fee, which brings in about $5 million a year, even after the decals are eliminated.
Not every vehicle that is garaged in Arlington is required to be registered in Virginia; exemptions exist for some out-of-state students and military personnel, as well as for vehicles owned by the federal and state governments and those registered with the U.S. Department of State by foreign diplomats.
Those who wish to retain their out-of-state tags but do not qualify for exemptions can do so by paying the vehicle tax, decal fee and an extra $100 fee annually.