City Officials Discuss EFC & Gateway at Work Sesssion
By GEORGE BROMLEY
Falls Church Times Staff
October 20, 2010
The City Council and the Planning Commission discussed plans for the East Falls Church metro area (EFC) and the Gateway project at Monday night’s joint work session. The Council then held a separate session on financial and legislative issues.
City staffer Elizabeth Perry briefed the officials on Arlington’s ongoing EFC planning efforts. A draft of the County’s plan for the area is scheduled for release in February 2011.
Mayor Nader Baroukh cited three major concerns for the City: the design for the west entrance to the station on N. Washington St. (Lee Highway), the availability and access to parking, and the coordination of traffic flow around the site. The mayor stressed that Falls Church should continue its dialogue with Arlington, share its concerns, and start developing positions on the key issues.
The Gateway discussion followed on that of the previous joint session of October 5. City manager Wyatt Shields identified three significant areas for review: affordable housing opportunities, the fiscal impact of the project, and the extent of first floor retail.
Akridge has increased its cash offer to the City from $1.17 to $1.3 million, but has reduced the number of affordable dwelling units (ADUs) from 13 to 8. Based on yesterday’s discussion the City appears to be looking either for a mix of cash and units or straight cash. No consensus emerged, however officials recognized that it would be better to secure cash as early as possible, given the greater potential it would have in the current market. If the cash were received later in the course of development then an escalator clause would be necessary for the City to achieve equal value.
The ownership structure of the Gateway will affect its fiscal impact. Condominiums are preferred, but under the developer’s proffer it would retain the right to rent all units, including ADU’s, an arrangement similar to that now in place at Pearson Square (410 S. Maple Ave.). Tax revenue would thus vary from $535,000 to $690,000, exclusive of current receipts.
Mr. Shields said that some office building tenants might be unwilling to accept retail on the ground floor for security reasons, especially if they were to occupy the entire office space. However, all members of the Planning Commission felt that first floor retail was essential for the Gateway, given its proximity to EFC. The mayor and other Council members who spoke on the issue concurred. Two of the commissioners cited a need for visible surface parking, possibly along Gresham Place.
After the joint session the Council was briefed on the FY 2011 budget. Acting CFO Melissa Ryman reported that BJ’s, which has now opened, is expected to generate $330,000 in sales and cigarette tax revenue during the remaining nine months of the fiscal year. However, if the tax rate were held at the current $1.24 for the full year, there would be a potential shortfall of $1.4 million. The current year end projected fund balance would be $4 million.
Councilwoman Johannah Barry stated that later billings will reflect a tax rate several cents higher than the current one and that this had not been made clear to Falls Church residents by the previous Council. However, Mayor Baroukh said that a graduated approach to the rate had been the proper way to proceed last spring and that the potential for another increase was built into the budget, though no firm figure could be set at this time. Mr. Shields said that the City would not know until November if it would be necessary to increase the rate.
The Council quickly reviewed Falls Church’s legislative program for the 2011 General Assembly session. The City’s three priority positions are dangerous weapons in City facilities, non-discrimination based on sexual orientation, and photo red traffic signal monitoring systems. All likely will face an uphill fight in Richmond.
The session concluded with a review of the Council’s various work plans for the current term.
Councilmen Dave Snyder and Ron Peppe were away Monday evening, as was commissioner J. Robert Meeks. Next Monday’s Council meeting probably will be limited to a work session as not enough members will be present for a quorum.
By George Bromley
October 20, 2010
Falls Church in the News
There is a little throw-away here about the City being projected to end the year $1.4 million in the hole. That’s about five cents on the tax rate to make up the difference, isn’t it?
I noticed that little ditty too…I attended a Town Hall meeting and many of the budget work sessions…..never heard this referenced.
All that was said is given the expected decline in assessments (3 – 4.5%) and the assumption of a 3% increase in line item RPT revenue for the second half of the year, if the Council does nothing (ie keeps the tax rate at $1.24) there would be a shortfall of $1 – $1.4M. BTW, since this is half a year (May 2011 billing), the high end of the mathematical calculation is 10¢ not 5¢.
As the Mayor correctly pointed out, this 3% assumption was discussed and debated at length, and it was implicitly endorsed by the approval of the budget even though many of us had issues with it.
The decline in assessments may change the distribution of taxes among taxpayers, but increasing the rate to keep the line item revenue the same should not be a controversial issue, and reporting this issue (by the City, not FCT) as if it creates a “gap” is misleading.
Dan:
Thanks for the clarification. I do recall some discussion about how RE taxes would have to go up again in the spring in order to balance the budget. I’m working on how a 3% decline in assessments equals an 8% increase in the tax rate, but I am guessing it has to do with that whole fiscal year/calendar year thing we talk about every year.
The 3% revenue assumption would mean 4¢, while the 3-4.5% assessment decline would mean 4-6¢ in addition, for a total of 8-10¢.
The Gateway plans show a rental office which indicates that the residential buildings will be apartments, One bedroom ( 35×20) = 700 sq ft. and two bedroom = 1,000 sq feet. The Builder is negotiating and offering proffers to the City and Planning Department for a reduction in parking spaces, assumming that the nearby residential streets can provide needed parking spaces.
How will this affect the Real Estate assessments of nearby properties?
The City needs money for the budget…. and builders are offering proffers. I would like to know what is negotiated.
As noted, there is an offered proffer for a reduction in Affordable Units. Will this money go into the general budget? or into the Affordable Housing account?
Why is city getting involved w/another affordable housing project? It does not work. And, certainly does not bring in revenues for the city; i.e., reduce tax rate for citizens. Where do you think taxpayers are suppose to get the money from to cover suggested increase in tax rate?? Need to look into that general fund and give monies back to the taxpayer versus increasing taxes.
Commercial real estate is crashing. The single-family homeowner is being assessed huge tax increases on steady property values to make up for it. The one or two cents of this year’s tax increase that was ‘earmarked’ for the affordable housing project has been swallowed up to make up for unplanned losses elsewhere. And we already have affordable housing in the city.
Just to be clear the Gateway is not an affordable housing project. The city asks that new residential projects include affordable units. There are affordable units in the Spectrum, Pearson, etc. Some developers ask to proffer cash or a mix in lieu of units. That money would have to go to an affordable housing fund not the general fund.
At this point, there have been several worksessions on the project providing updates, but no formal staff report on the merits/issues. After the project has first reading, the Planning Commission will tackle issues like parking, landscaping, and design. If it can’t be parked as presented there will be negotiations.
Why are we even considering allowing more rental units? How is this in the City’s best interest? Is the new residence and shops next to the Econo Lodge and Cote d’ Or condominiums or rentals?
The newest building on Westmoreland (Arlington county) next to the Econo Lodge is “The Cresent,” an apartment building. Most of the 230 units are 1200 sq feet and there are 6 ADU units. The builder also gave a monetary contribution to Arlington’s affordable Housing Corp. The Cresent builders followed Arlington code for resident & commercial parking spaces.
Just west of the Gateway proposal is the planned Northgate (FCC) with a proposed 105 apartments. I don’t know how many affordable units or the special exceptions negotiated.
The East Falls Church Metro redevelopment plan calls for high rise multi-functional buildings. With the economy the way it is now, apartments are an easier investment for builders. This corner of Falls Church will soon be urbanized!
Melissa, I get it. My bad to state ahp; realize only part of Gateway project. As you note, units already available in city but does the taxpayer need to be part of another development which really benefits the developer. Monies should go to general fund and whenever funds needed submit a request. Why keep in separate pot, when per above comment “earmarked” taxes have been swallowed up for unplanned losses elsewhere. And, why sign on for rentals – no benefit/revenue to city/taxpayer.
Who qualifies for these units – city/school employees, residents, business owners, graduates of George Mason? Even affordable housing in Spectrum, etc., must be quite pricey.
Perhaps, mayor and city council need to take a look at city being associated w/another development involving affordable housing at this time and not ask to include AFUs.
JG – Not sure how you feel the city is involved with the Gateway in terms of direct money for the general fund. Akridge owns the property and has asked for a Special Exception to develop the property. The city staff, council, PC and other boards/commissions will review the application to see if it has value (revenue, planning, community). Any direct money coming from the development would come from proffers. Proffers go to specific needs/goals like a traffic light, undergrounding utilities, affordable housing, etc.
The value to the general fund will come from construction fees and tax revenue. The current property provides us very little tax revenue. After first reading, data will be provided on the “value” of this project (costs versus revenue) and it will be part of the decision process. The value of apartments vs. condos will also be debated. Based on the public work sessions, the developer wants flexibility on the decision based on the market. I believe Akridge would prefer condos themselves. Either way the proposed units are very small compared to the Westlee, Crescent and proposed Northgate. It would target a different market segment.
The qualification for the units will be worked out with input from the city staff on current needs. If we go the cash route, the money would most likely be used to help qualified people purchase homes. See the recorded work session from 10/18 for more detail: http://fallschurch-va.granicus.com/MediaPlayer.php?view_id=2&clip_id=193. Pam Doran gave a good overview of the staff point of view on how the money would be used and who would qualify.