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Article History WASHINGTON (Map, News) - The Virginia Supreme Court ruling wiping out $300 million in transportation taxes threatens to jeopardize hundreds of fees raising revenue for parks, sewers and economic development districts.
“The decision casts a giant shadow on those types of entities,” Arlington County Attorney Steve MacIsaac said.
Northern Virginia Transportation Authority leaders on Thursday considered asking the state’s high court to reconsider the decision over concern for other boards, but decided the potential problems were not theirs to raise.
“I think the Supreme Court ruling could be interpreted in a fairly sweeping way that could be injurious to services for citizens throughout the commonwealth,” Fairfax County Chairman Gerry Connolly said. “There is a fear that this ruling was not drawn as narrowly as it could, or perhaps, should have been.”
Loudoun County Chairman Scott York disagreed, saying that fees directly corresponding to a service, such as park fees paying for park upkeep or sewer fees for new pipes, would withstand a legal challenge.
“These boards are using fees to someone receiving that service for capital improvements to the services, which is entirely different,” York said.
Analysts said the court’s ruling does not directly address the issue, leaving it somewhat unclear.
The ruling could result in future litigation or opinions from the Virginia attorney general to clarify the fee-levying power of government authorities, said John Dinan, a Wake Forest University professor who wrote a book about Virginia’s constitution.
“Could you read this and say it doesn’t apply to park authorities or others setting fees? No, you couldn’t say that,” Dinan said.
However, Joseph Henchman, a counsel with the Washington-based Tax Foundation, said fees that pay for directly related services would not be affected by the decision.
“As long as the revenue is going solely to the services that are underneath them, it’s constitutional,” Henchman said.
dgenz@dcexaminer.com
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Comments from Examiner Readers
8:15 AM MST on Wed., Jun. 11, 2008 re: "NVTA needs tax increases, fees from assembly to keep running"
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8:00 PM MST on Thu., Mar. 13, 2008
re: "Tax verdict may threaten park and sewer fees"
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9:55 AM MST on Thu., Mar. 6, 2008
re: "Arlington transit projects to suffer under court ruling"
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8:59 AM MST on Wed., Mar. 5, 2008
re: "NVTA preparing refunds for unconstitutional taxes"
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10:50 AM MST on Tue., Mar. 4, 2008
re: "NVTA struggles to stop tax collections"
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8:47 AM MST on Tue., Mar. 4, 2008
re: "NVTA struggles to stop tax collections"
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11:37 AM MST on Fri., Feb. 15, 2008
re: "Transit agency tax projections to drop dramatically"
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7:47 AM MST on Thu., Jan. 10, 2008
re: "Transportation projects on tap for region"
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3:30 PM MST on Wed., Jan. 9, 2008
re: "Va. justices question NVTA power to tax"
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7:29 AM MST on Wed., Jan. 9, 2008
re: "Va. justices question NVTA power to tax"
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5:28 AM MST on Tue., Jan. 8, 2008
re: "Va. attorney general backs transportation bill"
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6:43 AM MST on Fri., Nov. 30, 2007
re: "N.Va’s ability to collect taxes for transit projects on trial"
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7:31 AM MST on Tue., Aug. 28, 2007
re: "N.Va’s ability to collect taxes for transit projects on trial"
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7:08 AM MST on Tue., Aug. 28, 2007
re: "N.Va’s ability to collect taxes for transit projects on trial"
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7:07 AM MST on Thu., Jul. 12, 2007
re: "Va. attorney general backs transportation bill"
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6:39 AM MST on Thu., Jul. 12, 2007
re: "Va. attorney general backs transportation bill"
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7:00 AM MST on Wed., Jul. 11, 2007
re: "Fee for vehicle repairs facing opposition from local authority"
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Northern Virginia Dummies! said:
If you like higher taxes, vote for Gerald Connolly for Congress, 11th District. He loves higher taxes. So does Obama. You ain't seen noth'in yet!
Vote on this comment: I agree or I disagree
Examiner Reader said:
they also said the civil fees on driveing was going to be repealed to and the money collected paid back its already been passed to be repealed said it would be as soon as the gov sighns it that was 3 weeks ago and its still not been sighned i think the people that have paid money out on those stupid fines should sue for interest on the money as well if the gov is gone drag his feet and not sighn it to hold your money longer,they should have to pay the people interest.
12 agree | 1 disagree
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Abolish the NVTA said:
The situation demonstrates a complete failure to plan, effectively manage and account for some fairly simple issues. If the NVTA can’t handle the basics, how do we reasonably expect them to handle the terribly complex issues associated with Northern Virginia transportation? Fairfax County has already attempted to divert some $30 million of the NVTA funds to help balance their existing transit budget. How can we trust that future funds will be used as intended? The NVTA has failed in its mission. It has had its taxation powers invalidated as unconstitutional; and has been discredited with the public. It’s time to put this flawed, anti-democratic, unelected body to rest and move onto better solutions. Hopefully, our elected leaders will face these issues head on, learn from the failure of last year’s transportation bill and take the time needed to create reasonable, bi-partisan, cost-effective, long-term solutions without doing more end runs around the voters.
7 agree | 4 disagree
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GMU92 said:
So now people have to go scrounging around for a car rental receipt that was probably tossed out weeks ago? And why do people have to present receipts for taxes paid on car purchases and registrations?...the state already has that data, it is their job to fix the mess. I still can't believe that they actually started collecting the taxes BEFORE the Virginia Supreme Court ruled on the matter. The ineptitude in this state is mind boggling.
8 agree | 3 disagree
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SomeITguy said:
Got to love this one. The NVTA told people they were going to keep collecting while the court decided becauise they thought it was going to be upheld. Now they have no backout plan. I plan to sue for the interest on my money as well as the refund. They could have NOT collected the tax until the court announced it's decision and they would not be in this position.
23 agree | 21 disagree
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Chambek said:
Never met a politician that didn't need more taxpayers money and less taxpayer interfearance. Snail mailing out instructions to stop collecting an illegal tax is faster than email? Yea - got it. Vote !
25 agree | 24 disagree
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Examiner Reader said:
Because of these taxes imposed, I believe illegally, I will never sell my house (will rent instead) nor will I ever buy a new car in VA. I also use a mechanic shop in another state. Many of the slow times are slower on purpose! If a person sells because they can no longer afford to live here or to downsize due to a fixed income - VA will take even more $ of their lowered bottem line. There were double digit tax increases for a decade due to housing assessment increases - taxes have not come down - they went WAY up & are still there. VA Gov is just not getting EVEN MORE $ over the previous yr - so they make up new taxes in the guise of fees!! That's how the VA St. leg. supports their own downtrodden.
53 agree | 50 disagree
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Examiner Reader said:
Are the home owner sellers the only ones who travel in Virginia Roads, that they have to be the ones to pay this abussive penalty? and that on top of loosing lots of money in the actual real state market, and furthermore on money assessed but not received since the real market price is lower than the assessed value that milks also to the homeowners? An angered selling home owner
78 agree | 65 disagree
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Reid Greenmun said:
HB 3202 is a cancer upon our Republic and must be abolished. HB 320 stands up all-appointed regional taxing authorities that citizen have no control over. Our state requires a regional referendum to ask the citizens if they desire to stand up a regional government. HB 3202 and other such bills seek a backdoor to avoid the effort required to earn the support of voters at the ballot box. The regional taxing authorities created by HB 3202 are a dishonest attempt to create taxation without representation.
88 agree | 91 disagree
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terelli said:
Will this tax, which affects real estate transactions, help or hurt the current housing marketplace? Sellers (and those buying from builders) will have to pay 5x more than "usual"....which, in my situation, makes a 500 dollar tax go to 2500 dollars.
91 agree | 89 disagree
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Loudoun Tea Party said:
County Resident has it all wrong. While I agree that the way the state devides up the taxes is unfair to NoVa, what is to stop them from giving us LESS now that we are taxing ourselves? Now we will pay for the roads in NoVa with the local tax and the roads in the the rest of VA with our income and gas taxes. Mark my words, Richmond will send NoVa LESS money now and they will justify it by saying that we have another revenue source.
75 agree | 75 disagree
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Examiner Reader said:
What is the tipping point? All the taxes and fees, federal and state, county and city, for every thing imaginable. I give up, trying to be a working stiff and have a nice little house. Might as well live like in Russia. I pretend to work, and the government pretends to pay.
110 agree | 103 disagree
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Examiner Reader said:
If non-elected government officials can raise/levy taxes, how can the public exercise it rightful recourse ? With elected politicians we at lease have the opportunity to vote them out, but with appointed officials, we are stuck with them for life.
184 agree | 178 disagree
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Masonman said:
That's all we need, another layer of government to pick our pockets. Not sure about the rest of you but my family pays more than our fair share of taxes. The answer here is to better spend the money collected. Focus on the real issues, don't try to all things to all people.
169 agree | 176 disagree
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County Resident said:
WFY - You are absolutely correct, but the alternative pushed by Kaine and the Taxocrats was to raise state taxes higher and send even more money to Richmond for distribution elsewhere. Any statewide tax increase is unfair to NoVA residents. If we need more tax dollars, raise them locally and spend them locally.
227 agree | 169 disagree
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WFY said:
How delightful, we get the privilege of taxing ourselves more even though we get back much less than we send to Richmond. I'm tired of subsidizing the rest of the commonwealth.
192 agree | 174 disagree
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Examiner Reader said:
Aren't taxes already high enough? I recently moved to the area, and know that Loudoun county will already charge $4600 per year on my property, and that I will be liable for approx. $2500 in transfer tax already. More taxes imposed on property sales will hurt the number of sales as people will hold onto property longer to outrun the cost of this newly proposed tax, thus harming the already struggling housing market. I agree with this article, too, that anyone with half a brain cell will simply drive to a neighboring county in order to get services at a reduced rate. By imposing taxes on services, you will simply push those providing those services in the affected counties out fo business as customers move outside of the counties affected. Instead of levying new taxes, let's take a look at how the money is currently being spent, especially with an audit of cost overruns on current projects and overhead that is going nowhere (or into someone's pocket) instead of into our road
208 agree | 176 disagree
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