Tax Policy Hurts D.C.'s Local Businesses
A July 20 Metro article ["Feeling the Pinch of D.C.'s Prosperity; Small Businesses Cry Out for Relief From Rapid Rise in Property Taxes"] inadequately explained why tax assessments are rising for small commercial property owners in the District.
Regardless of buildings' location and use, the D.C. Office of Tax and Revenue values commercial buildings as if they could be converted into downtown office buildings. If the purpose is to turn the entire city over to office buildings and retail chains, then this property tax assessment methodology is working.
The market for downtown property is not local; it involves national and international developers, lenders, and portfolio investors. The market for small-footprint buildings in neighborhood commercial districts is local -- in terms of property owners, investors, tenants, sales potential and rents. The solution is simple: differentiated tax assessment methods.
The legislative focus on property tax abatements or tax caps fails to address this fact.
As a result, locally owned businesses will continue to close or relocate to the suburbs, while more and more of the retail identity and uniqueness of the District is lost and the city's retail landscape becomes reshaped into yet another mall, albeit outdoors, featuring national brands.
Citizens Planning Coalition