Fairfax County outlines tax options for Tysons Corner road projects

Above, from a parking garage at Tysons Corner, a view of the construction around the Beltway and Route 123, near the tree line. Drivers on the Chain Bridge, left, will probably get their third lane back in February. (Richard A. Lipski/The Washington Post)
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By Kafia A. Hosh
Washington Post Staff Writer
Saturday, May 8, 2010

A mix of financing options, including tax increases, are needed to pay for road upgrades as Tysons Corner transforms into a city, according to a Fairfax County report.

Although the future of Tysons is transit-oriented via Metro's Silver Line, county transportation officials say road improvements are essential to increasing mobility within the congested business district.

The report, released Thursday, says Tysons needs an estimated $646 million in transportation improvements to accommodate growth over the next 20 years. To pay for those upgrades, county officials have outlined a financing plan that calls for the public to fund 67.5 percent of the cost, and the private sector 32.5 percent.

"It's a mix of public responsibility and private responsibility," said Walter L. Alcorn, chairman of the Fairfax Planning Commission's Tysons committee. "I don't think it would be fair to burden either one with this."

The public share is higher because it's based on the proportion of through-traffic in Tysons, which is 35 percent of the total, and half of the locally generated traffic, which is 32.5 percent.

Financing options include new levies, such as a countywide 4 percent meals tax or a special tax on non-residential landowners in Tysons. Officials are also considering tax-increment financing, in which a portion of future tax revenue from redeveloped properties would be set aside for road upgrades.

Other options are a general obligation bond and redirecting current tax revenue to Tysons, such as a portion of the property or commercial and industrial taxes.

Some of the funding sources would need additional approval. A meals tax and a bond would require voter approval and a special tax would require a petition from 51 percent of landowners.

State and federal funding is another possibility, but its availability is unclear. Fairfax receives between $40 million and $50 million annually from grants and earmarks, but "even if you allocated a fair share to Tysons of this, it still isn't a whole lot of money to put toward it," said Kathy Ichter, Fairfax's transportation director.

County officials said a mix of funding options would most likely be used. It's uncertain which option landowners would support. They already pay a tax to fund the county's share of the $5.2 billion Metrorail extension to Dulles International Airport.

Keith Turner, a senior vice president of WestGroup, Tysons' largest landowner, said developers would need to evaluate how tax increases would affect the financial viability of their projects.

"What do they [taxes] do to the risk returns of a project? You hit that threshold and obviously you get a problem," he said.

The financing plan highlights residents' concerns that growth in Tysons could cripple the road network. Rob Jackson, president of the McLean Citizens Association, said he welcomes a financing plan for new roads, and would like to see the tax burden shifted to the landowners who will benefit from an increase in density around the rail stations.

"They're going to be able to collect some good rents, build big buildings," he said. "They're the biggest beneficiaries."

The improvements would consist of 14 road projects needed to support 84 million square feet of development, almost double the size of Tysons Corner today.

County officials estimate that an additional $444 million is needed to build a street grid, which they expect landowners will pay for as they redevelop their properties. The public sector would pay the $347 million tab for an expanded bus service.

That brings the total cost of road and transit improvements, excluding the rail system, to an estimated $1.5 billion through 2030.

The Board of Supervisors has the authority to raise taxes or choose from the funding options. For now, supervisors are preparing to make a decision on the blueprint for redeveloping Tysons. The board is scheduled to hold a public hearing on June 22 and is expected to adopt a plan in late summer.

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