REFERENDUM

Question: Is there a need for the redevelopment and housing authority to be activated in the County of Arlinston?

When Arlington County voters go to the polls Nov. 2, they will face a ballot question that seems simple enough: Whether to creath a local housing authority.

Behind the seemingly simple question is a complex debate. On the one hand, proponents say a housing authority could be the catalyst to rehabilitate rental housing or help people buy their own homes, thus bringing much-needed help to low- and moderate-income residents. Opponents fear the proposal would open the door to a massive bureaucracy trying to bring public housing to the county.

The question is listed as "Referendum" on the November ballot and requires a simple majority for approval.

In the past few months, groups throughout the county have lined up on either side of the issue, with both sides vigorously arguing their positions.

The two candidates for the County Board have taken opposing views. Democratic candidate Mary Margaret Whipple was an early supporter of the plan. Her opponent, Republican-backed incumbent Stephen H. Detwiler, announced last week he opposes the plan.

Among others coming out for the proposal have been the Housing Advisory Commission, the Arlington Civic Federation and the League of Women Voters. Coming out against the proposal have been the Arlington Republican Committee, the Arlington Taxpayers Alliance and the county Landlord-Tenant Commission.

The heart of the debate centers over the powers a housing authority would have. Although state law outlines a broad range of powers, the County Board could limit those powers significantly.

One concern of opponents is that a housing authority would be used as a vehicle to create public housing, with the county as landlord. Proponents, however, say public housing is not on their agenda. The county has no public housing, and County Board members say they would not allow the authority to build such projects.

"The sole purpose of the redevelopment housing authority would be to establish a locally based financing agency that would provide below-market, interest-rate financing," said Dennis Hottell, cochairman of the Committee to Preserve Affordable Housing. "Under no circumstances will the authority be a landlord."

Opponents, however, are not so sure.

"I think they'll take advantage of every single authority they have within the laws," said Jack Torbet, president of the Arlington Taxpayers Alliance. "My major concern is that this agency, once it is established under Virginia law, answers to no one."

County officials point out that all members of the governing board of the authority -- which could range from five to nine, depending on a decision by the County Board -- would be appointed by the County Board and would answer to the board.

Since the state law providing for local housing authorities was enacted more than 40 years ago, 25 Virginia communities, including Alexandria and Fairfax County, have established such authorities.

Most officials agree that the scope and power of each authority depend heavily on the local governing body.

The powers and staff of a housing authority "depend on the characteristics and needs of a particular jurisdiction," said Deirdre Coyne, spokesman for the Fairfax County authority. Even in Fairfax, where the authority has about 100 employes, Coyne said county funds are required for only 10 percent of the workers, since federal funds are available.

What could an authority do? As described by state law, including a supplement approved during the last session of the General Assembly, it could:

* Lease, acquire or operate public housing projects, if granted that power by the local governing body.

* Investigate housing conditions and make recommendations.

* Invest funds it has in reserve or that are not needed for immediate payments, subject to certain limitations.

* Make loans or award grants for rehabilitation and construction in blighted areas and help private sponsors of projects through any money -- from public or private sources -- at its disposal.

* Act as the local agent to provide federal or local loans to low- and moderate-income families for housing rehabilitation.

Proponents see the housing authority as a way to help low- and moderate-income families find affordable housing, an increasingly scarce commodity in Arlington.

Even though various state and federal programs have provided some help in the past, county officials say funds for those programs are drying up. The result, according to some county officials, is that many families "fall through the cracks."

For the most part, those people are not the poor, said Melodee Bawden, program supervisor of the county's rent assistance and development office. Rather, Bawden said, they earn no more than 80 percent of the county's median income, "say, a family of three making $21,000 a year."

In Arlington, according to new U.S. census figures, about 9,400 households fall into that category.

Opponents say they are concerned that the housing authority would be an unneccesary drain on county resources.

For example, they voice concern about the cost of staffing such an authority. Although some proponents say two or three paid staff members would be adequate, others such as Taxpayers Alliance president Torbet foresee a nightmare of uncontrollable increases in staff and power. "It's just a creeping, creeping bigness of government that feeds on itself," Torbet said.

County officials say staffing would depending heavily on the scope of the authority, as defined by the County Board.

"Nobody in the county government has issued anything formal on how it would be staffed," said Bawden. "It'd be cheaper to staff it with county employes."

Another concern of opponents is the financing power of the authority. At the heart of the authority's revenue-raising function is the ability to sell tax-free housing bonds, often attractive to investors who are willing to forgo slightly higher returns on taxable bonds in exchange for income free of federal tax obligations.

The authority also could act as an intermediary, borrowing from a bank and passing the money on to a developer or nonprofit group, which would be obliged to repay the loan.

First, the authority would have to identify projects it wanted to assist. And Bawden said restraints set by state and federal laws on the uses of housing money, in addition to local zoning ordinances, would require County Board approval for nearly every project.

Repayment of the bonds would come from rents and any fees the authority receives.

However, Torbet and other opponents fear that if the authority were to default, the county bond rating would suffer. Legally, county officials say, the county could not be held responsible in the case of any defaults by the authority.

Although the County Board has not formally taken a stand on the issue, and is not expected to, board members have split along party lines over the issue, with Republican members generally opposing it and the Democrats favoring it.