Revised assessments of railroad property in Alexandria and Arlington released by the state of Virginia yesterday only slightly decreased the revenue losses the two localities will experience this year as a result of an unexpected change in the method of appraising railroad real estate.
David E. Jordan, railroad appraiser for Virginia' taxation department, said recent reassessments requested by officials of the two jurisdictions will increase Alexandria's tax revenue from railroad property by about $92,000 and Arlington's by about $82,500 this year.
The effect is to decrease the previously expected revenue losses in Alexandria from almost $990,000 in railroad taxes to about $896,000. In Arlington, the loss will fall from $310,000 to $227,500.
"That's about what we predicted," said Alexandria assessor David Chitlik. "It doesn't really alter the pain of the lost revenue."
"It's an improvement, but it's certainly not exactly what we wanted," added Arlington assessor James R. Vinson.
The state, over the past six weeks, reassessed the almost 740 acres of railroad property in the two jurisdictions following a political uproar over changes in the state's assessment methods that led to significant revenue cuts in Arlington and Alexandria. The two jurisdictions absorbed nearly $1.3 million of $2 million in railroad tax cuts statewide.
Until last January, the State Corporation Commission appraised all railroad property on a fair market value known as the "over-the-fence" method that compared it with nearby privately owned and locally assessed land.
But assessment authority was switched then from the SCC to the state's department of taxation (DOT), which changed the appraisal methods. DOT divided property according to whether it was actually used for operating or non-operating purposes and then applied difference formulas to determine the land's value.
Non-operating property is still assessed at fair market value. But operating land is now assessed under the "unit" method, a complicated formula that has the effect of equalizing the value of railroad property throughout the state. The new unit method, used by 38 other states, prompted an uproar in urban areas such as Arlington and Alexandria, where officials argued that an acre of railroad operating property was worth much more than an acre in a rural area.
DOT's Jordan said the revenue changes for Arlington and Alexandria were the result of transferring some land from the lower-taxed operating category to the higher-taxed non-operating one. Some parcels of land were also given higher values, he said.