The Loudoun County Board of Supervisors has opened the door to a financing method that will make it easier for landowners and developers to pay for new roads and water lines.
On Tuesday, the board unanimously approved amending the county's fiscal policy to allow for community development authorities, or CDAs.
These groups, authorized by a 1993 state law, are empowered by counties to issue bonds to meet infrastructure costs within a development project.
The debt is paid off through an annual tax or assessment on business owners in the resulting development.
One CDA has been created in Loudoun: the Dulles Town Center CDA, set up in 1997. But the county's fiscal policy did not explicitly address the financing mechanism. Nor did it set a limit on how much such groups can borrow -- part of what financial advisers call overlapping debt. Advisers urged the county to settle both matters.
Although the CDA amendment passed easily Tuesday, the question of a limit on overlapping debt divided the board. Supervisors voted 6 to 3 to set it at 1 percent of the total assessed value of taxable property in the county. For the current fiscal year, that limit equals $519 million, county officials say.
Board Chairman Scott K. York (I) and Supervisors James G. Burton (I-Blue Ridge) and Sarah R. "Sally" Kurtz (D-Catoctin) voted against that figure.
Burton said Friday that 1 percent was too much and that he pushed a limit of 0.75 percent -- about $375 million this fiscal year.
"That's a reasonable start if we're going to go down that road," Burton said.
Vice Chairman Bruce E. Tulloch (R-Potomac) said the higher amount ensures that the board will not need "to go back to have the debate every year. We wanted to make sure we had enough capacity for future projects." All six Republican supervisors voted in favor of the 1 percent limit.
Long an obscure, complicated topic, CDAs have swiftly become an important political issue in Loudoun. Although questions remain about the county's liability in the event of a default, some supervisors see CDAs as a way to get roads built quickly, easing the county's transportation problems.
What really launched the significance of CDAs, though, was the suggestion by developer Greenvest LC of using them in an already-controversial residential development.
Greenvest's proposal to build 15,000 homes in Dulles South, the largest development in county history, includes $510 million in infrastructure costs that CDAs could finance. That has led some to conclude that the project drove Tuesday's vote.
Tulloch strongly disagreed. "This didn't reach 50 percent of their needs. This doesn't come close to financing their vision," he said Friday.
Greenvest, Tulloch said, sought a debt limit of 1.25 percent, just for CDAs -- a request that would create nearly $850 million in overlapping debt, on top of $925 million in tax-supported debt.
"No CDA has ever been approved of that magnitude," Burton said. "And the last thing this county needs is encouragement of residential development."
Also on Tuesday, the board unanimously approved pursuing a purchase of the county's cable TV system. Adelphia Communications Corp. operates the county's cable system, providing service to about 22,000 customers and grossing $20 million a year.
Adelphia wants to transfer the system to Comcast Corp. That effort by Adelphia activates a clause in the county code that gives the government the option to buy the system itself.
County officials say the board's vote may strengthen Loudoun's negotiating stance with Adelphia, particularly in improving service.
Separately, the board extended its franchise agreement with Adelphia for 90 days. The current agreement was set to expire Nov. 14.