Old Town Alexandria, like many southern cities, is graced by a number of shaded, nook-and-cranny gardens, green spots that break up the pattern of town-house facades and that are considered by preservationists to be an important element of the 18th-century cityscape.
Ironically, however, the beauty and desirability of Old Town could spell the demise of its gardens.
Land values there, particularly on large parcels in Old Town with excess space, have been rising steadily in recent years. Residents did not notice how rapidly, though, until the 1985 real estate assessments were issued last month and some families saw increases of 70 and 100 percent.
"Old Town land is probably the choicest, scarcest residential land in the state of Virginia," said David Chitlik, director of Alexandria's real estate assessment office. "Land values and the assessments, particularly in Old Town, reflect that."
Chitlik said that his office reassesses land values in each section of Alexandria every few years, and that Old Town's hadn't been raised for several years, resulting in substantial increases this year for many families.
"On the average 1,500-square-foot town-house lot in Old Town, the value of the land was probably assessed last year at $30,000 and this year at $40,000," said Chitlik. "For a 3,000-square-foot lot, however, the increases were higher. The land was valued, probably, at around $35,000 last year and might have gone up as high as $65,000 or $70,000 this year."
The real estate tax rate for Alexandria was $1.41 per $100 of value last year. The 1985 rate has not been set yet, but at last year's rate the increases in land values would mean tax hikes as high as $500 and $700 for some Old Town homeowners.
Local governments are required to assess the land and any improvements, such as a house, separately. Together, however, the package must be close to the fair market value. Chitlik said that because there are so few land sales in a highly developed area like Old Town it is difficult for the assessment officers to find comparable sales for measuring land values, the reason for the two- to three-year lag between increases in reassessments.
As a housing market, Old Town is one of the best in the area for the sale of high-quality units, and town-house developers are eager for sites in the established neighborhoods. As a result, preservationists are now concerned that if taxes on open land rise too much, Old Town's gardens may fall prey to development pressure.
Several already have, even without the tax pressure. Andrea Dimond, president of the Old Town Civic Association, said that the Young Men's Christian Association of Metropolitan Washington sold a historic house and garden at the corner of Cameron and St. Asaph streets to a commercial developer two years ago. The site is now occupied by a neo-colonial building that takes up the entire lot.
"Many of us feel it the quality of life is changing for the worse in downtown Alexandria," Morgan D. Delaney, president of the Historic Alexandria Foundation, wrote in the association's spring newsletter.
"Innumerable factors play into the perception . . . , of light, of space, of visual variety, not to mention beautiful, old buildings steeped in history. Many of these values unfortunately are disappearing before the onslaught of modern commercial values and the unbridled push for development that has occurred here over the past decade."
While a handful of the historic gardens are protected by easements donated to nonprofit organizations, such as the Virginia Historic Landmarks Commission, Dimond said there are at least six or seven important gardens that are not protected and many other small pieces of garden or green space that conceivably could be sold for development.
"One of the delightful features of Alexandria is the open areas and gardens," said historian William Seale. "But our historic preservation ordinance does nothing to protect them. The authority stops at the facade of the building."
Delaney said that his association is gearing up to launch a campaign to get owners of houses with historic gardens to donate easements that would preserve the gardens to local preservation groups.
"The problem with easements, however, is that the city assessors office has tended to say that protecting open space only makes your land more valuable rather than less," said Delaney. "Many of the owners of these gardens are staunch preservationists, but the city has put up a barrier to people who might otherwise be willing to donate an easement."
An easement was placed on the garden of the George William Fairfax House at 207 Prince St. 10 years ago, which lowered the value of the land by $100,000. The house is owned by Mrs. Charles B. Moore. Her nephew, Robert L. Montague III, an Alexandria lawyer who works with easements, said the Internal Revenue Service agreed at the time that the easement was worth that much.
"It was mostly a depreciation in the value of the land," said Montague. "The easement took away the right to subdivide the land, and since there was enough land for five town-house lots, that was quite a loss."
The assessment office maintains, however, that in many cases easements increase the value of the land.
"We have found that the market value of these big houses in Old Town is very high, largely because of the open space around them," said Chitlik. "They have an amenity, and that makes it more valuable."
Historic easements recently have come under attack from the IRS in many areas of the country, as federal officials claim that while people have the right to donate historic easements and deduct the loss of value resulting from encumbering their property, in many cases the loss is negligible.
Preservationists from across the United States are watching for the outcome of an IRS review of a house and garden easement on an estate in Savannah, Ga. A spokesman for the Historic Savannah Foundation said that the IRS originally ruled that the easement was of no value. The case currently is under review.
"There are some people who will argue that an easement only increases the value of the land, but we feel that is only true in the short run," said Polly Dean, director of the L'Enfant Trust in Washington. The trust holds facade easements for a number of historic buildings in Washington, and has been concerned that owners of historic properties will stop donating easements if the IRS continues to question easement deductions.
"People now are very aware of the value of historic buildings, but that hasn't always been true in the past and may not be true in the future," said Dean. "There may come a time when an easement on a garden could mean that the property would be very difficult to sell. In general, people don't like property tied up with restrictions."
Dean said that some local governments have clauses in their tax codes that allow the locality to lower assessments for property encumbered with easements.
Montague said that Virginia has such an ordinance and that in most cases property owners who have appealed their assessments have won some reduction as a result of the easements.