Letter to the Editor, from David Dickinson, Loudoun County
Hoping to bolster economic development and pressured by developers, homeowners and special interest groups, our Board of Supervisors voted three years ago to accept a funding agreement to expand Metro’s Silver Line to Loudoun.[read_more]
Initially, the financing was reasonable. Metrorail Service Districts limited additional taxation to those landowners directly benefiting from Metro, low-interest TIFIA bonds provided construction funds while deferring payments for years, and the promise of future commercial development beckoned.
“Metro” is a euphemism encompassing an array of organizations. Two key organizations are the Metropolitan Washington Airports Authority (MWAA) and the Washington Metropolitan Area Transit Authority (WMATA). To oversimplify, MWAA builds the Silver Line and WMATA runs it once constructed.
But the silver lining is fading. The financial landscape of Metro and the benefits to Loudoun have considerably worsened.
Particularly alarming is MWAA’s attempt to develop its own property – something MWAA CEO Jack Potter promised our board would not happen – and cut Loudoun out. MWAA desires authority to build a “Dulles City” on federally-leased airport land, and they declared their intent to receive “unsolicited” proposals last month.
Loudoun’s problem is that airport-located commercial properties would mostly be exempt from local taxation. Such an arrangement would cripple Loudoun’s metro-oriented development efforts. What developer wouldn’t chose to build on tax-exempt airport land?
As predicted, WMATA drifts toward insolvency.
Their annual audit is months overdue. They have not for an entire year provided mandatory quarterly financial reports to the jurisdictions that subsidize it.
They have an unsustainable $500 million in short-term debt.
Moody’s again downgraded Metro bonds last month. WMATA funds its growing pension obligations with its operating budget, a dangerous fiscal behavior. An expenditure audit found Metro awarding millions in no-bid contracts and ignoring contracting rules. Senior officials quit or were forced out. The list goes on and on.
What can our board do? To start, don’t go wobbly on us. Don’t make a bad deal just to close the deal.
Our current board endeavored to expand commercial development but has had limited success. Commercial vacancy rates hover around 17.5 percent. The baseball stadium is engulfed in years of litigation hampering One Loudoun’s development. MWAA is stealing Loudoun’s commercial revenue stream. It’s time to play hardball, and not get desperate.
Loudoun and the other jurisdictions still hold the power of the purse. Loudoun must demand a contractually binding guarantee that MWAA will not even attempt to commercially develop airport property or Loudoun will nullify the funding agreement. If such tactics delay the project, so be it. Future commercial revenue flowing to Loudoun’s coffers is too important.
Upon reconsideration, Arlington recently canceled its multi-year public transportation trolley project after considerable expense. Maryland Gov. Larry Hogan threatens to delay or halt Purple Line expansion. MWAA and WMATA have seen their reputations publicly thrashed with financial and ethical lapses of biblical proportions. We have the upper hand. The board made a tough decision to enter into the funding agreement. It might have to make a tougher call to get out.