Unfortunately, rent control and stabilization programs found in other U.S. states are prohibited in Virginia. They are not enabled by the Code of Virginia for use by local governments like Arlington County.
In spring 2020, the County discontinued the Multifamily Rehabilitation Partial Property Tax Exemption program. This program allowed eligible multifamily properties to receive an exemption on the increase in assessed value due to rehabilitation or renovation for a 15-year period that included a 20% step-down applied for each of the last five years. The program was discontinued due to a lack of clear public benefit in exchange for the exemption and a lack of evidence to demonstrate that the exemption created an incentive for investing in property improvements. The program’s discontinuance enables the County to recoup an estimated $46M in cumulative forgone tax revenue beginning in CY 2022 through 2036.
The County has a long track record of preserving market-rate affordable housing units (MARKs) through acquisition. As part of Housing Arlington’s Financial Tools initiative, the County will continue to financially support the acquisition of multifamily properties with MARKs to preserve long-term housing affordability for Arlingtonians who make 80% or less of the Area Median Income (AMI). Such acquisitions will result in the MARKs being added to the County’s supply of Committed Affordable Units (CAFs), with the potential for redevelopment in some instances to increase the number of CAFs beyond the existing number of MARKs on site.
Not all MARKs properties, however, will be available for acquisition. Furthermore, the County’s resources for financing acquisitions are limited. Therefore, existing property owners need options to continue providing market-rate affordable housing. The 2017 MARKs report recommended that in addition to pursuing acquisitions when opportunities arise, new GLUP and zoning tools should be developed to provide a streamlined development review process and offer more density than currently possible in order to maintain some affordability. The Multifamily Reinvestment Study is executing that recommendation and exploring new zoning tools.