In Arlington, a new data set reveals a rare year-over-year increase in the tax-delinquency rate. This uptick is closely tied to the rising cost of vehicles. County Treasurer Carla de la Pava emphasizes that many people fail to consider the annual tax implications of vehicle ownership. As a result, some are caught off guard when tax bills arrive in the summer and struggle to find the funds to pay before the early-October deadline.

Unraveling the Arlington Tax-Delinquency Puzzle

Vehicle Costs and Tax-Delinquency

The increasing cost of vehicles has emerged as a key driver in Arlington's tax-delinquency rate. Since the pandemic, the average price of a new vehicle has soared to over $48,000. During this time, the valuation of used cars, trucks, and SUVs also witnessed a significant growth due to the scarcity of new vehicles. This has put a strain on taxpayers, making it harder for them to meet their tax obligations.Arlington's tax rate for personal-use vehicles is $5 per $100 assessed value, with certain exceptions due to state-government rebates. For gas- and diesel-powered vehicles, there is no tax on the first $3,000 of assessed value and a 25% reduction on the next $17,000. For clean-fuel vehicles, the tax exemption is even more generous, with no tax on the first $3,000 and a 50% reduction on the next $17,000. These reductions were implemented through the 1997 election of Republican Jim Gilmore as governor on a promise of "No Car Tax." Although vehicle prices have risen, the state's $20,000 threshold for tax relief has remained unchanged for years. As a result, the average vehicle tax in Arlington is about $1,700 per year.

Real-Estate Tax Delinquency vs. Vehicle Tax Delinquency

While delinquencies on vehicle taxes are on the rise, the delinquency rate on real-estate taxes is at an all-time low. After the October 2023 deadline for real-estate and personal-property-tax payments, the total delinquency stood at $18 million. However, through a combination of incentives and enforcement measures, the treasurer's office was able to reduce this rate by 90% before the official year-end tally in August 2024. The treasurer's office employs various strategies to help taxpayers, including installment payments and the Taxpayer Assistance Program, which provides low-cost loans through a private lender.The treasurer's office also sends out about 620,000 email reminders annually and makes about 9,000 robocalls as the deadline approaches. Efforts are underway to expand these outreach efforts by adding text-messaging. Board Chair Libby Garvey recognizes the importance of these efforts, as sometimes people simply forget about their tax bills.Despite the recent spike in the tax-delinquency rate, the fiscal 2024 delinquency rate remains among the lowest on record. Reducing the rate has been a guiding principle for both de la Pava and her predecessor, Frank O'Leary. When O'Leary was first elected in 1983, the delinquency rate was about 8%, nearly 50 times higher than it is today.