Monday, April 19, 2010

Arlington County's Misguided Kiddie Tax

One of the many hats the Curmudgeon wears these days is that of President of the Arlington Soccer Association. ASA serves more than 5000 kids in Arlington and Falls Church with various soccer programs and activities all year round, and is celebrating its 40th year of service to the community this year.

As President of ASA, the Curmudgeon has been spending quite a bit of time lately fighting against a youth sports player fee that is under consideration by the Arlington County Board. Bear with us here as we explain why this fee is unfair and bad policy. The County Board will decide the fate of the fee this Saturday. (If you want to reach them with your views, it's easy--you can email all five members at: )

The fee under consideration would be $8 per player per season starting with Fall 2010 sports. The fee was put forward by the Parks Dept. as part of its budget for the 2011 fiscal year. The Acting County Manager, however, did not include the fee in her proposed budget; instead, it was included as an optional "tier II" revenue item that the Board could adopt to add more money to the budget.

The rationale of the Parks Dept. for the fee was that it is necessary to implement a "cost-recovery" policy adopted last year by the County Board. That policy was adopted without the County Board ever having a public hearing on it, which is pretty unusual in Arlington.

The cost recovery policy itself, however, is pretty reasonable on its face. It says that the Parks Dept. should recover 65% of the direct costs of youth sports programs in the County. In other words, as a matter of policy, Arlington thinks youth sports are of sufficient importance to the community to merit up to a 35% taxpayer subsidy. So far, so good.

The problem is with how the Parks Dept. has interpreted the policy. Some youth sports programs, such as basketball, are run "in-house" by the Parks Dept. For those problems, the policy is pretty simple--figure out the cost of the program and then set fees so they will recover roughly 65% of the costs. (In fact, the Parks Dept. has set fees at a level where they recover nearly 100% of the costs of basketball; they now say they'll just let the fee stay the same for a few years until it gets closer to the 65% target.)

Other youth sports programs, such as soccer and baseball, are run by private, non-profit groups who are "affiliated" with the Parks Dept. through formal agreements. In those sports, the non-profit organization pays most of the direct costs of the program--referees, equipment, uniforms, administrative personnel, etc.--while the Parks Dept. provides facilities (fields, mainly) and pays the costs of maintaining those facilities and administering them.

In determining the cost recovery target for those affiliate programs, however, the Parks Dept, has completely ignored the direct costs paid by those programs, treating them as if they don't exist. Instead, the Parks Dept. has demanded that the affiliate programs cover 65% of the portion of their costs that are covered by the Parks Dept., using that as an excuse to propose the new player fee--assessed only against players in affiliate programs.

The Parks Dept. interpretation turns the cost recovery policy on its head. If all the costs of ASA's youth soccer program are added together, then the fees parents already pay--to ASA--for their children to participate cover roughly 80% of those costs, well above the 65% cost recovery target. But the Parks Dept. claims it gets 0% cost recovery for these programs because parents don't pay a separate fee to the Parks Dept.

Thus, a policy that was supposed to embody a strong community commitment to youth sports is used to REDUCE support for such programs and serve as the basis for a new tax on soccer and baseball parents.

The County Board could easily put a stop to this charade by stepping in and telling the Parks Dept. that is has misinterpreted the County's policy. But, hungry for revenue, at least some Board members have seemed to signal support for the new fee.

Mind you, if the fee is adopted, the money won't be used to enhance youth sports programs. To the contrary, it will go to restore budget reductions in other areas, such as tennis court lighting. This is a sore subject, because adults who play tennis in Arlington really do pay 0% of their costs--and that's the County's policy. (Likewise, users of the County's 8 dog parks--or "community canine areas"--pay no fees to use them either.)

In fact, the Parks Dept. has been reducing its support for affiliated youth sports over the past two years. First, it shifted field lining responsibilities to soccer and baseball. ASA didn't object to this given budget realities, but it did result in an additional $25,000/year expense for us--that's $5 per player. Then, in the current budget cycle, the Parks Dept. eliminated a stipend that had been used to cover insurance and other costs. Eliminating the stipend will cost ASA another $22,000/year--almost another $5 per player. Again, we did not object to this reduction, which amounted to 14% of the Parks Dept's costs associated with the youth soccer program. That's a big cut on top of the similar cut a year before--clearly ASA is feeling it's share of the budget pain.

At the same time, field maintenance has been reduced; new fees imposed for use of lights in the winter; higher fees extracted for summer camps we run. We understand this--times are tight and we have to do our share.

But adding a new fee just for players in affiliated youth sports is not fair. That's just a tax on those parents, with the money being used to fund other programs. We're not against the other programs, but the money for them should come from the County's general taxes, not a perverse tax on children's sports.

Some people in the Parks Dept., and in groups grubbing for the money, have argued that "it's only $8" as if it couldn't be that big a deal. But it's not "only $8." If you have three children, and they play the fall and spring seasons of soccer, and maybe a couple also play baseball or softball, it's more than $60. That's more than the average homeowner's tax increase based on the proposed new property tax rate.

And while some soccer parents--such as the Curmudgeon--could easily afford it, there's a lot of working class families that will find it quite a burden. Those are the families we don't want to lose. (The Parks Dept. says it won't impose the fee on families that qualify for financial aid, but our data show that many who would qualify don't apply, and there's concern about the paperwork burden.)

We hope sanity will prevail in the County Board this coming Saturday when it votes on the fee. A couple of Board members have indicated their opposition to it. We hope the rest will pay attention to the couple hundred emails they have received from soccer parents on this issue--just the tip of the iceberg. Surely Arlington County can achieve its budget goals without disproportionately penalizing children who play organized soccer on the County's fields.

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