A town already notorious for its slow pace, Washington may be moving even slower soon, following the Virginia Department of Motor Vehicles’ ultimatum to ridesharing services Uber and Lyft last Thursday, demanding they cease operations. Arlington County cops are already on the lookout after DMV Commissioner Richard Holcomb announced that the two companies’ services “are not ridesharing arrangements as defined in Virginia law” exempt from regulation because their drivers receive payment.
While Washington yuppies are panicking about resorting to the Metro to cross the Potomac, one larger question lingers — is DC now a freer place to live than Virginia?
For years, Virginia has been the favored place of residence for limited-government lovers in the Beltway. While neither side of the river is exactly a libertarian paradise, the Commonwealth has long enjoyed lower taxes, regulations and gun laws than the District. However, it looks as if the pendulum is now swinging in the opposite direction, as Virginia’s attack on Uber is just the latest of multiple blows against responsible governance south of the Potomac.
Arlington County, for instance, has received an influx of criticism in recent months for prioritizing board members’ pet projects over more critical services like schools and infrastructure. 25 of the county’s 32 K-12 public schools are projected to be over attendance capacity by 2016. Residents complain of poor road conditions on major arteries like Columbia Pike. Yet, instead of prioritizing maintenance for these existing services, the Arlington County Board is dreaming up expensive new ones such as an $80 million aquatics center and $358 million street car.
One would expect the board to hesitate to buy shiny new toys after the harsh criticism they received last year for constructing a $1 million bus stop, fully equipped with computerized schedules and foot heaters. Despite the fact that the board had to cut future bus stops’ price tags down to a mere $469,000 each, that hasn’t stopped the new multimillion-dollar proposals. Unfortunately for its pork barrel ways, there may soon be a road bump on the path to indebtedness. Arlington residents elected the first non-Democrat in 25 years to the County Board last fall, John Vihstadt, on the platform of cutting wasteful spending.
Meanwhile across the river, the seat of the federal government is surprisingly giving its local residents a tax break. The DC City Council approved a tax reform package last month seemingly out of nowhere that includes two new lower personal income tax brackets. Effective 2017, DC residents earning between $40,001 and $60,000 will be taxed at a rate of 6.5 percent (compared to the current 8.5 percent), and individuals earning between $350,001 and $1 million will be taxed at a rate of 8.75 percent (compared to the current 8.95 percent).
As with any tax reform, there are trade-offs. To make up for the lost revenue, the city is slapping its 5.75 sales tax onto six service industries previously exempt, including health clubs and carwashes. However, this rate is still lower than Northern Virginia’s 6 percent rate as a result of former Gov. Bob McDonnell’s 2013 transportation plan (and Maryland’s for that matter, too).
Granted, Virginia still enjoys an edge over DC in many aspects of responsible governance. But at the rate it’s losing it, fiscally conservative Arlingtonians may not mind that Uber is gone… because they will be as well.