By James C. Sherlock

I think that we don’t yet realize the full impact of the revolution being wrought by the telecommuting that accelerated during COVID.

Virginia Railway Express Route Map

I am sure I don’t.  But Virginians, and our state and local governments, must try to figure it out.

We are moving towards a world in which white collar workers will be increasingly exempt from commutes.

We have already seen during COVID the leading edge of the migration of workers and their families away from many of America’s cities, especially those with increasing crime, closed businesses and otherwise lowered quality of life.

Look at New York City.  I visited it a couple of months ago.  Many places I used to enjoy have become an urban wasteland.  D.C. is not far behind.

Virginia urban areas and some of our suburbs have experienced COVID-related business failures and are threatened with more that result from the lifestyle changes that COVID brought.

The attractions in these places are not directly related to employment, but rather to population density. Restaurants, night life and the arts were exposed by COVID as vulnerable.  Some people got out of the habit of centering their social lives on them.

The costs of cities and suburbs, especially housing, are less and less affordable.  Prices have continued to increase in the face of fast-rising mortgage rates (Note 1).  This cannot continue, so it will not.

Other Virginia locations that offer attractive lifestyles, lower costs of living and the communications infrastructure to support telecommuting with bandwidth and speed at scale can expect to see in-migration and its economic benefits if they both prepare for and solicit them.

The knock-on effects may prove far-reaching.  I will offer a few of them for consideration.  Virginia state and local governments will either plan to accommodate them or be run over by effects which, planned for or not, they cannot control.

Business Cost Reductions.  The telecommuting trend should drive down the relative infrastructure and labor costs of both government and private white collar organizations, including the headquarters of blue collar businesses.

Telecommuting has already driven down the relative costs of white collar productivity in some industries in the United States.

Tech sector management, design and development famously have not only allowed telecommuting, but encouraged it.  Some organizations have even successfully cut compensation for employees who take advantage of telecommuting to live in less expensive locations.

That is the tip of the iceburg.

The new expectations of reduced requirements for office infrastructure are starting to be built in to corporate business planning.  But I suspect that has not yet happened to the same degree in government planning.

Employee effects. The relative compensation of telecommuting employees and the costs of the buildings that host them should either decrease or at least increase less quickly that previously anticipated.  The next rent contracts for state and local government buildings should be negotiated from positions of buyer strength.

Employee expenses can decrease dramatically.  How much of your own or your kids’ familys’ salaries were or are spent on the costs (child care, clothing, transportation, time, expensive real estate) of leaving home to go to work each day?

Many people who have chosen to live in cities to decrease their commutes will lose that incentive.

The definition of essential employee has changed.  Why do some senior managers need to be in the office if their employees are not and the internet connections are stable and of sufficient speed to support real-time consultation?

At the other end of the spectrum of change, blue collar and medical workers will not be exempt from going to their jobs.   Remember the debates over minimum wages?  Not so much of that any more.  The compensation of blue collar workers and nurses has already exploded and will continue to go up more quickly than previously anticipated.

Transportation.  Telecommuting will change the very nature of cities and of travel. What will be the impacts of reduced commutes and business travel on our transportation system? On transportation taxes expended and collected?

What about the requirements for urban transportation?  For light rail to and from the suburbs?

The history of government transportation planning is not a reason for hope.

Virginia Railway Express (VRE) is a joint project of the Northern Virginia Transportation Commission (NVTC) and the Potomac and Rappahannock Transportation Commission.   NVTC is charged with the Northern Virginia funding and stewardship of the Washington Metropolitan Area Transit Agency (WMATA) and the Virginia Railway Express (VRE), which it co-owns.  It manages state and regional funding for six bus systems, Metrorail and VRE.

Governor Northam in March of 2021 committed Virginia to support a $3.7 billion rail bridge project agreement to allow the number of Amtrak trains serving Virginia to double over the next 10 years, providing nearly hourly service, and increase VRE commuter service by 60%.

Quite literally, nearly everybody at the time agreed that was a good decision.  But it was based on growth assumptions that proved faulty.

One year later, VRE is in desperate straits.  In April of this year, ridership is down to less than a quarter of what it was before the pandemic.

As of (April 22, 2022), according to ridership documents, not a single train from Fredericksburg to D.C. and back was even half full, and many were even emptier. The numbers on the Manassas line were even lower.

Is VRE expansion still cost-effective?  How about metro rail, which has had similar ridership declines.

Again, I don’t know, but Virginia should revisit its planning.

Energy.  How will this change the locations and quantities of energy demand? All types of energy – electricity, natural gas and petroleum products? Suppliers will have to adapt.  Will government regulations allow them to do so?

Education.  How should the estimates of future public school capacity and location requirements change in various parts of the state?

Rural Virginia.  Governments have made assumptions about continued movement away from Virginia’s rural areas.  Will those assumptions hold as those beautiful areas get broadband?

Some of southwest Virginia – see Wise County as example – already has wonderful schools.

The rural broadband initiative was targeted at providing services to existing residents.  It can now prove an attraction to telecommuters.  Perhaps it can be marketed that way in the D.C. area to keep current Virginia residents in Virginia.

Richmond.  How much of the City of Richmond’s tax base depends upon white collar businesses and white collar headquarters including those of the state government? How about the industries that service those headquarters and their employees? How about restaurants and hotels?

How will Richmond adapt and function under a lowered tax base or try to keep the one it has?

Governments must not be the last to adapt. In Virginia, both state and local governments must begin to project the impact of the reductions in physical commuting and increases in telecommuting in order to tailor investments and prepare for dislocations – some positive, some negative.

The Washington D.C. government gets it.  March 15, 2022 marked the high water mark for COVID-era office occupancy in the capitol, at 41.56% of pre-pandemic levels; it is slightly less currently.  D.C. is already adding tax incentives and redevelopment plans to encourage businesses to stay.

I grew up in Northern Virginia.  It was bucolic in the 50’s as close in as what is now the beltway.  I would not live there now for any reason.  To say that Fairfax County political leaders failed to plan for the expansion of their county is to beat a long-dead horse.

Will the suburban governments plan for the new trends?  How many people will leave Northern Virginia with their families if they no longer must stay there for work?

At the state level, regardless of the short term outcome of the state government’s current attempt to get state workers back to their offices, government will have a hard time controlling that in the longer term.

Government has no control about the decisions of private companies, including the non-profits with which Virginia is thick.  And no control over peoples’ decisions about where to live.

How will that change the tax bases of the cities and suburbs of those cities and their requirements for tax expenditures.

Will both the tax bases and the expenditure requirements of Virginia localities including rural areas go down or up at the same rates as planned three years ago?  It appears not.

What to do?

I have no idea what the scale of those impacts will prove to be over time.

It will really depend on the results of thousands of decisions between employers and employees over remote work and family decisions about where to live.

But big changes have come and will continue.

Virginia governments need coherent strategies with which to deal with them.

But they must get the planning assumptions right or, better yet, create several sets of assumptions, model them and test the models regularly for validity over time.  Perhaps the state can coordinate local projects to make sure they have the right resources.

As but one resource, ODU’s Virginia Modeling, Analysis and Simulation Center (VMASC) in Suffolk likely can help.

Note 1.  Ten years ago America’s 30-year fixed mortgage rate was 3.31%.  That resulted in a monthly payment of $1,096.27.  The average weekly mortgage rate for a 30-year fixed jumped to 5.27% as of May 5 of this year.  That requires a $1,383.61 monthly mortgage payment for the same 30-year fixed loan.  That, of course, does not include the rise in property taxes.


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42 responses to “Planning for Telecommuting’s Effects on Virginia”

  1. Nancy Naive Avatar
    Nancy Naive

    FWIW, we still maintain a 20+ office suite, all at least 10×10 individual offices. Pre-pandemic we had only two 100% at-home employees (3 if you include me as I’m still considered an employee) who did not have assigned offices and two partial at-home on a regular and scheduled basis. The rest were catch as catch can with most putting in their 40+ in their office space.

    This has changed. There are now only 4 employees in the office space. Unless the work involves classified equipment or documents, or a need to collaborate, the rest of us work 100% from home.

    When our lease ends in 2024 (yep, we signed a 5-year just before the stuff hit the fan), there are plans to reduce our space to the current 4 persons, conference, classified space, lab, kitchen, and a handful of offices to share.


    OTOH, we (spousal unit and I) have found weekend hotel occupancy at nearly 100% everywhere we have gone in the last, oh say, 8 months. It’s just an observation, but I swear it has gotten worse. Don’t wait to book anymore.

  2. energyNOW_Fan Avatar

    Part of VRE’s problem is that it is solely a work-and-back commuter train, with no weekend/evening/holiday trips. Except for the special July 4 Fireworks Express offered for a few years, VRE cannot easily be used like Metro as a general way to get into DC. The expansion plans attempt to broaden the VRE role to weekends etc, which may be a step in the right direction re: ridership.

    1. James C. Sherlock Avatar
      James C. Sherlock

      I actually hope that the availability of telecommuting lets federal agencies recruit all over the country as they replace workers who leave or retire. It offers a chance to raise the quality and lower the costs of government.

      1. killerhertz Avatar

        I would think it’s more efficient to just remove government.

  3. Nancy Naive Avatar
    Nancy Naive

    Be careful for what you wish… all those big city liberals flooding into the country will make gerrymandering really, really hard.

    1. Donald Smith Avatar
      Donald Smith

      You mean, like in New York and Illinois?

      1. Nancy Naive Avatar
        Nancy Naive

        Show me a State where more Republicans voted than Democrats and where there are more Democrat State Reps than Republican. The converse is a piece o’ cake.

  4. Donald Smith Avatar
    Donald Smith

    The beauty of telecommuting is its potential to revive Rust Belt, rural and other struggling communities, where people want to stay in the community but feel compelled to leave because there are no jobs there. Now, your big-city-based company can let you work from home, or set up a “branch office” in a WeWork-type of setup in a small town. Good news for the folks that Salena Zito writes about.

  5. Eric the half a troll Avatar
    Eric the half a troll

    The telecommuting trend from here forward will be toward the office. It has already reached its apex. But the commercial real estate crash show has yet to drop due to long term leases. It is still coming.

    1. James C. Sherlock Avatar
      James C. Sherlock

      What is the basis of your view that telecommuting has reached its apex?

      1. DJRippert Avatar

        First, for my part, observations of traffic while driving to and from work every day. It is increasing almost daily.

        Second, update from Amazon on their construction of two 22 floor towers in Arlington to support their East Coast HQ. Apparently, they are moving forward with a lot of space.

        Third, the amount of construction in Tysons around Capital One and in Arlington around Amazon.

        Finally, a study of the Pandemic of 1918. Everybody thought the world would change then too. Other than nursing taking off as a profession, almost all of the predictions of change were proven wrong.

        As a footnote – young people are the core of technology. And young people want to live in Arlington, not Wise County. Young people also tend to live communally in fairly cramped quarters. Working from home has great appeal to older people in large houses but not so much appeal to young people sharing an apartment with two or three friends.

        1. James C. Sherlock Avatar
          James C. Sherlock

          Points taken. I won’t be around to see the future I suggest as possible here one way or the other. Governments using modeling and yearly updated data to improve projections of growth or lack of it is my recommendation here. Wasn’t possible in 1919.

        2. Eric the half a troll Avatar
          Eric the half a troll

          DJ pretty much nailed it. Plus look at the way Virginia government policy is heading. Lots of indicators say it is past its peak.

          Plus, young people like living in or near the city for the nightlife… not much of that in Wise Co.

          1. Super Brain Avatar
            Super Brain

            I also think DJ has it spot on. I do not understand why anyone who want to live or work in Scott’s Addition but many do. Real estate is like a gold rush over there.

          2. Lefty665 Avatar

            There’s cow tipping, mailbox bashing and sex. It’s not without its attractions:)

        3. killerhertz Avatar

          They didn’t have computers in 1918 glol

          1. DJRippert Avatar

            But there wwere computers in 2010 – 2019 and rural areas still de-populated.

            People said the cities would de-populate in 1918 because nobody wanted to be caught in those cities by the next epidemic. he cities growth accelerated after 1918.

            Scientific medicine in the US took a step backward because people didn’t see how it helped in 1918.

            All fleeting.

            If rural areas are so compelling because of the clean air, low traffic, low costs, low crime, etc you should see a lot of people retiring t0 the countryside.

            But you don’t.

            Rural areas have been de-populating for the past 100 years.

            By 2030 COVID-19 will be nothing more than a footnote in the history books.

          2. killerhertz Avatar

            I live in Fauquier county. We’re seeing some development growth due to zoning control (super wealthy influencing where things are built and via conservation easements), but there’s a lot of demand to live here. Many people are working remote and/or hybrid. Working in the office 2-3 weeks and making the long (early) commute to beat rush hour is much more palatable for most. Fairfax/Loudon is going to shite and Arlington already is.

          3. DJRippert Avatar

            Hybrid seems a lot more likely to work in my mind. People have to remember that if a company can hire someone to work 100% remote from Wise County that same company can hire someone to work 100% remote from Belize too … for a lot less.

          4. killerhertz Avatar

            I work in engineering and in 2010 the tools weren’t quite available for remote work for most people. By around 2015 I’d say communication infrastructure and networking tools were sufficiently capable that could support fully remote. However, it took a pandemic for companies to “buy in”. During the first pandemic lockdown March 2020 my team lead (a boomer) couldn’t understand how we making constant progress on deliverables. He finally realized that the tools we were using for years supported work from anywheere.

            The nice thing about exurbs is that it was/is possible to get by with a single income out here. This is good news for homeschoolers/unschoolers. Honestly I think the suburbs close to the city are a lose-lose. You get all the sprawl and none of the benefits of city living. In the exurbs you get cleaner air, more green space, fewer traffic/lights, adjacency to farms, etc. but can still visit the city on the weekend. I cringe every time I visit Fairfax now. But, to each his own.

          5. Lefty665 Avatar

            Greater use of medical care and distance to cities to access it probably has something to do with more geezers not retiring to the country.

          6. DJRippert Avatar

            Post-pandemic rents in NYC …

            “We’re seeing that rents have returned and basically surpassed where they were prepandemic,” Nancy Wu, an economist with StreetEasy, a real estate website, said of rents across New York.

            Apparently, the people who fled to work from home in suburban and rural locales are back in the city.

        4. energyNOW_Fan Avatar

          Both Metro and VRE are reporting, on the news, significant growth in ridership last few months. Of course mixed blessing for Metro as they have to fix the train car derailing prob.

  6. Dick Hall-Sizemore Avatar
    Dick Hall-Sizemore

    Two problems that I see to this image of folks abandoning the cities and decamping to rural areas and happily working from home. First, it is still not clear the extent to which folks will be working from home, rather than going in to the office. Therefore, it is hard to plan for something for which the trend is not clear. As for use of offices, several years ago, the state embarked on purchasing office buildings in downtown Richmond with the intent to house more state agencies in owned space, rather than leased space. With Youngkin’s recent order essentially telling employees that they will have to spend at least four days a week in the office, the state will not have the embarrassment of a lot of buildings with a lot of empty offices.

    The second problem is that a lot of rural areas in Virginia do not have broad band. Therefore, folks will not be able to move to bucolic areas or the scenic Southwest if they need to work from home. It will take several (many?) years to get the whole state wired. In the meantime, all those telecommuters will be working from where they now do: in the metropolitan areas or counties on the fringe of the metro areas.

    1. James C. Sherlock Avatar
      James C. Sherlock

      I wrote about long term trends and their potential impact on Virginia. The rural areas are getting broadband.

      As for Northern Virginia, for decades as the federal government expanded exponentially, it has had to settle for what they can get from the D.C. metro area. In some of the less visible agencies, that has meant slim pickings.

      As I told another reader, I strongly support the federal government taking advantage of telecommuting to broaden its personnel recruiting across the country. Broadening the life experiences and perspectives of the federal work force offers great benefits to governance in the future.

      It will also reduce the costs of government.

      Just within Virginia, a GS 14 step 6 living in Wise County makes $130,106.82 / year. That same official living in Fairfax County makes $147,271.51 / year.

      It took 50 years for Northern Virginia to become the tangled behemoth it is. I don’t think it will take another 50 for it to start to unwind.

      With modern modeling and simulation techniques and good annual data from the Bureau of the Census, the federal Office of Personnel Management, the state and the Department of Labor, and the Virginia Department of Human Resource Management, local governments should be able to do a better job of planning going forward than Fairfax County did as it was expanding. If they use those data and adjust the models.

      1. Lefty665 Avatar

        $130k sticks out a heck of a lot further in Wise than $147k does in Fairfax.

        A lot of folks will find the transition to the bucolic rural paradise not much to their liking. It is things like maintaining your own septic system instead of a public sewer, taking your trash to the dump instead of setting it at the curb, and driving longer distances for everything from groceries to gas or the hardware store many will find it distasteful to adjust to.

        A Louisa County Manager had a wonderful list of anecdotes about the outrage of city folks moved to the country. They included things like complaints about the cows at the adjacent farm making too much noise, anguish about air quality when a farmer fertilized with pig manure or farm equipment clogging up the roads.

        People need a reality check before they ditch the city, move to the country, eat a lot of peaches, and paint their mail box blue. There is a reason towns/cities developed and there is a lot of utility in them.

        1. DJRippert Avatar

          Exactly right. Why do you need Zoom to collaborate? There were conference calls long before Zoom. Yet people didn’t escape the crowded and expensive cities to work via conference call.

          I lived in the country and I liked it. But … there are some downsides – as you mention. Learning how to use a broom and a smooth high sided plastic garbage can to get snakes out of the house being one. Clouds of mosquitoes being another. But the biggest is the isolation. A lot of modern business is fueled by young, single people. When the workday is over, they want to hit the gym, a good Chinese restaurant or he singles bar. hey generally don’t sit by themselves on the porch watching the sun set.

          1. Lefty665 Avatar

            Black snakes are our friends, but they do sometimes need some encouragement to live outside.

            You’re right, as young adults my kids were sure they wanted to be in town. They’ve moved back to the country as they’ve gotten older but it took 15 or so years of living in the city. One commutes to town to work, the other mostly telecommutes.

            The isolation is real, you have to be comfortable with yourself and taking care of yourself and family. There is also joy in walking through fields and woods.

  7. f/k/a_tmtfairfax Avatar

    A number of thoughts.

    One, local governments will have a financial problem as more telecommuting and smaller office needs translate into lower commercial real estate revenues. That will translate to choices elected officials don’t like to make – cut spending increases (saying no to stakeholders) or continuing to raise residential real estate taxes ever higher over increase in personal income (making affordable housing problems even greater).

    Two, public transit is a huge money loser. Running more emptier trains will only push up the size of deficits, pressuring government for bigger subsidies.

    Three, even though I have regular electronic connection with my colleagues, I’m beginning to feel isolation from working from home 100%. I miss going into the office several times per week. Of course, my commute was just under five miles each way. According to Alexa, it’s now a four-hour plus drive in good traffic. So, working from home is the only sensible choice. But, over time, companies will need to address the isolation issue to avoid losing good workers and also decreases in productivity.

    1. Lefty665 Avatar

      Local income taxes like Maryland has are one way to deal with declining commercial real estate revenues. Don’t expect that change would be popular in Virginia, but it does maintain the revenue base and spreads the pain widely.

      1. f/k/a_tmtfairfax Avatar

        The problem for elected officials is to find a way to get a significant sum of tax revenue from business taxpayers. For example, Fairfax County has a long-standing goal of recovering a full 25% of real estate taxes from commercial properties. I don’t see how a local income tax achieves this result.

        1. Lefty665 Avatar

          It is really pretty simple. Set the local income tax rate to make up the difference between goal and actual commercial real estate tax revenues.

          Maryland’s local income taxes vary widely. I had to write a tax table that allowed each locality to be different, and many were. Presumably they were adjusting for something.

          1. f/k/a_tmtfairfax Avatar

            You are still missing my point. The goal of many local governments in NoVA has been to obtain a significant percent of total real estate taxes from commercial real estate to prevent even higher real estate taxes from residential landowners. To the extent that telecommuting reduces the need for office space and, hence, commercial real estate taxes, that strategy doesn’t work.

            Substituting a local income tax for real estate taxes could obtain the same amount of tax dollars but would not likely result in a higher proportion of the local tax dollars coming from commercial property.

            See the attached link discussing residential versus commercial taxpayers in Colorado.

            The bottom line that substantial increases in telecommuting will likely push more of the costs of local government on residents, which, in turn, will create pressure on local government to find other ways of taxing business or reduce increases in spending.

      2. energyNOW_Fan Avatar

        Maryland local tax approach is what Virginia accomplishes with our ridiculous annual Car Tax. Get rid of the Car tax, as far as I am concerned, that is bad policy. But yes we would have to have a different new tax instead.

        1. Lefty665 Avatar

          Localities have a very limited number of ways to raise revenue. Property taxes, real, automotive, or personal cover a lot of the water front.

          I live in a county that spans I-95. That put me in favor of a meals tax that would have collected 3/4 of its revenue from transients. My contribution would have been small, and it seemed like a pretty good deal locally. More folks were affronted that they would pay a little more when dining out. But, they pay on their cars and boats, real estate and business property. Go figure.

  8. Super Brain Avatar
    Super Brain

    NOVA may suffer bur Chesterfield, Hanover, and Henrico will do fine. People still want good schools and medical care. Rush hour traffic around here has pretty much gone back to normal.

  9. Lefty665 Avatar

    The rural broadband initiative was targeted at providing services to existing residents.

    Hahaha… I’ve been stuck with pokey and profoundly async DSL since it became available in ’04. On a good day, and they are rationed, I get 12mb down and 1mb up. Every time a cow rubs its butt on the barbed wire it is strung on delay skyrockets,

    Musk is years behind his Starlink promises (hope he’s enjoyed my $500 deposit), the REC positively glacial in exploring fiber on power poles and the phone company completely uninterested in running last mile fiber from their DSLAMs,

    I grew up in Northern Virginia. It was bucolic in the 50’s as close in
    as what is now the beltway. I would not live there now for any reason.
    To say that Fairfax County political leaders failed to plan for the
    expansion of their county is to beat a long-dead horse.

    Me too and yes it was. Then they built the beltway around us. Fairfax was a wilderness with islands of new sub divisions. The Richmond area has undergone similar but smaller scale changes over the last 50 years, especially Henrico and Chesterfield and increasingly Hanover.

  10. DJRippert Avatar

    “To say that Fairfax County political leaders failed to plan for the
    expansion of their county is to beat a long-dead horse.”

    Lol. I have never been to Hampton Roads without encountering an absolute traffic fiasco. It’s like a mini-Los Angeles with no center of gravity and random, slipshod development everywhere … including in the flood plains! No doubt the Hampton Roads folks will be coming hat in hand to the state and feds for money to bail out some of the worst low lying development I have seen outside of pre-Katrina New Orleans.

    Your home town(s) is/are sinking, Captain! Stop building!

    1. James C. Sherlock Avatar
      James C. Sherlock

      I grew up in Fairfax County, not Virginia Beach. Both grew by uncontrolled sprawl because real estate interests ran the city/County Councils. Still do. Still not planning properly – look, at the Virginia Beach light rail fiasco that voters had to vote down.

      1. DJRippert Avatar

        I grew up in Fairfax County too and still live in the county. I agree with the real estate interests controlling local government … all around the state. Just another example of the ingrained corruption in Virginia politics.

        But outside of Virginia there are problems with high growth areas. Austin has gotten very crowded and is getting very expensive. Nashville is starting to have traffic problems. Charlotte can get congested.

        My theory is that high growth areas need a certain density to evolve from suburb to city. Arlington and Alexandria are there – with about 10,000 people per sq mi. Fairfax County is much larger and has a population density of 2,800 per sq mi. The county is still an adolescent in its growth toward becoming a city.

        Once upon a time there were farms in New York City.

        1. f/k/a_tmtfairfax Avatar

          One of my 7th great grandfathers had the beer delivery franchise in New Amsterdam. Beyond the tip of Manhattan, the rest of the island was pretty rural.

        2. Lefty665 Avatar

          Falls Gulch was my hometown. You couldn’t pay me enough to move back, although for years I wasn’t sure there was life outside the center of civilization as symbolized by the beltway. Turned out there was, and is. Who’d a thunk it?

          Charlottesville has both a nasty rush hour and high real estate prices. It ain’t a sleepy little college town anymore.

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