Nichols broached the subject of a meals tax, which would add perhaps a 4 percent tax to the bills of county restaurant-goers and people buying ready-to-eat food and drinks. Most surrounding counties have a meals tax, Nichols said, which could bring between $300,000 and $600,000 into county coffers. He pointed out that the tax would be the only one in Fluvanna that outside visitors would help to pay.
But a meals tax requires a referendum, which Nichols said is unlikely to pass the first or even second time it lands on the ballot. He suggested starting a public relations campaign now in preparation for the 2017 election, possibly linking the income the tax would generate to capital projects such as a new school, as he said other counties have done.
Chairman Mike Sheridan supported looking into the tax. “I know I pay it every time I go to Zion Crossroads and go by McDonald’s,” he said.
Supervisors Trish Eager and Don Weaver disagreed. “The train has pulled out of the station,” protested Weaver, who often speaks out against government taking too much of its citizens’ money.
Supervisor Tony O’Brien ruffled at the comment. “I totally find that disingenuous,” he said, “because you can’t say that we need services for our citizens and then not look at tax revenues, and then say, well, we have the highest rates and therefore we can’t raise revenues. Either you’re committed to progress or –”
“It’s not a tax problem, it’s a spending problem,” Weaver interrupted.
“I know you believe that, but this county has stayed backwards for many years,” O’Brien said. “We have passed that burden onto the homeowners, and it’s the Board’s intransigence in trying to look at how to balance that rate that has forced the rate to be one of the least competitive ones in the area.”
Weaver disagreed. “Bad decisions in the past have caused us to be where we are,” he said.
“What were those bad decisions?” Supervisor Mozell Booker asked.
“I’m not going to answer that,” replied Weaver. “You know what they were.”
A babble of voices erupted until Mike Sheridan said, “Folks, we can get into that and have that debate for the next four hours.”
“I appreciate what you said, Mike,” Booker replied, “but it comes up so often that we do need to have a genuine discussion about it. Because I’ve been hearing it and hearing it and hearing it and we need to put it on the table and talk about it.”
“We have many times,” Mike Sheridan said.
“No we haven’t,” said Booker. “No, we have not been clear. [People are] just saying it over and over.”
As Weaver remained silent, Mike Sheridan moved the conversation to the next topic.
Land use
Nichols also suggested supervisors consider tweaking the county’s land use program, which taxes land at greatly reduced values if owners assert that they are using their property for agriculture, forestry, or preservation of open space.
Though Mel Sheridan, commissioner of the revenue, administers land use while supervisors merely decide whether the county has the program, Nichols said the Board could request the commissioner to consider certain changes – such as regularly revising land use values based on changes in local real estate values.
O’Brien, who has spoken out in recent months in favor of adjusting elements of the land use program, said that land use in Fluvanna is somewhat “rubber-stamped” without what he considers proper enforcement of agricultural and forestal uses. He agreed with Nichols’ suggestion that perhaps subsidized land uses should slim down to merely open space.
In theory the program cuts a tax break to people who produce financial value from their farming or forestal uses, but if land owners “aren’t employing anyone or selling any goods” then “that’s not really in line what the intent or purpose is,” O’Brien said. “You can still preserve your open space and your rural nature through open space policies” rather than agriculture and forestal uses, he said.
“If there is no enforcement mechanism behind it then it’s easy to understand why people would say this is essentially just subsidizing someone’s large estate,” O’Brien said. Without proper enforcement, he said, land use can be “an unfair benefit to a select few.”
No other supervisors initially responded to O’Brien’s assertions. Later when Nichols revisited the matter, O’Brien said that “a lot of people” in his district, which encompasses Lake Monticello, don’t find it “fair” to pay taxes on land valued at $100,000 an acre when other people pay on values such as $250 an acre.
Booker then spoke up, saying that she wants to see the land use program be “a good fit” for Fluvanna. She said she wants to show people how they are benefiting from land use even if they think they aren’t. “This is the opportunity for us to clarify this,” she said.
Weaver said that “everyone” can become involved in land use. When others pointed out that there are minimum acreage requirements, he said that people have the option of purchasing land.
Supervisors decided to ask Mel Sheridan to brief them in September on land use options, benefits, and recommendations for the program. Mel Sheridan did not attend the work session.
Business license fee
“If you’re going to do any of these [revenue enhancement options], please approve the business license fee,” Nichols told supervisors.
The $25 annual fee for Fluvanna businesses would assist in identifying and maintaining an accurate list of businesses in the county, which would help the county tax them appropriately and be able to reach them for support and marketing purposes, Nichols said.
Eager supported the idea, saying it would help the county, among other things, to know of contractors in the area so that they could inform them of chances to bid on county projects.
“It’s a little bit here, a little bit there,” said Weaver of the fee. “That’s the way government works.”
Supervisors agreed to pursue the idea.
Business personal property tax
The only suggestion that would actually lessen the money brought into the county, lowering the business personal property tax rate generated a fair amount of interest among supervisors.
Eager initially proposed the idea publicly, saying that charging businesses $1.50 per $100 valuation on their personal property rather than the current rate of $4.35 would make Fluvanna more competitive with other counties, especially Louisa, which currently charges $1.90, according to its website.
Supervisors would need to make the change with next year’s budget votes, which would make any new rate effective as of Jan. 1. The Board has already budgeted through next June, however, so a change to $1.50 would create a $95,000 shortfall. Nichols said that he expected the county could absorb that shortfall.
After the meeting Nichols explained the county’s potential ability to absorb the shortfall in the midst of a tight budget by saying, “You never budget so that you’re almost guaranteed to be short… From a personnel point of view, almost every year we hire a number of new people, and almost every year they come in at a lower cost than the person they’re replacing [due to less experience and other factors]. We also have a contingency built in for things like these. So I expect we’ll be able to cover it, and if we can’t, we’ll start cutting expenses to compensate.”
Having a lower business personal property tax, combined with not having a business, professional and occupational license (BPOL) tax, merchants’ capital tax, or other business-related taxes, could create a “compelling” picture for businesses to choose to locate in Fluvanna, said Nichols.
O’Brien said he was in favor of lowering the business personal property tax, though perhaps not to $1.50. Eager said she wanted to make sure that the tax ended up lower than Louisa’s in order to give businesses a possible incentive to switch their locations. Supervisors decided to ask Mel Sheridan to deliver a formal presentation on the topic in August.
DUI fines
Some ideas didn’t pass muster with supervisors. A possible fee paid to the county by those arrested for driving under the influence (DUI) got a quick “no” from Eager and Booker.
Another idea to increase the county’s vehicle license fees also received a mediocre response. O’Brien supported the idea but Booker and Weaver did not.
“I think people just see us as trying to get their money all the time,” said Eager.
“Well, we are,” replied Weaver.
Since an increase in vehicle license fees likely would not result in a big dollar boost to the county, Eager suggested leaving the idea alone for now with a possible discussion to come during budget season.
Administrative ideas
Nichols suggested better enforcement of rules already on the books. For example, he said, some homes sit for years with new improvements that the county doesn’t know about – and therefore doesn’t tax. He suggested better coordination between county tax rolls and multiple listing service (MLS) data, since people selling their homes publicize the improvements they have made.
Nichols similarly suggested strengthening the link between building inspections and the commissioner of the revenue, so that county tax workers become aware when county building permits are issued or completed.
Making sure the county knows about boats owned by Fluvanna residents is another way to properly capture personal property tax money, Nichols said. He suggested coordinating with Lake Monticello to find information about unlisted boats – an effort he said “has not been met with warm fuzzies” by Lake Monticello administration.
