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Update: Meals Tax Referendum Moves Forward

by Karen Goff May 4, 2016 at 10:00 am 27 Comments

Barcelona at Reston Town CenterThe Fairfax County Board of Supervisors Budget Committee has recommended that a meals tax referendum be put to Fairfax County voters in the general election this fall.

The idea will now go to the entire Board of Supervisors for a vote.

The meals tax, which supervisors last discussed — but decided not to go to referendum — in 2014, was brought up this spring by Hunter Mill Supervisor Cathy Hudgins.

The county is continually facing a budget gap, and supervisors last week voted to raise property taxes 4 cents per $100 of home value. Hudgins and many of the other supervisors say the county cannot raise real estate taxes every year and must diversify its sources of revenue.

A meals tax of about 4 percent, similar to what is levied in nearby jurisdictions, would give the county an additional $93 million a year.

Part of the reason for the strained budget: growing needs of the Fairfax County Public Schools, the nation’s 10th-largest school system. The county transfer to the schools for Fiscal Year 2017 will be $2.1 billion, which represents about 52 percent of the county’s $4 billion budget.

“While there remain unmet needs in the school system, there are also challenges and unmet needs that Fairfax County Government and FCPS face together in the FY2017 budget and the FY2018 projected shortfalls,” Hudgins said.

“However, taxpayers cannot continue to shoulder the impact of increased Real Estate taxes every year. We must look to find additional revenue sources to lighten the load. ”

Hudgins said bond rating agencies have warned the county of the need to diversify revenue streams.

“A meals tax is one tool that we can use,” said Hudgins. “This is a tool used by cities and towns within and adjacent to Fairfax County. It is time for Fairfax County to join these counties and begin diversifying our revenue sources.”

Some of the nearby places where diners are already paying a meals tax:

  • Town of Vienna – 3 percent
  • Town of Herndon – 2.5 percent
  • Alexandria, Arlington, Fairfax City, Falls Church, Manassas, and Manassas Park – 4 percent

Grassroots groups have already formed on both sides of the issue. Many local restaurants are against the tax, while many school advocates are in favor.

Representatives for Clyde’s, Great American Restaurants (Jackson’s) and Glory Days Grill have called the idea “taxation without representation at its worst.”

Photo: Barcelona at Reston Town Center/file photo

  • NoWayJose

    How much money would be saved if Fairfax County resolved it’s ‘undocumented citizen’ status? How much money would be saved if ESL wasn’t needed and class sizes were reduced?

    Of course, that would be inhumane. Better to just take more of my money.

    • Nyla J.

      We could ask Prince William County how much they saved.

  • Facts matter

    Meals taxes are pretty common and Fairfax should get that revenue.

    “Town of Vienna levies a 3.0 percent meals tax and the Town of Herndon imposes the meals tax at 2.5 percent. Other Northern Virginia localities that tax meals are: Alexandria, Arlington, Fairfax City, Falls Church, Manassas, and Manassas Park. Each of these jurisdictions levies the meals tax at 4.0 percent.”

    • Mike M

      So, we should be followers? Your argument is “everyone else does it.” I am thinking even my kids know thew value of that one.

      The County should “get that revenue?” Why? You might have realized that the County already gets quite a bit of revenue. Does it not matter what they do with it? How about the schools address their real challenges with some honesty.

      Why don’t you just kick in and leave my wallet out of it.

      • Chuck Morningwood

        They won’t do that. That would mean a reduction in Garza’s fiefdom, and more threatened teacher layoffs.

        • Mike M

          I suspect it is the ed mafia in here pretending the tax is such a great idea. Can you believe the arguments they use? And they are educating our kids?

    • more facts

      Northern Virginia revenue from meals taxes:
      City combined tax meals tax revenue (millions)
      Alexandria 6.0% 4.0% $17.6
      Arlington 6.0% 4.0% $34.7
      Falls Church 6.0% 4.0% $2.7
      Fairfax City 6.0% 4.0% $5.4
      Herndon 6.0% 2.5% $2.0
      Vienna 6.0% 3.0% $1.9

      Estimated revenue in Fairfax County:
      $90 million.

      • Mike M

        If they imposed a child tax, or an income tax, they could do well too. Especially if they imposed on everyone, which they won’t. If they put a toll on the roads, they could raise money too. So, what ever is your point? More money in the County’s coffers is good no matter what? Then why not so all of these silly things?

    • Chuck Morningwood

      Just because they jumped off the bridge doesn’t mean that we should take the leap as well.

      • NOT!

        A 4% meals tax is exactly akin to suicide.

        • Mike M

          No. It’s not. But neither is a poke in the eye. That doesn’t make it a good idea. Neither does the fact that other places have them. Capisce?

    • PD Kay

      So if Vienna charges 3% and Herndon charges 3.5%, and the county charges 4% if the referendum passes, will that mean paying 7% in Vienna and 7.5% in Herndon for meals? As subdivisions to the County of Fairfax, they usually pay whatever county taxes apply as well. If that is the case, restaurants in Vienna and Herndon will very definitely take a hit as people eat outside of the towns to manage meal costs

      • nope

        No. Those are towns and cities. The tax would not be cumulative.

        • PD Kay

          Neither Herndon nor Vienna is a city – in Virginia, cities are independent of counties and therefore residents do not pay any taxes to any county. As towns, Herndon and Vienna are political subdivisions of the County of Fairfax. Residents there pay both town and county taxes. Why would they not also pay for a county meals tax?

  • Mike M

    Cathy and Sharon just got re-elected. Post election is the part of the political cycle where the most egregious issues are foisted on the constituency.

    The revenue diversification is a lie. If that were the issue and they lowered property taxes commensurately, I’d be for this. But this is a whole new additional tax. Hudgins is being disingenuous when she says this and it is an organized and dishonest messaging campaign that describes this new additional tax that way.

  • Rod Ham

    I hope they increase it from 4% to 20% so we can give away more free stuff.

  • cRAzy

    And don’t forget the $.025-$.035 per $100 valuation “special” transportation tax you’re about to get hit with just because you live in Reston.

    Not to mention the $.047/$100 valuation you pay for the Reston Community Center.

    …pretty soon you’re paying real money!

  • Ming the Merciless

    Ramen noodles – the official food of the Fairfax County taxpayer

  • Grover Norquist’s ghost

    How many of the anti-taxers actively avoid eating out in the other municipalities that have a meal tax?

    And before you answer, I’ll just say BS.

    • Mike M

      Oila! Self-licking ice cream cone!

      So, . . . people might not avoid it so we should go ahead and charge it? Does that really make sense? No. What do the experts in the restaurant business say?

      Your logic is the same as saying, Well, we can probably get away with it! Let’s do it!” Might as well stick you with another $250 or $500 in property tax next year. You probably won’t move to Prince William or Loudoun.

      I have yet to see a valid argument in favor of this new tax increase.

  • Bern it Down

    We need to save the Bay and add a dishwasher tax of 5% to those businesses. Think of all the soapy water they generate and all that grime that gets washed down their drains. Its horrible, the poor snakeheads must be lemony fresh by now.

  • Chuck Morningwood

    How about if we add a 4% Illegal Alien tax instead? Of course, since we don’t know who they are (and don’t seem to want to find out either), it might be hard to tax them.

  • Ed Cacciapaglia

    Sometimes you just have to vote “no”. Last time the meals tax was voted on it was soundly defeated, The same thing should happen this time assuming the Board of Supervisors forces us to vote on a referendum.

    I wonder how heavy in administration the Fairfax County Schools are compared to other jurisdictions. I’m betting the teachers won’t see a dime of any of the hypothetical revenue derived from any meals tax.

    • Chuck Morningwood

      Even if the Constituents vote down the Referendum, I’m sure that the implication of that will be completely lost on Garza. I’m sure that she’ll probably see it as “Oh. I guess they want us to find a different tax to pay for next year’s budget increase.”

  • Greg

    But, the BoS are raising MANY other taxes in the already diversified revenue stream: Last week, the Board of Supervisors voted 7-3 to formally approve a property tax rate of $1.13 per $100, an increase of 6% to the average homeowner (26% over 5 years). This will increase the average annual Real Estate tax bill for homeowners by approximately $304; this is on top of the $185 increase in last year’s tax bill. In addition to the increase in the real estate tax rate, the Board voted to increase the storm water tax, Sewer Service charges, athletic fees, and a number of other taxes.

  • Greg

    A tax on a single industry that currently gives back to our schools and community in various ways including, sponsoring youth groups, donating to various organizations, as well as providing first jobs and careers to our residents. This potential added tax includes restaurants, grocery stores, delis, food trucks, convenience stores, caterers, movie theater concessions, hotel food services and coffee shops. A Meals Tax would undoubtedly have an enormous adverse impact on our low income families as well as our senior citizens.

  • Greg

    Wasteful county spending? We repeatedly hear that the county has cut costs to the bone, but below are a few recent spending examples that would seem to contradict that premise:

    Just last month the Board approved $1.5M to $1.7M in developer proffers to subsidize condo units in Tysons to make them “affordable” for people making $80K to $100K per year instead of using these developer contributions on priorities like public safety, schools, transportation, or to help those truly in need.

    Earlier this year the Board approved spending $7.2M to purchase a building in Bailey’s Crossroads so we could tear it down to build 20% of a road that has not been studied or designed. What is even more curious is that the building was assessed at $3.8M in 2015, but its assessed value was raised to $4.8M just before purchase, despite the fact that no improvements had been made to the property in that time.

    This budget includes $1M to go to Supervisors’ offices ($100,000 each), for unidentified small projects in their districts.

    This budget includes $7M in emergency repairs for apartments it purchased for over $107M in 2007. The $7M is a down payment on $54M in repairs needed at Wedgewood. No reserves have been set aside to cover capital repairs. The County should not be in the landlord business.

    During the budget deliberations, we used all of the third quarter carryover to fund one-time expenses in next year’s budget, freeing up ½ cent on the tax rate. Instead of giving that back to the taxpayers, the Board spent it.

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