ACTION ALERTS
County Chamber’s Position on Proposed Meals Tax
The Shenandoah County Chamber Board of Directors and Economic Development Council members have endorsed the County Board of Supervisor’s proposed Meals Tax referendum.
The Meals Tax referendum will state:
Should a meals tax of up to 4% on food and beverages sold by a restaurant be levied in Shenandoah County in order to fund education and public safety capital projects?
The Chamber believes establishing a 4% meals tax in the County will benefit taxpayers by reducing the need to raise taxes on real and personal property, while investing in public safety and education.
The Chamber conducted a poll on the Meals Tax issue during the annual Economic Development Council Breakfast held on September 17th. The poll stated the referendum language with a Yes or No response. The members in attendance voted 129-2 in favor of the meals tax.
The concept of a meals tax is not new. In fact, Shenandoah County residents currently pay a meals tax on every prepared meal within the town limits of each town in Shenandoah County and in every county along I-81 from the West Virginia state line to Wythe County. If you eat in one of our local restaurants within the Town limits you are currently paying a meals tax. The County’s proposed Meals Tax will NOT be a tax in addition to the town meals tax.
Shenandoah County has simply not approved a meals tax in the past, forgoing an opportunity to collect tax from non-Shenandoah County residents, thereby placing the full tax burden on County residents. We feel that by implementing a meals tax, it will have a positive impact on County revenues and will diversify the County’s tax base, collecting measurable revenue from non-county residents. The County currently may only collect taxes through personal property and real estate. As we all are aware, the costs for our firefighters and police to maintain our safety continues to grow and this tax will help in those efforts in addition to public education costs.
Virginia is a Dillon State, which means the County governing bodies are only allowed tax options approved by the General Assembly or voted on by its citizens through a local referendum. The Towns are governed differently and allowed to implement any tax their governing bodies support, without gaining citizen approval.
The table shown below indicates what surrounding town and county jurisdictions, who have implemented a meals tax, collected in 2017. The maximum meals tax a county can collect is 4% as directed by the General Assembly.
Town of Edinburg, with a 5% meals tax, collected over $57,000
Town of New Market, with a 5% meals tax, collected over $387,000
Town of Strasburg, with a 6% meals tax, collected over $730,000
Town of Toms Brook, with a 5% meals tax, collected over $2,500
Town of Woodstock, with a 6% meals tax, collected over $1.2M
Town of Mt. Jackson, with a 5.5% meals tax, collected over $357,000
Frederick County, with a 4% meals tax, collected over $4.9M
Page County, with a 4% meals tax, collected over $295,000
Warren County, with a 4% meals tax, collected over $940,000
Rockingham County, with a 4% meals tax, collected over $1.2M
The Meals tax is a voluntary consumption tax versus a personal property tax. If you own property in the County you are required to pay the tax, while a meals tax will be paid by those with a preference to eat out. If you don’t eat out, you are not charged the tax.
County residents will be given the opportunity to vote on the issue November 5th. We encourage you to vote Yes on the meals tax to invest in public safety and education while easing our future tax burden.
Meals Tax Background
As you may be aware, the Shenandoah County Chamber Board of Directors and Economic Development Council have been discussing a Meals Tax Referendum with the Board of Supervisors (the “Board”) for the past several months. On a 5-1 vote, the Board approved a Resolution on August 1, 2019, requesting that a Referendum be held regarding the enactment of a meals tax. As such, County residents will be given the opportunity to vote on the issue November 5, 2019. The Board decided to dedicate, or earmark, the new revenue source “to fund public safety and education capital projects”.
We have pledged our assistance in educating the public regarding the Meals Tax Referendum. As expected, the news of a County meals tax has created some level of emotion and a fair amount of misinformation. We are committed to ensuring residents understand the impact of a vote for, or against, the meals tax.
Please see the “Vote Yes” marketing pamphlet below. We believe the bullets provide a concise and compelling position to support the meals tax.
The concept of a meals tax is not new. In fact, Shenandoah County residents currently pay a meals tax on every prepared meal within the town limits of each town in Shenandoah County and in every county along I-81 from the West Virginia state line to Wythe County. Shenandoah County has simply not approved one in the past, forgoing an opportunity to collect tax from non-Shenandoah County residents, thereby placing the full tax burden on County residents. At this point, we do not know the positive impact on County revenues by implementing a meals tax. However, we are aware of the impact of meals tax revenues (as budgeted for FY2020) on local jurisdictions.
- · Frederick County-$6,100,000
- · Rockingham County-$1,300,000
- · Towns within Shenandoah County-$3,257,253
Many will debate the use of funds, the size of government and other issues; however, we believe the topic can be simplified with two questions. When Shenandoah County needs additional revenue sources to fund operations (whatever may be needed-public safety, schools or economic development, for example), do the residents want to pay 100% of the increase via real estate and personal property taxes? Or, would residents prefer it be measurably subsidized by non-County residents in the form of a County Meals Tax?
We believe a “yes” vote on the Meals Tax Referendum diversifies the County’s tax base and provides tax relief to County taxpayers.
Sincerely,
Dennis A. Dysart
Chairman, Shenandoah County Chamber Board of Directors
Chairman, EDC
Meals Tax: Five Groups Support News Release