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Fredericksburg may increase meals tax
Fredericksburg City Council considers raising meals tax and tapping into reserve money to help offset budget cutsDate published: 4/8/2009 BY EMILY BATTLE Fredericksburg's budget for next year is still very much up in the air, but council members said last night they'd like to look for ways to restore the salary cuts that take effect this month in City Hall and to restore some of the cuts proposed for the city schools. To do those things, they would likely have to raise the meals tax and spend even more one-time reserve money than is already proposed. And before they're finished making those decisions, council members will have to consider whether they want to raise personal property taxes on vehicles to make up for a loss in assessed value. The potential impact of that loss has not been quantified yet, but Spotsylvania and Stafford counties have both proposed raising their vehicle taxes to make up for lower car values, as people hang on to old cars longer and the market puts a lower value on SUVs and other large vehicles. Restoring city employees' salaries appeared to be the top priority of most council members during a work session last night. With a 3-cent hike in the real estate tax rate already proposed, council members discussed looking to the meals tax to find the $285,000 it would take to restore the 1 percent to 1.5 percent cut employees will see in their paychecks starting this month. Fredericksburg's tax on restaurant meals and prepared foods is 5 percent now, compared to 4 percent in the neighboring counties. The city could gain an estimated $440,000 by raising it by a half percent, or $800,000 by raising it 1 percent. Council members are looking at at least a half-percent hike to provide money for employee salaries, but they didn't commit to anything last night. Council members also heard from the city school board last night. The city manager's proposed budget for next year would give the schools $1 million less than they got this year. The schools so far have found enough cuts in their budget--despite losing nearly $600,000 in state funds--to narrow the gap to $961,000. Council members last night discussed using as much as $400,000 in reserves that had been set aside for schools and the regional jail to help make up the gap with the school system. There's no agreement yet on exactly how much of that money would go to the schools. School board members last night didn't give many specifics, but they told the council members that services in the school system would have to be cut to make up the shortfall. Emily Battle: 540/374-5413
Read more stories about Fredericksburg Date published: 4/8/2009
MattKelly
(posted by
Publius2
, Apr. 9, 2009 8:17 pm)
The first task to attend to is to ensure that those that are supposed to be paying taxes are doing so. When everyone is paying at the level they are supposed to be, the revenues would increase. People that cheat on their taxes, or worse are here illegally have no right to the services provided by the law abiding tax payers. The excessive spending done one both the city and county levels are greatly exacerbated by both of these problems. Free lunch at school isn't free, it's paid for by tax payers.
Thank you Matt Kelly for answering constituents questions
(posted by
kspecial
, Apr. 9, 2009 6:00 pm)
I'm a next door neighbor in Stafford and can't vote for or
against you, but being up-front and answering questions is
exactly the kind of responsiveness I admire and expect from
elected representatives. No candidate runs on a platform of
increased taxes and if they did, they would invariably lose,
but some of us understand how difficult, but necessary it
becomes to raise taxes. Thank you for being honest and
communicating with us.
Publius2--Too Simplistic.......
(posted by
MattKelly
, Apr. 9, 2009 9:21 am)
I don’t disagree. But the concept has diminishing returns from the federal to the local level. We have seen a massive expansion of the fed. gov. since FDR’s Neal Deal that has had a corresponding affect on state government. They focus on programs, use taxes to redistribute wealth, etc. At the local level we are focused on services-- schools, trash, potholes, and public safety. The questions for us are what level of service does the community want and how much is the cost or what to we cut?
Perhaps a different approach
(posted by
Publius2
, Apr. 9, 2009 7:26 am)
Statistics show that tax increases rarely work to increase revenue beyond the short term. What has been proven to raise revenues, create jobs, and increase wages is lowering taxes. With lower prices, more volume is realized, and businesses grow and prosper. A meals tax increase in Fredericksburg equals an increase in business in both Stafford and Spotsylvania restuarants. One finds the short sightedness of the city council to be frightening. Failure appears unavoidable.
Catch22......
(posted by
MattKelly
, Apr. 9, 2009 7:24 am)
To balance the budget we cut 5M from operations, and used 1M of reserve, before looking at tax increases. Our budget is back to its 2006 level decreasing 8.6% over the past two years. Raising taxes should be a last resort. However, we but should also consider outcomes. Like business city staff should expect a fair wage and the city faces higher costs, benefits, etc. We also face mandated cost such as a new courts. The question is what is the level of service do you expect and how much does it cost?
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