WEEKLY GOVERNMENT AFFAIRS CALL
VRLTA Government Affairs Update – Call Agenda
 
TOMORROW - Friday, February 7, 2020 – 2:00pm
Dial-in Info: 202-602-1295
Access Code: 789-103-256#
 
  • Welcome – Gary Cohen – Government Affairs Committee Chair
  • Bill Tracker - Robert Melvin
  • VRLTA Legislative Reception and Day on the Hill Recap – Robert Melvin
  • Upcoming Tourism Caucus Meeting - February 12 - Robert Melvin
  • VRLTA Tipped Wage / Minimum Wage Advocacy Efforts - Robert Melvin/Eric Terry
  • Phone 2 Action Advocacy Tool – Robert Melvin
  • ABC Legislation and Regulations – Tom Lisk
  • AHLA/AAHOA/NRA Updates – Eric Terry/ Chris Savvides/ Vinay Patel
  • Other New Business
IMMEDIATE ACTION NEEDED  - Contact legislators about equalization of taxation authority between cities and counties - to be addressed in the General Assembly TOMORROW!
Oppose HB785 and SB588 - contact your legislators!
 
Currently, Virginia places limitations and restrictions on counties and the meals, lodging, and admissions taxes they can impose on their businesses and citizens.

  • Counties are precluded from adopting meals taxes unless approved by voters through a referendum and any such levy may not exceed four percent.(1)
  • For lodging taxes, any county may adopt a transient occupancy tax up to two percent; although, anything above two percent must approved by the General Assembly and be designated and spent solely for tourism marketing.(2)
  • When it comes to admissions taxes, counties are forbidden from adopting an admissions tax unless specifically enabled by the General Assembly and when authorized the admissions taxes may not exceed 10%.(3)

These limitations have helped protect Virginia businesses, consumers, and travelers from excessively high taxes in many jurisdictions across the Commonwealth; however, there is an effort underway to roll back these taxpayer protections and allow counties to impose meals, lodging, and admissions taxes without limitations through HB785 and SB588.
 
We need you to contact your legislators NOW to oppose these measures. Choose one of the options below and you'll be able to send a message to your delegate, senator, and the governor.
 
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More information...
 
While counties argue that these other revenue streams would allow them to reduce property taxes, there is no means in the legislation to ensure they actually reduce other taxes they levy. In addition, counties are asking for additional taxing authority like cities; however, they are not required to have the same responsibilities as cities such as maintaining their own roads and being subject to lawsuits. 

  • According to the Tax Foundation, of the past 60 attempts to pass a meals taxes in counties in Virginia, 47 of those proposals at the county level have failed, with approximately 57% of the voters voting against the initiatives.
  • Meals taxes are regressive. According to the Bureau of Labor Statistics Consumer Expenditure Survey, households with annual incomes of less than $30,000, spending on restaurant food represented 8.1 percent of their pre-tax income, or four full percentage points above the national average. This means that meals taxes have a disproportionately larger impact on lower income households who are less able to absorb the costs.
  • The National Restaurant Association found that on an average check size of $15 to $25, the average number of local citizens impacted by meals taxes was 70%. For checks less than $8 the amount of local citizens paying a meals tax was 85%. Regardless of how many tourists pay the potential increase, all local citizens will be impacted by the new tax.
  • Generally, when lodging taxes are imposed for the express intent of encouraging travelers to visit, it creates tangible economic benefits for the community as these dollars are reinvested into the hotel industry and tourism overall.
  • Allowing counties to raise hotel taxes without requiring funding be dedicated to tourism promotion could harm the locality when it comes to attracting visitors.
  • Tourism is Virginia’s 5th largest private sector employer and a $26 billion a year industry generating $1.8 billion in state and local taxes. It supports approximately 490,000 jobs in Virginia according to the American Hotel and Lodging Association and National Restaurant Association.
  • Marketing and tourism promotion is not an expense, it’s an investment. According to data collected by the Virginia Tourism Corporation, every $1 generates $7 in tax revenue for Virginia.
  • Allowing counties to impose any admissions tax rate they desire will increase the prices of tickets that consumers pay for sporting events, speaking engagements, movies, concerts, carnivals, circuses, and amusement parks.
  • Substantial admissions taxes will keep artists and musicians from selecting venues in Virginia. Since many musicians make their living touring and no longer from CD and record sales, and if the ticket prices are too high and could depress turn out, the musician will skip that market altogether.
  • Meals, lodging, and admissions taxes are discriminatory in nature. Singling out restaurants, hotels, and attractions as a method to generate funds to pay for general service needs will harm the businesses employees and consumers. 

For these reasons, we urge you to oppose SB785 and HB588. Not only will they harm Virginia’s tourism industry, they will adversely impact consumers who will have to pay higher prices and employees who may lose benefits, raises, or their jobs.

Sources:
(1) Arlington, Frederick, Montgomery, Roanoke, and Rockbridge Counties are exempt from the referendum requirement but the governing body must approve the meals tax by a unanimous vote.
(2) 14 counties have been given the authority to impose additional transient occupancy taxes at varying rates up to 5% with revenue used for restricted purposes related to tourism.
(3) 13 counties are allowed to levy an admissions tax, but according to the Virginia Tourism Corporation Excise Tax Rates and Collections only Dinwiddie (4%), New Kent (4%), and Roanoke (5%) impose one.
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VRLTA GOVERNMENT AFFAIRS COMMITTEE
Committee Chair
Gary Cohen - Glory Days Grill
 
Committee Members
Steve Helms - Primland
Matt Simmons - Capital Ale House
Brad Capps - The Breakers Resort
John Shaffer - Luray Caverns
Doug Wilkins - BF Saul
Tony Stafford - Ford's Fish Shack
Randy Thompson - VistaGraphics, Inc.
Frank Brunetto - Rueger Restaurant Group
Nav Patel - Marquee Hospitality
Chris Savvides - Black Angus Restaurant
Charles Friend - Residence Inn Charlottesville
Beth Erickson - Visit Loudoun
Jim Wordsworth - JR's Stockyards
 
Advising Members
Tom Lisk - Cozen O'Connor
Shannon Conway - ABC Subcommittee Chair 
Rita McClenny - Virginia Tourism Corporation
Barry Biggar - Visit Fairfax - VRLTA Board Chair
Eric Terry - VRLTA
Robert Melvin - VRLTA