eNews February 25, 2022Friday, February 25, 2022 - 05:38pm
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In this issue:
- Oppose: Short-term rental bill before 9:00 a.m. Monday morning
- Encourage senators to pursue a study of issues related to land and zoning bill HB1088
- Emergency Broadband Benefit program transition period ends on March 1, 2022
- Tell VML about your favorite outdoor recreation location in Virginia…and get published!
- Virginia’s 7th graders have until March 11 to enter the 2022 “If I Were Mayor” essay contest
Oppose: Short-term rental bill before 9:00 a.m. Monday morning
Bill would require localities to adopt an ordinance to tailor the operation of short-term rentals
HB1362 (Wiley) will require localities to adopt an ordinance if they want to tailor the operation of short-term rentals. The text of the relevant change to Virginia Code 15.2-983 is as follows : “If the governing body of any locality has not by ordinance, pursuant to its general land use and zoning authority, restricted the operation of short-term rentals, an operator may operate a short-term rental in the locality, subject to applicable law.”
In 2017 legislation patroned by Senator Norment provided localities with the ability to regulate short-term rentals on a local level. Localities made local decisions to regulate short-term rentals after that legislation that included ordinances, a registry and special use permits.
VML adopted a land use position that says the following: “Localities must maintain control of local land use decisions. Neither the state nor the federal government…impose requirements that weaken planning and land use functions. This includes all types of housing to include but not limited to short-term rentals.”
One tourist locality allows short-term rentals as a matter of right in some districts and special use permits in another. In the last 3 years they have an approval rating of 75 percent or more on the special use permits. Each of these special use permits required public notices and public hearings so the local citizens could have their voice heard on these specific short-term rentals.
Action Requested / Talking Points
The bill is scheduled to be heard in the Senate Local Government Committee at 9:00 a.m. on Monday, Feb. 28. Please contact the members of the committee (see below) and urge them to oppose HB1362. Inform the Senators:
- The ability for a locality to allow public input on a specific short-term rental location is powerful.
- This bill forces localities to make a land use decision or pre-emption will occur.
- This bill does not specify a time frame for their ordinance on short-term rentals.
- Current short-term rental laws are working.
Current GA Committee
|Lewis (Chair)||email@example.com||(804) 698-7506|
VML Contact: Michelle Gowdy, firstname.lastname@example.org
Encourage senators to pursue a study of issues related to land and zoning bill HB1088
As currently written, HB1088 (Leftwich) would alter the definition of subdivision in Virginia Code § 15.2-2201 to allow bona fide property line disputes by agreement without local review with some guard rails. In addition, if the division of land is subject to a suit of partition it also will not require local review if the parcels are not varied from minimum lot area, width, and frontage requirements by more than 20 percent.
Work on this bill is underway, and we thank Delegate Leftwich for that work. However, there are rumors of a study of this issue which VML would strongly support. We ask our members to help make sure that local authority and considerations are considered in this legislation by contacting the members of the Senate Local Government Committee (see below) before 9:00 a.m. on Monday, Feb. 28 to support a study!
Current GA Committee
|Lewis (Chair)||email@example.com||(804) 698-7506|
VML Contact: Michelle Gowdy, firstname.lastname@example.org
House and Senate budget amendments of special interest to localities
With just two weeks remaining, the 2022 Session of the Virginia General Assembly is headed into the final stretch with a major obligation remaining: negotiate and balance a $3 billion gap between the proposed state budgets that came out of the Senate and House of Delegates.
Conferees on behalf of the Senate and House will need to fully embody the spirit of compromise to send a balanced budget to Governor Youngkin, which is their responsibility under Virginia’s Constitution.
The negotiations will come down, first and foremost, to decisions about tax relief. Those decisions will then determine the state revenue available to pay for public services.
Below are links to view/download charts listing proposed amendments adopted by either the House or Senate (or both, in some cases) of interest to local governments due to their potential for significant impacts to local budgets if included in the enacted budget.
- View/Download 2022 (HB/SB 29) Budget Amendments >
- View/Download 2023-2024 (HB/SB 30) Budget Amendments >
Some of the amendments sought by VML and local government partners survived either whole or in part to be included in the House and Senate budget amendments. These include increases to local and regional jail per diems (approached differently by the House and Senate); increases to HB 599 – State Assistance to Local Law Enforcement (again, with different approaches by each chamber); funding for CSA administrative funding (Senate only); changes in language to allow for bus purchases (both House and Senate); and evaluation of city street conditions without using street maintenance payments for the study (Senate).
We will provide more targeted information about specific amendments of interest to local governments early next week so local officials and staff can follow up with their delegation members. VML staff will continue remind legislators of the importance of sustained funding for public services, and the importance of replacing local revenues lost due to state changes to sales taxes.
Next Wednesday, March 2nd, the Senate and House will reach their previously agreed-upon deadline to complete action on the budget proposed by the opposite chamber. For the General Assembly to end on time, budget conferees will then need to complete their negotiations and pass the compromise conference budget to send to Governor Youngkin.
Assuming the General Assembly adjourns within seven days of passing the budget, the Governor will have 30 days to review it and propose amendments, subject to the approval of the Reconvened Session of the General Assembly on April 27, 2022.
The Grocery Tax: How it started, where it’s going, and what it means
The General Assembly has two weeks left to complete its work on time, which makes it a great time to summarize legislators’ work on exempting groceries (a.k.a., food intended for home consumption) from sales taxes in Virginia.
At its original 1968 level, the sales tax in Virginia was 3 percent statewide, with a local option sales tax of 1 percent. Of the 3 percent state sales tax, two-thirds were dedicated to the growing state general fund and one-third was dedicated to localities for their public schools. The portion for public schools was to be distributed based not on where the sales taxes were collected but on the ratio of a locality’s school-aged population to the school-aged population of the state. This compromise formed the basis for Virginia’s sales tax and permitted every county and city to enact a local sales tax that they could use to fund general government. However, the General Assembly mandated that this sales tax could only be at a rate of 1 percent.
In 2022, the sales tax in most Virginia localities is 5.3 percent. Since 1968, the General Assembly has increased the statewide state sales tax rate only three times: in 1986, 2004, and 2013. In addition, the General Assembly has enacted regional sales taxes to fund regional transportation projects, and it has also granted local sales authority to a handful of localities to fund local school construction or promote local tourism.
As it slowly increased sales taxes over the last 50 years, the General Assembly, beginning in 1999, gradually exempted groceries from the enacted sales tax increases. In 1999, the General Assembly and Governor Gilmore reduced the state sales tax on groceries from 3.5 percent to 3 percent. And in 2005, the General Assembly and Governor Warner cut the state sales tax on groceries from 3 percent to 1.5 percent. This is where it stands today.
The local option sales tax, however, created in 1966 during the lifetime of Harry Byrd, Sr., has remained largely unchanged. The General Assembly has not increased local authority to levy a higher rate, nor has it exempted groceries from it.
VML has been closely following this topic because the expected cost of the full exemption of groceries from sales taxes would be about $700 million a year, about $500 million of which goes directly to local budgets to fund needs like public education and law enforcement.
What started as a half-dozen bills in January on this issue have been winnowed to two: HB90 (McNamara) and SB451 (Boysko). Every step of the way, the Virginia Municipal League and our members have educated legislators on the necessity for the state to fully replace local funding that would be lost by tinkering with this vital local revenue source. We have also encouraged legislators to codify the revenue replacement method in the Code of Virginia to better preserve the local funding in the future.
VML is grateful that, in their current forms, both bills would replace the revenue loss that they would bring about on the local level, excluding transportation funding, and would codify said method in the Code of Virginia.
As the final agreement is negotiated, VML asks the state to commit to reviewing and tracking the local revenue replacement distributions in the years ahead to protect this vital revenue stream for local governments, particularly for those in fiscal distress.
VML Contact: Carter Hutchinson, email@example.com
With time running out, House takes up marijuana legislation
The House of Delegates took testimony Thursday night for the first time this session on SB391 (Ebbin) dealing with the issue of marijuana retail sales as well as local regulations, taxation, and referendum requirements. VML has worked with the patron to protect local authority to hold a binding referendum to decide whether to allow marijuana businesses to operate locally, levy local taxes on business permitted under the bill, and regulate these businesses.
After taking testimony on the bill Thursday, the House committee took no action. The bill will be heard Monday morning at 9:00 a.m. in the House General Laws Subcommittee #5; the full General Laws Committee will meet immediately after to take a report from the subcommittee.
It is unclear if there will be sufficient time for this legislation to be heard by the necessary House committees prior to the March 1st deadline for each chamber’s committees to consider revenue bills. The timing bodes ill for the bill’s prospects though it could still return in some form as part of the budget.
It is important to keep in mind that if no legislation passes this year, possession, home cultivation, consumption, and gifting of marijuana will remain legal as will the purchase of medical marijuana from existing dispensaries. Although it will remain legal for adults to cultivate and consume marijuana, there will continue to be no legal or regulated sales outside of existing medical sales. This will also have the effect of denying localities a voice in whether to allow the much smaller medical market and affiliated businesses from operating in their communities.
We will continue to monitor this issue and local impacts as the General Assembly enters crunch time. The scheduled end of the session on March 12 looms large on this issue.
VML Contact: Mitchell Smiley, firstname.lastname@example.org
Education bills of note for local governments: Status updates
SB481 (McClellan) would codify the ability for local governing bodies and school boards to enter into a collaborative agreement to properly allocate any unexpended funds at the end of a fiscal year. Currently, any unexpended school funds at the end of the year are returned to the local governing body unless the locality chooses to allow the funds to remain with the school division. This legislation codifies the ability to enter into such agreements.
Status: SB481 failed to report out of the House Education Early Childhood Innovation Subcommittee.
HB472( McClellan) would grant the authority for every locality to impose a sale and use tax of up to one percent if approved via ordinance and referendum to be used solely for school construction. Only nine localities currently have this authority.
Status: SB472 failed to report out of the House Finance Subcommittee #3. VML will continue to work on this issue leading up to next session.
HB1290 (Hayes) would require all public bodies to report any known incidents that compromise and the threaten the security of the public body’s information technology systems to the Fusion Center within 24 hours from when the incident was discovered. Additionally, this legislation would create a work group.
Status: HB1290 passed out of the Senate Rules Committee.
SB471 (McClellan) would establish an annual open application process for Literary Fund loans that expands the maximum loan amount available to be used from $7.5 million to $25 million.
Status: SB471 has been docketed for the House Education Committee for Monday February 28th.
VML Contact: Josette Bulova, email@example.com
Local Government Legislation
Eminent Domain bills continue progress with issues (mostly) resolved
SB694 (Obenshain), in its current form, has one provision to be resolved. The bill requires the condemning locality to include the calendar date that any temporary construction easement will end. As previously noted in eNews, it is impossible for a city or town with larger street projects or other large projects, such as extending a water main to know the end date at the start of the project, when the work may take years to complete.
House Courts of Justice Subcommittee #2 will take up the bill Monday afternoon. VML is working to have an amendment made to provide that if the end date is not known, the government will certify that end date at such time that the date is known.
The three issues that were concerns in SB666 (Petersen) have largely been addressed. The patron agreed to amendments at the House Courts subcommittee meeting that would:
- Retain existing language that double compensation is prohibited.
- Retain the discretion of the court to order a separate trial for loss of profits or access.
- Ensure that temporary street closures will not give rise to claims for loss of profits or access.
On the third point, the bill provides that there can be no compensation for loss of profits or access if no land of the owner is taken and the impact of a loss of access is less than seven days. Existing case law provides that there is no claim for any damages if the property owner retains access through some other access point. Therefore, this last point should create little, if any, difficulties for local governments.
VML Contact: Mark Flynn, firstname.lastname@example.org
Local Pollution Control Equipment Tax Certification Legislation passes General Assembly
HB148 (Runion) cleared the House and Senate unanimously and as of February 24 is headed to the Governor’s desk for signature. This legislation will simplify the process of certifying that pollution control equipment is tax exempt by allowing the political subdivision to certify tax exempt status rather than relying on the Department of Environmental Quality as is currently required by the Code of Virginia.
This legislation will streamline the process for pollution control upgrades and improvement projects, a concept that was part of the 2022 VML Legislative Program approved by members approved at the annual business meeting in October. A companion bill, SB684 (Mason), is awaiting final action in the House of Delegates.
VML Contact: Mitchell Smiley, email@example.com
Emergency Broadband Benefit program transition period ends on March 1, 2022
The below notice is from the Federal Communications Commission:
On March 1, 2022, most legacy Emergency Broadband Benefit households should be automatically transitioned to the Affordable Connectivity Program (ACP). Households that need to take action to remain enrolled in the ACP will have been contacted by USAC, the program administrator, or their provider.
After the transition period ends on March 1, 2022, the monthly discount for all legacy EBB participants not located on qualifying Tribal lands will be reduced to $30. Consumers should contact their provider if they are concerned about a possible increase in their monthly service bill or are interested in changing to a different service plan.
For our 2022 “Virginia You Love” magazine issue this summer we want our readers to tell us their perfect place to have fun outside. It could be a favorite hiking trail or the stadium bleachers of the hometown ball team. Perhaps you can be found in a mountain lake with family or at the dog park with your furry friend. Maybe you like the challenges of long fairways and fast greens or the peace and quiet of a bench under a shady tree. Vita courses, ropes courses, pump tracks, brewery decks…Wherever, whatever, we want to hear about it!
Have your place featured in our magazine!
If you tell us about your favorite place for outdoor fun, we will put it on the list of possible places to feature in the July/August issue of Virginia Town & City. You can nominate any place you like…just so long as it’s outdoors and in Virginia.
It’s super easy to participate
Learn more and complete the short online survey here >.
VML Contact: Manuel Timbreza, firstname.lastname@example.org
The Virginia Municipal League (VML) invites all eligible Virginia 7th Graders to join its “If I were Mayor” essay contest.
Regional winners selected from around the state will each receive a $150 gift card and a plaque. One statewide winner chosen from the regional winners will receive a $250 gift card and a plaque. The runner-up from the region that receives the statewide award will become that region’s winner.
Winning essays will be featured in the May issue of VML’s magazine Virginia Town & City.
VML Contact: Rob Bullington, email@example.com