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School Construction Financing Bills Head to House Floor – Contact Your Delegates Now!

On February 7, the House Finance Committee reported with a substitute HB 805 (Rasoul) on a bipartisan vote of 13-8. As previously reported, this bill would permit any county or city to impose an additional local sales and use tax of up to 1 percent, if initiated by a resolution of the local governing body and approved by voters at a local referendum. The revenues of such a local tax would be used solely for capital projects for the construction or renovation of schools. Any tax imposed shall expire when the costs for capital projects are to be repaid and shall not be more than 20 years after the date of the resolution passed. Currently, this authority is limited to the qualifying localities of Charlotte, Gloucester, Halifax, Henry, Mecklenburg, Northampton, Patrick, and Pittsylvania Counties and the City of Danville.

HB 805 heads to the full House of Delegates where it could be heard as early as the afternoon of February 9.

ACTION REQUIRED – Contact your Delegates (2-Part Email List – Delegates 1 | Delegates 2) now to urge them to support HB 805.

HB 805 incorporates various “standalone” bills before the committee, including HB 60 (Wright) and HB 193 (Cole) for Prince Edward County and Stafford County respectively. The substitute also allows localities that choose to exercise this authority, if approved by voter referendum, to use the revenues from such authority for school capital debt payments.

The Senate version of the bill, SB 14 (McPike), passed the Senate on a bipartisan vote of 27-13 and now awaits assignment to committee in the House. Both versions of the bill will need to be conformed before passage.

VACo and numerous other local government and K-12 advocates have testified in favor of the bill. VACo thanks its members and those who advocated for the bill.

Please review this video and one-pager for information on the desperate need for more school construction financing options.

KEY POINTS

  • Funding for school construction and renovation is one of the biggest concerns and responsibilities of local governments in the Commonwealth and has been almost solely a local responsibility for decades. The condition of the facilities in which children are educated has a direct impact on their ability to learn.
  • Many localities face significant challenges in raising sufficient funds to undertake these projects. These challenges include over-reliance on real property taxes to generate revenue, which can have vastly different yields depending on the locality and disproportionately burden a subset of taxpayers within a jurisdiction. This raises concerns over equity and diversity of revenues.
  • This legislation was a unanimous recommendation by the Commission on School Construction and Modernization.
  • This bill is about parity for local governments, giving all counties the same authority currently given to nine localities.
  • This bill is NOT a tax increase. It would merely create a local option and another tool in the toolbox of local government, which would only be enacted by local referendum.

KEY CONTACTS

VACo Contact: Jeremy R. Bennett

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