Item Coversheet

Spotsylvania County
Board of Supervisors Agenda
Executive Summary



Meeting Date:
April 13, 2021
Title:
Public Hearing to Consider Increase in Meals Tax Rate from 4% to 5.5%
Type:
Action, Public Hearing, Ordinance
Agenda Title:
Public Hearing to Consider Increase in Meals Tax Rate from 4% to 5.5%
Recommendation:

Staff recommends that the Board holds a public hearing to gather citizen comment on the proposed increase in the Meals Tax rate from the current 4% to 5.5%.

Summary:

The County Administrator’s Recommended Budget proposes increasing the Meals Tax rate from the current 4% to 5.5%.  This increase is expected to generate $2,550,000 in new tax revenue to support community services within the General Fund budget. 

 

The Meals Tax is charged to the individual purchasing a meal and is then held in trust by the vendor until the tax is due to the County.  It is not a tax to businesses.  The purchaser of a typical $10 lunch would pay 15 cents more per lunch with the proposed increase from 4% to 5.5%.   

 

The draft Meals Tax ordinance including the changes necessary to exact the proposed increase is attached.  Also attached is the public hearing advertisement notice that appeared in the Free Lance-Star on March 30 and April 6, 2021.

 

If approved by the Board, the effective date of the increase would be July 1, 2021.

Financial Impact:
The proposed increase in the Meals Tax rate from 4% to 5.5% is expected to generate $2,550,000 in new tax revenue to support community services within the General Fund budget. 
Staff Contacts:
Bonnie Jewell, Assistant County Administrator/Chief Financial Officer
Consequence of Denial/Inaction:
If the Board were to deny this proposal, revenue planned in the FY 2022 Budget would decrease by $2,550,000 and changes to the budget would be necessary.
ATTACHMENTS:
File NameDescriptionType
Ord._No._21-91_-_Sec._21-252-_Meals_Tax.pdfDRAFT Meals Tax Ordinance Ordinance
Meals_Tax_and_Transient_Occupancy_Notices_FLS_March_30_Edition.pdfPublic Hearing AdvertisementBackup Material