Richmond’s City Council on Monday backed Mayor Levar Stoney’s plan to finance, by way of a meals tax increase, $150 million for school construction and improvements.
The council backed the plan on a 7-2 vote about 11 p.m. Monday. The 1.5 percentage point increase — from 6 percent on each dollar spent at a city eatery to 7.5 percent — will take effect July 1. The hike will increase the city’s combined sales and meals tax rate from 11.3 percent to 12.8 percent.
The tax increase is projected to generate $9.1 million annually, allowing the city to borrow $150 million over the next five years. The money will partially fund a School Board-endorsed plan to build five new schools and renovate two others.
Supporting the tax hike were 1st District Councilman Andreas Addison, Council President Chris Hilbert of the 3rd District, 5th District Councilman Parker Agelasto, 6th District Councilwoman Ellen Robertson, Council Vice President Cynthia Newbille of the 7th District, 8th District Councilwoman Reva Trammell and 9th District Councilman Michael Jones.
“I’m serious that this has to be used for schools,” Hilbert said. “It can’t be used for any other purpose. Our kids deserve this.” He added later, before casting his vote. “I’ll admit, I’ve been here for 14 years. I’ve been delaying. I’m tired of delaying. I’m not going to do it for another second.”
Opposing the plan were 2nd District Councilwoman Kimberly Gray and 4th District Councilwoman Kristen Larson.
“I am not in support of this tax increase and its flawed and rushed process,” Gray said. “I call this taxation without preparation.”
Gray called the facilities plan the tax increase will partially fund “half-baked.” She also criticized Stoney, saying he had not presented or discussed alternate funding options with the council through his education compact, as promised.
Stoney said in a statement after the vote: “Tonight, the City of Richmond sent a strong message to its students that it is no longer willing to kick the can down the road when it comes to providing them with modern, safe and healthy environments in which to learn. This is just the first big step in what will be many more steps to improve our schools for our children, and for the generations of Richmond Public School students to come. After decades of telling them to wait, tonight we put them first.”
Stoney’s statement continued: “To the restaurateurs who supported this proposal and those who had reservations about it, you are part of what makes Richmond a great place to live, work and play. I will continue to be a champion for you, and I look forward to finding ways that we can make it easier for you to do business and continue to thrive.”
By city government standards, Stoney’s proposal has moved at warp speed since its formal introduction at a special council meeting two weeks ago. That’s due, in no small part, to the mayor’s insistence that the council approve the plan at the earliest opportunity.
Some on the council sought to delay the vote a month to gather more public input, propose amendments to the mayor’s plan and develop alternate proposals.
Before Monday’s final vote, the council rejected an amendment to the mayor’s plan put forth by Larson that would have included a sunset provision for the tax hike in July 2023.
“Maybe a sunset isn’t the answer, but I still implore my colleagues to give this more time,” Larson said.
Amending the tax plan would have required delaying the final vote on it to a later date. The administration opposed the addition of a sunset provision.
“If (the tax hike) passes with amendment or without it, council has the authority to repeal the tax at any time,” Hilbert said.
Stoney has pushed his approach aggressively, reiterating that city leaders must act to address the school system’s “emergency needs.” Capital costs have ballooned in recent years, the result of decades of neglected maintenance.
A School Board-endorsed plan says it will cost more than $800 million in the next two decades to overhaul the division’s portfolio, including $224.8 million in the next five years.
It calls for the construction of five new schools: three south of the James River — a 1,000-student E.S.H. Greene Elementary, a 1,500-student Elkhardt-Thompson Middle, a 2,000-student George Wythe High — and two in the East End — a 650-student George Mason Elementary and a 650-student Woodville Elementary. It also calls for the renovation of Overby-Sheppard Elementary and J.L. Francis Elementary.
The school system will face a shortfall of $74.8 million under Stoney’s funding proposal that may require the School Board to revise its immediate plan. Even so, School Board leaders have heralded the mayor’s plan, as has schools Superintendent Jason Kamras.
Robertson, the 6th District representative, said the council couldn’t wait another budget cycle to move forward, even if the proposal on the table didn’t meet the full amount the School Board has requested. Others who voted in support of the plan said they were committed to finding additional funding for RPS’ capital costs.
“We’ve got to find ways to fund the things we know we need for the city,” Robertson said. “This council’s commitments are true. The transparency you’re looking for, you’ll see.”
Despite the gap, supporters who spoke during a public hearing at Monday’s meeting said the mayor’s plan offered a long-awaited start to address the problem. Some held signs that read “Vote yes and find the rest.”
“Some of the loaf is better than none of the loaf,” said David Jones, who was one of about 30 people who spoke in support of the plan.
Opponents questioned why no alternative revenue sources to fund school construction were put forward for consideration along with the hike. Some also raised concerns that the city will misuse the funds, and they wouldn’t ultimately help the schools. The mayor has said the money will be held in a special reserve.
Johnny Walker, a 4th District resident and member of the Richmond Crusade for Voters, asked why the council was contemplating a plan hinging on a tax increase against the will of 85 percent of voters who voted for a ballot measure to modernize public schools without one.
“What we’re ask is this body honor the will of the people,” Walker said, asking the council to delay the vote.
Stoney has said he will not propose other tax increases to fill the gap, though the council members could chart their own course during the upcoming budget discussions.
The mayor will present his budget to the council in early March.