Data centers could provide an economic benefit to the county. Photo by Mercia Hobson.
The possibility of meals tax looms in Fairfax County.
What are the possible solutions to reduce the growing tax burden on homeowners?
On Sept. 10 at 9:30 a.m. a Full Board of Supervisors Meeting is scheduled, including a public hearing on the proposed data center zoning amendment, meant to strengthen the current provisions for data centers.
A week later, on Sept. 17, the board will hear a staff report by the County Executive on a proposed meals tax. The board will not need a public vote for approval. The Virginia General Assembly passed l§ 58.1-3833 County food and beverage tax in 2020. It allows counties to implement a meals tax of up to 6 percent without a referendum. Many jurisdictions in Northern Virginia have a meals tax, including Town of Herndon and Town of Vienna, cities of Fairfax and Falls Church, and Prince William and Arlinton have a meals tax.
In the meantime, Senate Bill 625, the ‘Tysons Casino Bill’ introduced by Sen. Dave Marsden (D-Fairfax), is held over to 2025, which is sooner than we think. Could these three measures create a much-needed revenue stream for Fairfax County?
County supervisors are aware of the “projected shortfall based on identified county needs and equal schools growth” of $363.63 million for FY 2026. This was forecast at the Nov. 28, 2023 Budget Policy Committee Meeting and stated in the Multi-Year Budget – FY 2025 and FY 2026.
“Disbursement requirements continue to increase because of the factors that drive expenses in the County and Fairfax County Public Schools (FCPS) budgets, such as employee compensation increases, student demographic changes, maintaining current service levels, and the need to address the priorities in the community. Thus, it is not anticipated that projected revenues in FY 2026 will be sufficient to cover expected spending increases,” the multi-year budget document states. “Balancing the FY 2026 budget will require difficult decisions regarding which priorities to fund, which to exclude or delay, and whether programmatic reductions should be made in other areas or revenue enhancements should be considered.”
Zoning Ordinance Amendment
On Sept. 10, the Board will consider “to amend the Zoning Ordinance to strengthen the current provisions for data centers while recognizing that data centers provide an economic benefit to the County,” according to the Joint Board Matter with Chairman Jeff McKay and Supervisor Andres Jimenes, by Kathy L. Smith, Sully District dated March 19, 2024 .
The Sept. 10 meeting's online Draft Agenda, reports that the data center public hearing is the final of 12 public hearings that day and is scheduled at 4:30 p.m. County staff will provide a presentation on the proposed data center amendment.
A regulatory oversight led to the 12 public hearings on Sept. 10. Public hearings held during the July 16 meeting, including the one on data centers, are scheduled to be reheard on Sept. 10. The oversight also postponed all public hearings scheduled for the July 30 Board of Supervisors meeting. Those hearings are also rescheduled to Sept. 10.
According to a spokesperson for Fairfax County, the new public hearing advertisement requirements effective July 1 is Sect. 15.2-2204 of the Code of Virginia. It includes the requirements for the advertisement of plans, ordinances, etc. § 15.2-2204. Advertisement of plans, ordinances, etc.; joint public hearings; written notice of certain amendments (virginia.gov). Two notices are required, the first being no more than 28 days before and the second no less than seven days before the date of the meeting.
As for the testimony process, any testimony provided on July 16 will be included in the record for the Board's consideration, but all persons are invited to testify on Sept. 10 if they wish. Members of the public who testified at any of the four public hearings on July 16, can add themselves to the Speakers List for that Public Hearing on Sept. 10; resubmit their previous written testimony and modify the date to Sept. 10, or present new written testimony.
Instead of appearing in person at the Sept. 10 hearing, they can submit a YouTube video to be shown at the meeting, either using the July 16 YouTube video of themselves testifying, if accessible, or a different YouTube video.
On Sept. 17, the board will hear a report with all options for revenue diversification, including a possible meals tax. The county executive will present his report during the Board of Supervisors Budget Policy Committee at 3 p.m.
According to state code, not only will the tax be on food and beverages sold for human consumption, by a restaurant, the term "beverage" means alcoholic beverages as defined in § 4.1-100 and nonalcoholic beverages served as part of a meal. Grocery stores and convenience stores selling prepared foods ready for human consumption at a delicatessen counter will also be subject to the tax.
Advocacy groups, including No Food Tax are urging voters to tell their supervisors to vote no on the meals tax. This is not the first time the Fairfax County Board of Supervisors is seeking to introduce a meals tax. They did so in 2014 and again in 2016.
During the Nov. 28, 2023 Budget Policy Committee Meeting, School Board Member Ricardy Anderson said Richmond is not fully funding Fairfax County Public Schools according to a report by the Joint Legislative Audit and Review Commission (JLARC). Instead the burden to do so comes from local dollars, mostly the residential real estate tax. Anderson said she wanted to discuss the option of a meals tax.
“We do know as of that time, almost every jurisdiction had either 2.5 percent all the way up to 10 percent in DC, which is a meals tax. We can't continue to fund our schools on the back of our homeowners. So I would definitely appreciate in earnest return to that conversation,” Anderson said.
The third item is Senate Bill 675, introduced by Marsden. At the Feb. 1 meeting of the Virginia Senate Subcommittee on Resources,Marsden said a casino would help Fairfax County’s loss of revenue from its Tysons commercial real estate, given the high number of vacancies.
Marden identified Comstock Holding Companies as the developer who seeks to build a resort-style casino with a hotel and entertainment complex in Tysons on land it owns near the Metro Silver Line station.
Should the Virginia legislature approve SB-675 and the bill be enacted, the Fairfax County Board of Supervisors would have the authority to place a referendum on future ballots, granting voters the authority to decide whether to go forward with a casino in Tysons.
The Virginia Senate Subcommittee on Resources voted 4-0 during the 2024 legislative session on Feb. 1 to “hold over” the bill to the 2025 General Assembly session for reconsideration after more study. The state’s Joint Legislative and Audit Review Commission (JLARC) completed a casino study in 2019. Sen. Creigh Deeds, who questioned the viability of a casino in Fairfax County, urged the completion of an updated JLARC review before a public referendum.
The Senators heard testimony against a casino from elected Fairfax County and local officials. Supervisor Walter Alcorn said approximately one-third of the locations in SB 675 could be in the Hunter Mill district. He opposed a casino there. Linda Colbert, mayor of the Town of Vienna, testified that the town had been a part of the Tysons Comp Plan and strategic plan, and a casino was never mentioned. She said, “Town of Vienna residents are just really, really strongly against this.”
Board Chair Jeff McKay (D-At-Large) sent a letter to the general assembly saying that the county had not been “substantively involved in the development of the casino concept envisioned by stakeholders and the patron of the legislation.”
The Town of Vienna issued a statement saying that a casino anywhere “would hurt the county’s economic bottom line, harm local businesses, increase gridlock and public safety problems, lower property values, and encourage risky behaviors, while forever changing the character of our community.“
The NO Casino Coalition continues circulating its petition, urging the public to let Fairfax County Board Supervisors know it opposes a casino referendum. Its partner organizations include the Great Falls Citizens Association, Greater Tysons Citizens Coalition, McLean Citizens Association, Reston Citizens Association, Town of Vienna (Council), and Sully District Council of Civic Associations (issued with Western Fairfax).