HJR 432

Commission on the Condition and Future of Virginia's Cities

October 6, 1998, Roanoke

At the third meeting of the commission, members received presentations from various individuals regarding the plight of cities in the Roanoke region. The Roanoke City vice mayor noted that Roanoke would receive approximately one-half million dollars in additional state funding for local law-enforcement purposes if the old formula for 599 funding had not been frozen by the General Assembly.

The Roanoke city manager stated that Virginia's adherence to the Dillon Rule (localities have only those powers which are expressly granted, implied in express powers, or essential) limits what cities can do to address their problems. In particular, the city manager mentioned the problems associated with abandoned and neglected buildings and stated that the blight provisions are difficult to enforce. He also said that the current $25 cap on the fee that cities may charge to register vacant buildings is inadequate to be used as an enforcement tool. He stated that the fee ceiling should be raised to at least $500. Finally, the city manager described the difficulty that the city has in returning vacant tax delinquent property to the tax rolls when the liens on the property may exceed the value of the property, especially when demolition costs are considered. He stated that this may be an area where cities need additional authority in order to waive city liens.

The president of the Roanoke Regional Chamber of Commerce stressed the importance of the state's living up to its commitments regarding 599 funding and also emphasized full funding of the Regional Competitiveness Act. The director of community development for the Fifth Planning District Commission also addressed the commission and presented statistics indicating that cities in the Roanoke region are facing greater fiscal stress than the region as a whole.

The director of fiscal policy for the Virginia Municipal League also addressed the commission. She pointed out that the tax on real property accounts for over 43 percent of all local revenue and stated that the entire tax structure should be examined in an attempt to give localities greater flexibility in how they raise revenue. She also emphasized that localities provide 60 percent of the funding for education, although the state constitution provides that education is a state responsibility. She stated that the issue of tax authority versus service responsibility deserves close examination. With regard to 599 funding, she disclosed that localities have lost over $600 million due to the funding freeze.

Other speakers included Lynchburg's mayor, who emphasized the negative impacts of the annexation moratorium upon cities, and a member of Richmond City Council, who emphasized that localities stand to lose revenue from current federal legislation that would exempt certain Internet and electronic commerce from taxation.

The Honorable Thomas W. Moss, Jr., Chairman
Legislative Services contact: Jeffrey F. Sharp