The Virginia Beach City Council is usually in agreement by now on what its budget should look like for the next fiscal year, but this year’s process is far from normal thanks to the global coronavirus pandemic.
And next week a divided council is set to vote on a $2 billion budget that is still very much up in the air.
The controversy involves a budget proposed by Acting City Manager Tom Leahy. Some of the council members say it doesn’t deliver enough tax relief and could underestimate the financial impact the coronavirus will have on city revenue.
City staff have anticipated a $67.3 million loss in revenue due to coronavirus.
“Every self-respecting Beach resident should be outraged at the total lack of empathy and indifference expressed by the staff, and the failure of a Council majority to direct a budget that provides tax relief,” Councilman John Moss wrote last week on Facebook, explaining he he would not vote for a budget that doesn’t deliver tax relief.
He would like to lower the real estate tax rate and eliminate a previously approved stormwater fee increase to help families that are struggling due to the pandemic.
“We are just one Council vote away from directing the City Manager with explicit guidance to deliver a budget with tax relief.”
The council will meet on Tuesday and Thursday to try to get all members on the same page.
Mayor Bobby Dyer, who is serving his 16th year as a council member, said he can’t recall a time when the budget was in flux so close to the vote. He said the council will likely modify the budget several times throughout the year since it is uncertain how severely the pandemic will hurt the city’s revenue.
“A couple of months ago, we had a budget we could have had consensus on,” Dyer said. “Then the virus hit. The whole landscape totally changed. There are so many unknowns now.”
In the Hampton Roads region, Virginia Beach has had the most reported cases of coronavirus infections. As of Monday, 439 people in the city had tested positive or are likely to test positive for the disease, according to the Virginia Department of Health.
In addition to Moss, tax relief is on the minds of council members Guy Tower, Jessica Abbott, Aaron Rouse and Sabrina Wooten. They, however, haven’t agreed on what kind.
Abbott said she’d like to give people a break on real estate and personal property taxes, while also budgeting for a worse case scenario now. If leftover money is available, the council could appropriate that money throughout the year.
“Nobody has a crystal ball,” Abbott said. “But I would rather be cautious and wrong.”
Tower said he is concerned the city could face a recession worse than 2009. He fears city staff have underestimated the amount of revenue the city will lose as a result of the current crisis. He would prefer not to approve across the board tax cuts, but he would like the city to help out businesses and residents who have been or will be hurt by the pandemic.
“I do think we could offer more tax relief to some of the small businesses that have been absolutely killed by this thing,” Tower said. “The cost of replacing those businesses is much greater than the cost of keeping them going now.”
Like Gov. Ralph Northam, Dyer has assembled his own economic group to advise him on the safest and best ways to reopen the economy when the governor gives the green light. He would like to see beaches open by Memorial Day to help the struggling tourism industry.
“It is time to discuss plans and phases for revitalizing our economy, getting people back to work and restoring the quality of life of Virginia Beach,” he said.
Alissa Skelton, 757-222-5155, alissa.skelton@pilotonline.com
