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March 05, 2008

Chairman Boyd calls for renegotiation of City-County revenue sharing agreement

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20080305bosboard The Chairman of the Albemarle County Board of Supervisors says it is time for the County to renegotiate the revenue sharing agreement with the City. At the end of the Board’s day meeting on March 5, 2008, Ken Boyd (Rivanna) called the agreement unfair. While his request to discuss the issue in closed session at a later date was accepted, three members of the Board expressed support for continuing the agreement.

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The agreement ended Charlottesville’s annexation of County land and was approved by County voters in a referendum on May 18, 1982.  Soon after it went into effect, the General Assembly placed a moratorium on further annexations in Virginia. Charlottesville will receive $13.6 million in revenue sharing funds from the County in FY2009.

A recent article in the Daily Progress prompted Boyd to raise the issue at this time. He said he has often heard people say the agreement is a good deal for the County taxpayers because the agreement allows the County to bring in property taxes that otherwise would have gone to the City.  Boyd disagrees.

“We’re also maintaining the roads, the Master Planning process, the police, the emergency services, all of that for this area, which is a great expense to us that we’re already doing that we wouldn’t be doing if the City had annexed that property because we wouldn’t have that  expense, they would,” Boyd said.
Boyd said he read through the agreement, which he said was put into place to cover some of the costs that the County’s increasing urbanization was placing on the City.

“One thing that’s changed in the last 26 years is that we’ve become urbanized, and we’re incurring a lot of those same costs, but we’re still having to pay that to the City,” he added.  Boyd also pointed out that the County has paid $600,000 a year for the City to provide fire service to some areas of the County, and that the City keeps asking the County to do more to promote affordable housing.

Though he was speaking publicly, Boyd went on to suggest several ways he could get the County to enter into renegotiations. Because the agreement is a contract, both sides would have to agree to amend the terms. He suggested the County could withhold some of its payment, citing the City’s recent withholding of payment to the Rivanna Solid Waste Authority due to a disagreement over cost allocation of landfill transfer services. Boyd also suggested that the Board that approved the agreement might not have had the authority to do so.

“I think it would be a bit draconian for us to hold back the payment on the City, but I do think we could look at the potential of capping this year’s payment,” Boyd said.

But Supervisors Sally Thomas (Samuel Miller) and Dennis Rooker (Jack Jouett) pointed out that the voter’s passed the agreement in a referendum, ensuring its legality. Rooker also cautioned about discussing the legality of the contract outside of a closed session.

Boyd agreed, but said the revenue sharing agreement would continue to rise. “This is becoming a huge expense for the County, and we have got to look at the unfairness of it,” he said.

Rooker said the City would take legal action quickly if the County withheld money, but said he would be willing to explore the strengths and weaknesses of the contract in closed session. County Attorney Larry
Davis confirmed Rooker’s suspicion that a second referendum would also be needed.

Slutzky encouraged his fellow Supervisors to stop discussing the legalities until a closed session could be held,  but made the observation that revenue sharing means the County has an effective tax rate (this year) of 58 cents per $100 of assessed property. According to the formula that calculates the payment, ten cents per $100 goes to the County.

“Let’s face it – we bought them off. We’ll give you money rather than have you annex us… I’m not convinced the County citizens are all necessarily worse off by virtue of this agreement,” Slutzky said
Thomas, who said she worked on a  committee that came up with the idea, repeated a comment she made earlier this week on WINA’s Charlottesville Live program, in which she said the County benefited from having a healthy Charlottesville, something made possible in part by the agreement.

Slutzky tried to explain what he saw as the rationale behind the agreement: “ As we urbanize, the goal as I understood it, was that we’re likely to impose by virtue of our urbanization cost burdens on [the City] to address our growth,” he said. When Boyd wanted an example, Slutzky said County residents take City roads to get to work. Boyd questioned whether the County should have to supplement the City’s economic development.  Supervisor Lindsay Dorrier (Scottsville) said County residents should have some say over how the City spends the money.

“It’s taxation without representation,” Dorrier said. “An agreement’s not forever. Even the Constitution can be amended.”

Before the discussion ended, Slutzky pointed out that the City and County collaborate in many different areas, including the proposed regional transportation authority, the Rivanna Water Sewer Authority, and so on.

Sean Tubbs

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