City Council President Kristen Nye joined Mayor Levar Stoney in announcing the rebate at Monday’s press conference at City Hall. (Jonathan Spiers photo)
Amid what’s become a more-heated debate than usual over whether to reduce Richmond’s real estate tax rate, City Council is mulling proposals that now include a 4-cent tax rebate for all property owners and more targeted tax relief for low-income and older residents.
In a press conference Monday, Mayor Levar Stoney and Council President Kristen Nye announced the proposed rebate and two new relief programs that city administrators recommend over Councilmember Reva Trammell’s calls to reduce the rate, which stands at $1.20 per $100 of assessed value.
Reva Trammell
Weeks earlier, in a committee meeting that at times turned testy, Trammell pushed for a 4-cent reduction to the rate, which she noted has remained unchanged since 2009. Trammell argues that a rate cut is needed to help offset real estate assessments that have risen in that time and outpaced many residents’ abilities to afford their rents and mortgages.
Councilmembers Ellen Robertson and Ann-Frances Lambert have since added their names to Trammell’s proposal, which Nye had countered with a proposal to maintain the current tax rate in favor of a rebate and targeted tax relief. She and administrators maintain that an across-the-board rate cut would benefit the city’s highest-assessed property owners most, rather than those who need the relief most.
Both proposals were continued to this month’s meeting of council’s Finance and Economic Development Standing Committee, which is slated to resume the rate debate Thursday.
But on Monday, Nye and Stoney announced the rebate proposal and additional relief programs, which were detailed to councilmembers in a separate committee meeting later in the day.
The onetime 4-cent rebate would effectively return $16 million in surplus real estate taxes from last fiscal year to taxpayers who paid them. Rebate checks would be mailed to property owners in February.
The relief programs proposed, collectively called RVA Stay, include a gap grant pilot program in which low-income residents who spend more than 30 percent of their income on housing costs can receive up to $200 a month for six months in assistance. The grants would be available to both homeowners and renters.
Also proposed is the Richmond Freeze Program, in which homeowners who are 65 years or older or permanently disabled would be exempt from real estate tax increases. Their current tax bill would be frozen based on their home’s prior year assessment.
In announcing the proposals, Nye credited Trammell, who attended the press conference, for applying the pressure that caused them to be produced.
“I’d like to say ‘thank you’ to Councilwoman Trammell for bringing forward the $1.16 paper, because if she didn’t do that, I don’t think we’d be having this discussion and looking at all these options,” Nye said. Other councilmembers gave similar kudos to Trammell at Monday’s committee meeting.
However, following the announcement, Trammell maintained that a tax cut, not a rebate, is what residents need to not be priced out of the city. She said she’d continue to push for the rate reduction, and did so in the meeting.
Stating that the last rate reduction in 2009 dropped the rate by 3 cents, Trammell said in Monday’s meeting, “I’m only asking for 4.”
The rebate and targeted tax relief proposals were detailed during a council committee meeting Monday. (Screenshot)
The rate debate has been recurring in recent years, fueled by the reassessments that are realized this time of year but also a state law that triggers a “roll back” rate to offset annual increases to assessments of 1 percent or more. If council wants to maintain the city’s previous tax rate, it must approve an increase from the roll-back rate, hence Nye’s and Trammell’s proposals.
The city also is currently working to align its assessment calendar so it falls during the spring, when council is preparing the annual budget. Doing so, administrators and councilmembers say, would facilitate the tax rate discussion so that any adjustments could be worked into the budget.
Mayor Stoney said changing the tax rate now would not only cut a $3.2 million hole in the current budget, but also have the effect of removing $200 million out of the city’s multiyear capital improvement plan and compromise collective-bargaining agreements that council has finalized with firefighters, police and other city employees.
While he disagrees with reducing the rate, Stoney said at Monday’s press conference, “I think debating these fiscal questions are good discussions to have at this moment, particularly when we know a number of our residents are experiencing the burden of rising costs.”
Monday’s announcement cited statistics from the 2023 American Community Survey, which reported that over a quarter of Richmond renters, or approximately 43,000, are spending more than half of their income on housing. Nearly twice that are spending 30% or more of their income on rent, while the average residential assessment in 2023 was about $340,000, according to the survey.
Council has provided tax rebates before. Two years ago, it approved a 5-cent rebate as an alternative to previously proposed reductions to the tax rate. That rebate amounted to an $18 million surplus from the 2022 fiscal year.