Piercing the Veil: Landes’ Bill Shines a Light on the Revenue Sharing Agreement

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Bill Schrader. Photo: Lisa Martin.

After a scuttled attempt last year to pass a budget amendment that would have altered the terms of long-standing revenue-sharing agreements between cities and counties in the state, Virginia House Delegate Steven Landes stepped once again into the fray this year to offer a new bill designed to undo the permanence of the agreements. Though his bill was passed by the House and is now headed for Senate approval, most of its original punch was removed before passage.

Delegate Steve Landes

The revenue-sharing agreement (RSA) between Charlottesville and Albemarle was inked in 1982, halting the city’s continued annexation of county land in exchange for annual payments of a portion of county property tax revenue. More than $310 million has been paid to the city since then, and in light of a state moratorium on annexations in effect since 1987, many county residents would like to see the agreement torn up, or at least renegotiated.

Delegate Landes, who represents western Albemarle and sections of Augusta and Rockingham counties, sponsored legislation in January that allowed RSAs that have been in effect for more than 10 years to be renegotiated if requested by either party, and provided that a majority vote by the governing body of either locality could end the agreement. More than 50 city/county localities across Virginia currently have some type of RSA in place, and this change could have effectively allowed parties to dissolve existing contracts.

Ann Mallek

Ann Mallek, county Board of Supervisors Chair and representative for the White Hall District, wrote an email to the Appropriations subcommittee in strong support of the bill. In it, she summarized the original intent of the agreement and the county’s ballooning payments over the years, juxtaposed against the city’s growth “from a languishing, small impoverished burg to a bustling economic center with this year a $9m surplus.” Citizens, she said, are growing frustrated with the agreement signed more than a generation ago.

“[The RSA] was crafted in different times . . . and should be able to be discussed and changed if the character of those times has changed significantly,” wrote Mallek. “This would mean a lot to the taxpayers of the County.”

In the end, however, the strongest requirements in the bill were jettisoned in the subcommittee, erasing any path to renegotiation of the agreement and leaving only a mild alteration of “reporting” requirements. The bill as passed requires an annual report from the locality that received payments that states (a) how much money was transferred and (b) how the money was spent. The parties to any RSA in effect for longer than 10 years with greater than $5 million in annual payments must also meet to discuss “anticipated future plans for economic growth in the localities.”

Bill Schrader, Crozet resident and long-time critic of the RSA, was disappointed by the outcome. “Delegate Landes should get a pat on the back for submitting the original bill, as should Ann Mallek for supporting it,” said Schrader. “However, the bill that was ultimately passed has no real teeth. It requests a meeting between the parties that treats revenue sharing as an economic plan for the city, rather than as a burden on county citizens.”

The new reporting requirement will, at the very least, illuminate for residents the dollar amount of the payment each year, which in the past has been buried in the city’s general fund and difficult to tease out based on publicly available data. As well, an annual discussion of how the funds will be spent may prod the city to dedicate the payments to true city/county projects. The BOS recently agreed to send another email to General Assembly members supporting the bill’s final passage.

“This is the second year I have worked to address the revenue-sharing agreement between Albemarle County and the City of Charlottesville,” said Delegate Landes in a statement. “Last year, the language as drawn in the budget amendment proved to be too broad, so I withdrew the amendment. I hope House Bill 1148 will be able to begin the dialogue on the inequity of the revenue-sharing agreement between the City of Charlottesville and Albemarle County.”

Schrader will be taking a wait-and-see approach. “We as county citizens will have to ask County Executive Jeffrey Richardson for some leadership in these meetings,” he said. “He’s new to the job and is not tied to those old relationships; let’s see what he does. I hope the Supervisors ensure that the meetings are open to the public so we can be a part of these discussions.”

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