State Senate Majority Leader Thomas Norment Jr.’s sales tax bill to “promote tourism” has cleared the General Assembly. With support split among the local delegation, it heads to the governor’s office.
If signed by Democratic Gov. Ralph Northam, the bill submitted by Norment, R-James City County, will raise the sales tax in the City of Williamsburg, and James City and York counties by one percentage point.
“It really isn’t that complicated,” Norment said. “Currently, we don’t have enough money in the Williamsburg, James City County, and York County marketplace to promote us as a destination.”
Half of the revenue from the increase would be directed to a tourism council in the Greater Williamsburg Chamber and Tourism Alliance, while the other half of the revenue would be given directly back to the localities the tax was collected from.
If signed into law, the proposal will eliminate the $2 transient occupancy tax, a tax collected for nightly stays in hotels, motels, and bed and breakfasts in Greater Williamsburg.
The proposal initially excluded taxing meals, but in its final form will tax food “for human consumption,” according to the updated fiscal impact statement.
To take effect, the City of Williamsburg would need to roll back its tourism tax increase on meals, lodging, and admission tickets. That tax was passed last year, with the expectation that it will take effect on July 1, if it is not repealed.
While the three area localities had requested increased funding for tourism marketing and infrastructure, according to each locality’s respective legislative agenda, the local delegation to Richmond was split on the sales tax bill.
Del. Brenda Pogge, R-James City County, and Del. Mike Mullin, D-Newport News, both voted against the measure.
Pogge said the tax increase “represents taxation without representation, which is ironic for that to happen in Williamsburg.”
“Instead of tourists paying the tax, the population at large pays the bulk of this tax,” Pogge said. “It’s a $25 million tax coming out of the pockets of my constituents every time they pass a cash register.”
Mullin declined to comment for this story.
For State Sen. Monty Mason, D-Williamsburg, it’s not about taking control away from localities, it’s about the area “taking control of our own destiny.”
Mason voted in favor of the measure.
With the 2019 commemoration of the first Africans in Virginia, Jamestown’s first Thanksgiving, and the 400th anniversary of the founding of the General Assembly, now’s the perfect time to implement a tax increase, according to Mason.
“I don’t ever know if I’ve seen a tax where people do cartwheels and say ‘wow this is great,’” Mason said. “This is revenue for the region, and yes an extra percent will be paid by the people who live here, but it will also be paid for by millions of people that come here.”
Mason said the measure could have a multiplying effect, not only on the area’s tourism economy, but on other businesses as a whole.
“We have the chance to triple the amount of tourism marketing money coming to our area,” Mason said. “That’s attracting people to come to our localities to spend money. This is about driving traffic and generating interest, but maintaining that momentum, again that timing on that front is very good.”
While the bill still needs to be signed off on by Northam, it could bring an additional $15.3 million to local coffers in its first year of implementation, according to the bill’s fiscal impact statement.
By its fifth year of implementation, it could bring an additional $19.8 million to the area, according to the bill’s fiscal impact statement.
Norment said he’s hopeful Gov. Northam will sign the bill when it goes under his hand.
“I am confident that Gov. Northam will sign it, and he will see the value of it to the Historic Triangle,” Norment said before saying he wanted to see the area “[S]top trying to beg or plead for tourism development money, and take an initiative on our own.”
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