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Interview: Mayor Levar Stoney Addresses Concerns Over Meals Tax Proposal



If you haven’t noticed, the debate over the mayor’s proposed meals tax increase has been heating up, especially online.

Recently, Style ran an opinion piece written by Paul Goldman, chief architect of the schools modernization referendum now in the General Assembly, that was critical of the 1.5 percentage-point tax increase, or 25 percent hike. He claims that there is more money to be found in the city budget, which should be reined in before levying any tax.

Since there still appears to be confusion in the public, as well as increasing divisiveness, we thought we’d give Mayor Levar Stoney space to address some of the concerns that we've heard voiced in the community.

Style: Right now, I think our readers are chiefly concerned with the process. One of your campaign issues was transparency. Do you feel that the Feb. 12 vote deadline is enough time for council members to go back and meet with their districts to debate this?

Mayor Stoney: I think this has been debated for a very long time. The issue of the need for school facilities has been at the top of the list for many of these councilmen for many years. This is a debate that has been going for at least 30 years.

When we ran for office in 2016, every single person who now holds elected office has talked about the needs for new school facilities. … This is what we got elected on. To me, that was referendum enough on what we need to do right away. When people talk about the time for more meetings, that to me is another delay tactic. This is not the time to delay, this is the time to act. … Henry Marsh attended George Mason back in the 1940s: He told me it was a pitiful facility then. The longer we wait, the longer another child attends George Mason and has to deal with those conditions. To me, that’s unacceptable.

Your group describes this tax as discretionary and progressive – critics say it's regressive, will cost $90 million over a decade and hurt those who can least afford it. You speak of One Richmond, why not propose taxes more evenly distributed among personal property, real estate or the business, professional and occupational license tax rather than singling out an industry that has already been hit by an increase?

Well first, this does not single out an industry. This is a tax on restaurant goers, those who choose to dine, not a tax on restaurants themselves. We chose the meals tax because it's reliable, sustainable and progressive. I grew up in a fixed income household, going out to eat was a luxury, McDonalds or fast food [too]. What I know is the top 20 percent of our community dine out five times more than the bottom 20 percent. You can find those stats from the Bureau of Labor Statistics.

Laura Lafayette wrote a passionate opinion piece in the Times-Dispatch urging us not to squabble over pennies – are you currently discussing a tax abatement program with her group, the Richmond Realtors Association?

No … no tax abatement is being spoken of. Once again, these are the sort of smoke screens people throw up to actually not talk about the discussion at hand: building school facilities now, not waiting until the 2020s to do it.

The School Board passed a facilities plan with an $800 million price tag – what’s your dollar-figure goal to have funding in place before you leave office?

At my state of the city address, I spoke about wanting to tackle emergency needs right away. This is what the $150 million dollars is all about, raise the meals tax so we can borrow to tackle those needs right away. The city’s debt capacity opens up in 2023, we’ll have $300 million available to us. We have to plan now for the future. Not wait. What I said, not only should we be building schools, but communities of opportunity. That’s what we’re going to focus on over my time as mayor. And we’re going to be fiscally prudent in our approach.

Why is the AAA bond rating so important to you?

It’s important because it allows us to go to Wall Street and find bonds that, I guess you would say, are cheaper, or to borrow cheaper on those bonds. That’s just the bottom line.

Let's remember, Richmond 10 years ago was borrowing dollars to pay its payroll. Ten years later under my administration we’re not in that situation anymore. The rest of the city should be proud that we turned in our financial report on time and just last week … [Auditor of Public Accounts report] said we are not in fiscal distress.

In 10 years, $558 million would be the debt amount allowed by your CAP strategy. Many people remember the CenterStage meals tax hike that was supposed to be temporary: what’s the main way you can reassure people the money will be used for schools and not re-purposed?

I've spoken about transparency and I'm committed to that. I spoke of a special reserve fund to actually commit to being transparent -- with the city coming on a quarterly basis to talk about where those dollars are going.

Unlike the 1 percent [hike] earlier, there was commingling of those dollars. ... This guarantees 100 percent for school construction. There’s no getting around that …. [From later in conversation when CenterStage was broached again]: I understand where they’re coming from. I’m not going to follow the fiscally imprudent actions of prior administrations. We took out a 1 percent increase back in 2003 and currently we still owe debt on the buildings we built with that 1 percent. Three times more than what that 1 percent was providing us at that time!

As far as the argument has played out online, is it fair that those who don’t support the meals tax increase are being labeled anti-schools with an undercurrent of racism in some discussions?

You know, that is not fair. I spoke about this on Facebook late last week. I know emotions are getting high on all sides. This is an emotional debate. No one should be labeled anything. I talk about One Richmond for a reason: Children here, anyone here, should have opportunity to rise. Right now I think education is the social justice issue of our time. I talk about it every day. The question we have to answer: Is it OK for our children to walk into decrepit facilities on a daily basis? The answer is no.

Seems like most people are in agreement on that. But to follow up, Times-Dispatch columnist Michael Paul Williams mentioned the optics of your news conference this week, which featured mostly black-owned restaurants that are pro-tax. Does that feed into the divisiveness at all?

Those restaurant owners support me because they support us investing in public education. There are number of white owners who believe the same thing … This is about those who support what we’re trying to do. I’ve explored every option for the funding of Richmond Public Schools. The best, most reliable, is the meals tax. Here’s the thing: This is not either or, this is a both and. We can have strong, thriving restaurants and strong, thriving schools too.

We did opinion research late last year, 69 percent of residents said they would be more likely to support our restaurants if a portion of their meals tax went to education.

Also you're trying to reform the Local Composite Index funding formula, and get additional funding for at-risk add on program – how are your lobbying efforts going this General Assembly?

You know, I'm optimistic about what we can get done. I don’t have that much faith in Republican majorities, but at the end of the day, I'm optimistic. The Commonwealth of Virginia has long neglected the capital city. We have a number of buildings downtown that they don’t pay any property taxes on. That’s why we’re put in these binds on a yearly basis. I've sat down with a number of members of leadership, Republican and Democrat, they know where we stand, and I'm going to continue to push this through.

How do you answer critics like Paul Goldman that you’ve done everything you could to find existing money in the budget before levying a tax?

When I ran for mayor I called for performance review on every single department in City Hall. What that review highlighted was we do need to make more investment to bring more efficiency into city government. We've got to work on doing that.

[But] That’s also why we were able to fill 25,000 potholes this year, compared to 18,000 year before, we got to 1,600 alleys as well. We’re reforming the permitting department. We’re doing the right things with the city’s money and we’re doing more with less. That’s the key. Streamlining city government will take further investment and time as well. But I have to point out, we can’t borrow $150 million on streamlining inefficiency. You need revenue for that, additional revenue.

I know you clearly distanced yourself from the boycott email drama last week and said you had nothing to do with it. The only question I had involving that story from last week – Cindy mentions the signs and stickers made – is your political action committee funding these?

I have not seen any signs or stickers. The only ones I’ve seen have said no to the meals tax. I don’t even know what these signs look like.

Considering the majority support for the referendum, some have wondered why not a fully funded plan as the referendum calls for – at least spelling out what is needed for a full system-wide fix?

My $150 million dollar plan is the first step. Our schools are in a state of emergency. When I hear that question, I think it’s like someone saying "I don’t want to start solving the world’s problems until I have a plan to solve all of them." To me, that’s unacceptable.

Our kids can’t wait another year. We need to act now. We should not wait on what the General Assembly has to do with the referendum either. We’ve known these problems for decades and continually the leadership has kicked the can down the road. It’s time for all of us to find the courage to do the right thing. To insure these kids can walk through the doors of these new facilities in fall of 2020.

The other thing that seems like a big priority is public housing, which I think houses about 20 percent of public school students. Considering the recent mess with the Richmond Redevelopment and Housing Authority -- how do you plan to address this problem immediately?

We’ve normally looked at all our problems through silos. Whether public safety, public education, housing or poverty negation – four silos at all times. What I proposed in my speech was one Richmond, one plan. That’s what we need. We can’t build schools and think that will change everything for a child. We've got to build communities that will allow them to be healthy and allow them access to opportunities. We need to think about fiscal dollars the city will have, we have to be strategic about how we use every single dollar moving forward to attack all these issues under one plan.

As a former reporter pointed out in a thread I saw today, wouldn’t this schools problem be much easier to tackle if there was a serious effort to create a regional authority board for public schools with the power to levy taxes on the entire regional tax base instead of just 250,000 people in Richmond?

I mean, that sounds like a General Assembly issue to me – but also it sounds to me like another delay tactic. We already know what we need to do for Richmond Public Schools. All I hear are more delay tactics. The real threat to our city and thriving restaurant industry is our failing schools. If they continue to fail you’re going to see more young people who live in the city now move to the counties and take their tax dollars, real estate and dining. We can’t afford that.

Well, thank you Mr. Mayor for your time and your passion on the schools issue. From what I've heard, I think most people are with you on fixing schools. But there are those who have a longer institutional memory who are wary of rushing things, wary of corporate handouts. They just want accountability and transparency, not to delay help to schools. ... Also I heard Parker Agelasto was introducing a cigarette tax – why wasn’t that a serious option?

Because it's an unreliable revenue stream, it's declining. You can't borrow $150 million on that, It would be fiscally imprudent. Are all options on the table to meet the needs of the city in general, and could a cigarette tax do that? Yes, it could be added to the general fund budget. But right now we need a dedicated revenue stream to borrow $150 million for our kids. And that stream is adding 1.5 percent to the meals tax today.

I know you already had your own state of the city address, but is there anything else you feel the media is missing or people are misunderstanding that you want to get out there? Here’s a chance.

I just want to stress this is not restaurants versus schools. This is about acting now. No longer waiting. I think everyone can agree we’ve waited way too long and neglected our schools for too long.

We’re talking about one and a half pennies here.

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