Calendar change for city taxes considered

RADFORD – Radford City Council is considering a change to its tax calendar, switching from a calendar year system to a fiscal year.

Monday, council members heard public comment from citizens regarding the proposed change.

Some citizens said they feared the city would see a decrease in revenue from personal property tax (“car tax”) if vehicles are assessed in July, since, they said, Radford University students may not be in the city when the assessment is done. Others questioned whether or not the city could increase the real estate tax rate more than once a year if the switch occurs.

In fact, according to the Code of Virginia section 58.1-3012, localities that use a calendar year system (Jan. – Dec.) can only change their real estate, machinery and tools, and personal property tax rates “prior to the date on which the personal property and land books are delivered to the treasurer.” That restriction does not apply to localities that go by a fiscal year system (July 1- June 30), according to an opinion of the attorney general included in the state code. That opinion reads, “The limitation on the authority of a calendar-year locality to change the real estate property tax rate during a calendar year before the date of delivery of the land books to the local treasurer does snot apply to a fiscal year locality; a fiscal year locality may change its tax rate during a fiscal year without limitation.”

Mayor Thomas Starnes and Council member Laurie Buchwald both said Monday the change in taxing authority “is not the intent” of council’s desire to make the change.

Rather, the change is being sought to give the city additional time to craft a budget without having to do so before the state finishes its budget.

“The sole purpose is to try to give the city more time to prepare a more realistic budget,” Starnes said.

“The problem is there are a lot of variables unknown, mainly with state revenues and the school budget, when we are creating the budget now,” said Radford Finance Director Trish Cox.

If passed, the change from a calendar year system to a fiscal year system will impact the due dates for personal property taxes. Citizens would see the following changes to their personal property tax, according to Public Information Coordinator Becky Hawke:

December 2009: No change – based on a January 2009 assessment, a full year’s payment is due as usual
June 2010: During a transition phase, a half year’s payment is due based on a January 2010 assessment (the bill will be approximately half the amount of a normal bill)
June 2011: Based on a July 2010 assessment, a full year’s payment is due
“Thereafter, all personal property taxes will be assessed annually in July, with payment due the following June,” Hawke wrote.   Due dates for real estate taxes would not be affected by the proposed change.  Payments would still be due semi-annually in June and December.

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