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The Devil's In the Decals
More than 360,000 city decals will be issued this year for vehicles registered in Virginia Beach, generating an estimated $7.8 million dollars in city revenue.
City officials don't want to lose that money - it helps pay for road maintenance and construction. They do, however, want to see if the decades-old process for collecting that money can be improved - both for citizens and municipal workers. How to do that has sparked a debate between the city treasurer and commissioner of revenue.
City Finance Director Patti Phillips presented a policy report on several options to the City Council on March 19, and since then the city has held several focus groups and conducted a phone survey of residents.
The results of those opinion-gathering exercises are expected to be shared within the next few weeks. They will then direct city staff on preferred options and a timetable for making any changes, which could take effect as early as July 2003.
Under the current system, city decals are sold over the counter year-round through the city treasurer's office. A current decal must be displayed by Feb. 15 of each year. Decals are not issued for vehicles on which prior years' personal property taxes are unpaid. That has led to long lines outside the treasurer's offices each February as citizens attempt to pay their delinquent taxes and receive the decal by this deadline. Motorists caught by police driving a vehicle without a valid city decal are subject to a fine.
Until a few years ago, Virginia Beach Commissioner of the Revenue Philip J. Kellam used city decal records to identify personal property owned in the city and assess a tax that is paid annually in June.
That is the same tax that former Gov. Jim Gilmore set out to eliminate, beginning in 1998. Due to state budget constraints, however, the property tax will not be phased out in the five years as originally proposed.
Kellam now relies on the Virginia Department of Motor Vehicles database for identifying vehicles that should pay that tax and for assessing the amount. Therefore, he contends, the decal is no longer necessary and should be eliminated. So that the city doesn't lose the decal revenue, Kellam proposes that the fee ($25 on most automobiles) be added to the annual registration fees charged by DMV.
City Treasurer John T. Atkinson argues that until personal property tax is eliminated, he wants to keep the city sticker as a means of forcing delinquent taxpayers into compliance. He said the sticker is more effective than other tools such as mailed notices and tax liens.
Atkinson favors combining the city decal fee with the personal property tax bill due in June. Both would be due at the same time, eliminating the Feb. 15 deadline.
The City Council has the final say on what, if any, changes should be made to the city vehicle registration process. The Beacon invited Kellam and Atkinson to explain why each thinks his plan is the best alternative.
John T. Atkinson's Alternative
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