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Waiver of penalties and interest on late real estate and vehicle taxes in works

Jeremy M. Lazarus | 4/23/2020, 6 p.m.
Richmonders are being promised some relief as they face a Friday, June 5, deadline for paying city taxes on real ...
Ms. Reid

Richmonders are being promised some relief as they face a Friday, June 5, deadline for paying city taxes on real estate and vehicles.

Pressed by City Council, Lenora Reid, the city’s chief administrative officer, told City Council on Monday that Mayor Levar M. Stoney’s administration supports amnesty for taxpayers that would allow late payments by Tuesday, June 30, to be made without interest and penalties.

Ms. Reid agreed to City Council’s request to have the administration introduce an ordinance by the next council meeting on Monday, April 27, to authorize a waiver of penalties and interest on property taxes and vehicle taxes so that council can approve it in early May.

The ordinance would expand a waiver of penalties and interest for businesses that are struggling to pay taxes collected on meals, concerts and hotel rooms. That waiver is expected to be approved by council on Monday.

Ms. Reid gave her assent to the waiver after expressing concern about a proposal from Councilwoman Kristen N. Larson, 4th District, to allow payment without penalty or interest until July 31. Ms. Reid said any payments received after June 30, the end of the current 2019-20 fiscal year, could not be included in the fiscal year collections, creating more red ink.

The announcement came as the council continued its review of the mayor’s amended spending plan for the 2020-21 fiscal year budget that goes into effect July 1.

The council, though meeting remotely, plans to accept public comments on the budget plan that calls for rolling back spending by $38.5 million based on projections of reduced revenue.

People will be able to send comments by email or text or call into the remote meeting and speak if they register online by calling the City Clerk’s Office at (804) 649-7955 by 10 a.m. Monday, ahead of the meeting at 6 p.m.

Any waiver of interest and penalties would impact the current budget.

The city projected in the 2019-20 budget collecting at least $16 million in delinquent tax payments with pen- alties and interest. Ms. Reid was not asked by council for an estimate of how much revenue from late payments might be lost.

Councilwoman Kim B. Gray, 2nd District, who is challenging Mayor Stoney in the November mayoral election, expressed concern that the administration has not disclosed the impact of COVID-19 on the current budget and is being “reckless” in not scaling back proposed spending even more.

While the administration has estimated that meals tax collections could drop 10 percent, or about $4.6 million, in the next fiscal year based on restaurant closures and reduced sales due to a virus-caused recession, Ms. Gray suggested that the loss of revenue could be even greater.

She noted that Henrico County is slashing $100 million from its budget and sug- gested that Richmond needs to prepare for revenue losses far deeper than the $38.5 million projected.

In written comments and statements, Ms. Reid and city Budget Director Jay A. Brown indicated that cuts in city services and furloughs and layoffs of city employees may be needed if the city’s revenue falls.

The written comments indicated the city, as a last resort to maintain a balanced budget, could tap into the pool of $125 million in unspent funds that has been saved to deal with emergencies.