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Putting your money where your mouth is
If supervisor Stuart Hall is to be believed, Bath County is enjoying a huge boom in dining out.
In the course of debating the merits of a new "meals tax" to generate additional revenue, Hall said the county could realize something close to $2 million a year from a 4 percent tax added to meals served in local restaurants. No wonder the long-time leader with a consistent penchant for resisting taxes supports this idea.
If it's true (Hall declined to reveal his source for his estimate), visitors and residents are spending $50 million a year eating out in Bath. That's a lot of bologna.
Retail food-related sales in Bath and Highland counties combined were less than $9 million annually, according to recent figures from the Central Shenandoah Planning District Commission. In fact, in 2006, Bath's total taxable sales were $67 million — that includes everything from oil paintings to chewing gum.
Bath supervisors are nevertheless going to let voters decide whether a meals tax should be part of increasing county revenue; the board agreed last week to pursue adding the question to ballots Nov. 4.
While diversifying the tax base is good for any locality, a tax on meals should be carefully weighed by the voting public. If the extra 80 cents on your $20 meal could really help contribute up to $2 million, the decision would be a nobrainer. But, if it adds only $200,000, which may be a closer estimate, voters should seriously consider whether it's worth the potentially negative impact to dining establishments everywhere from the Country Café to The Homestead.
If residents are to support such a tax, supervisors should tag the money for a specific use citizens can get behind — emergency services, for example.
Ironically, supervisors are considering taking increased revenue from a proposed lodging tax boost for that purpose, but they have muddied the issue.
There's a big difference between a meals tax and the lodging tax.
For one thing, a meals tax would affect far more county residents, those who tend to do the bulk of the eating out in Bath.
The lodging tax affects far fewer citizens here, unless they choose to spend the night in a bed and breakfast instead of their own homes.
Lodging tax is also clearly defined by state law: The first 2 percent tax goes directly to the county's general fund. That amounted to some $440,000 last year. Anything above 2 percent must go, by law, to promoting tourism, which would include local groups that do so. As far as we can tell, the Bath County Chamber of Commerce is not only the most logical place to get this revenue, but also the only one that qualifies as a group promoting tourism.
Hall said, "Nothing in the code says we have to give the chamber anything."
That, of course, is a real stretch.
Now, the board has decided to see if the General Assembly will make an exception just for us, and allow Bath to use the extra percentage revenue for something other than tourism, like emergency services. Supervisor Richard Byrd even proposed seeing if Bath can raise the tax to 5 percent, and spend half on tourism and half on safety providers.
This is a huge waste of time. First of all, state lawmakers are highly unlikely to make such an exception. They loathe bending their rules when doing so opens the doors for a flood of similar requests. Bath County is in no position to argue it deserves its own loophole.
Secondly, the chamber's position is simple: Raise the tax by only 1 percent, and give the $220,000 to that group. Tourists and visitors take a softer tax hit, and the chamber has plenty of money to attract more of them.
Given what the chamber has been able to accomplish with its measly $40,000 contributed from the county, a $220,000 windfall, properly managed, can mean a world of differences to all the "second tier" tourism-based businesses from motels to retail stores.
The chamber, which consists almost entirely of representatives from successful businesses who already know how to stretch a dollar, could promote Bath as a destination far more heavily, create more and better brochures and distribute them more widely, upgrade its offices and staff, renovate the welcoming gazebo in Warm Springs, and other similar projects that would really put Bath County on the map.
The recent hope that supervisors and the chamber were closer to forging a solid, mutually beneficial relationship seemed too good to be true at the time, and Hall's statements only drive a needless wedge in negotiations for a memorandum of understanding.
Whatever Hall's position, the other four supervisors have an opportunity to get this train back on the tracks. They've expressed general support for tourism promotion before, and we expect they will take a hard look at real numbers, and think clearly about the next steps.
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