Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, March 7, 1992 TAG: 9203070076
SECTION: CURRENT PAGE: NRV-1 EDITION: NEW RIVER VALLEY
SOURCE: M.J. DOUGHERTY CORRESPONDENT
DATELINE: BLACKSBURG LENGTH: Long
Since school began, the choice of places to eat on campus has grown.
In August, the Hokie Grill began serving short-order hamburgers and french fries, fried chicken and salads from Owens Hall in the middle of the Tech campus.
In November, the Owens Food Court opened, taking up half of the old dining hall with fast-food shops dishing out pretty much everything from pizza to egg rolls, burritos to subs.
This new competition has left many downtown restaurant owners worried about how to compete against the state.
Chris Kappas, owner of Souvlaki on College Avenue, said business is down, although he doesn't know how much, since the food court opened.
"Let's just say it's not what it used to be," he said of traffic in his small shop within a block of campus.
Restaurant owners' worries about surviving escalated this year when Blacksburg proposed raising its meals tax from 3 percent to 4 percent.
The opening of the food court, which does not have to charge the meals tax, "means that one restaurant is also not competing on an equal basis," Bill Ellenbogen, owner of Bogen's restaurant, told Blacksburg Town Council in January.
"And from the town's viewpoint, that means one restaurant's customers are not carrying their fair share of the tax burden."
The outspoken concern of the restaurant owners is the latest round in the squabble between town businesses and the university over what activities are appropriate for Virginia Tech. Both the university and businesses in town serve food, sell books and clothes, rent videos and offer copying services.
The solution seems obvious to some: Have Virginia Tech charge the local meals tax to non-students.
Ellenbogen thinks the town and the university can reach an agreement on how best to charge the tax.
The only thing preventing it is the speed of bureaucracy.
"With an institution like Tech, there is a lot of inertia," he said a few days after his council speech. "It takes time to make changes and time to straighten them out."
But there is something else stopping Virginia Tech - state law.
Nine years ago, Blacksburg and Virginia Tech went down this very road. Blacksburg wanted Tech to impose the local meals tax on meals sold in the dining hall.
William Lavery, then university president, asked the attorney general for an opinion.
That opinion stated: "Generally, the state and its agencies are not bound by any statute, unless the statute in express terms is made to extend to the state."
In other words, a state agency cannot charge a local meals tax.
State sales taxes are another matter. They must be paid on those meals that are not part of the university's meal plan for its students. "We can collect state taxes, and we do," said Ed Spencer, director of residence and dining programs at Virginia Tech.
Private businesses that operate on state property must charge both.
A block away from the Owens Hall food shops are more fast-food stops - a Hardee's and a Mama Jean's pizza restaurant in the newly reopened Squires Student Center.
But these restaurants, and a Burger King on campus, collect both the sales tax and the local meals tax becaise they are privately owned.
"I find it a bit interesting that the businesses most in competition with campus food services - Hardee's, Burger King - don't complain about it [the meals tax]," said Ray Smoot, Virginia Tech's treasurer and vice president of business affairs.
Some merchants think the matter will have to be decided by the General Assembly.
"After we've dealt with Virginia Tech, then we plan on surveying businesses in other localities - Charlottesville, Harrisonburg, Richmond - to see if it [university business] is a problem," said Jim Couch, owner of the Hobby Shop and vice president of the Downtown Merchants Association. "If it is, it may require a state remedy."
There are other possible solutions, too.
Tech has explored converting its meal cards to debit cards that students could use to buy goods and services on and possibly off campus.
Also, downtown business owners have suggested the university might increase its meal prices to reflect the town tax, even if it cannot charge it.
"Discussions are already taking place," said Town Manager Ron Secrist. "I've found Virginia Tech very willing to discuss specific issues, especially in areas of concern such as food service."
Dwayne Kittle, who heads a Chamber of Commerce task force on the issue, said he has been trying to schedule a meeting for several weeks.
Tech was not trying to cause problems when it opened the food court, university officials say. It was trying to better serve its student population.
Following a recommendation from a student advisory committee, it converted four cafeteria dining rooms in the former dining hall into the Owens Food Center with the food court operating weekdays, the Hokie Grill open daily and the Owens Banquet Hall for catered events.
Suddenly there were more choices for the food dollar. And that is what has created the stir.
"We're not just a cafeteria anymore," said John Engstrom, director of culinary services. "We are specialty shops. We're breaking up the the old image, the institutional image."
The changes continue. Plans call for converting Shultz Hall near Main Street, the campus's oldest dining hall, into fine dining - a restaurant with table service and elegant entrees. An old-style coffeehouse is to be created in Dietrick Hall on the south end of campus.
by CNB