Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: TUESDAY, March 23, 1993 TAG: 9303230291
SECTION: VIRGINIA PAGE: C-1 EDITION: METRO
SOURCE: JOEL TURNER STAFF WRITER
DATELINE: LENGTH: Medium
DRIVERS, SMOKERS TO FUND JAIL
Smokers and car owners in Roanoke will pay for the expansion of the city jail and juvenile detention home to relieve severe overcrowding.Despite opposition Monday, City Council voted to increase the city's cigarette tax from 14 cents to 17 cents a pack and the automobile license decal from $15 to $20 a year.
The tax increases will produce $630,000 a year that will be used to repay $6.3 million in bonds needed to finance the jail and juvenile detention home projects.
The cigarette tax increase will happen July 1, but the higher decal fee won't take effect until April 15, 1994. It is too late to make it effective this year, city officials said.
In addition to the bonds for the jail and detention home, council voted Monday to issue $13.8 million in bonds without a referendum to pay for the conference center that will be part of the Hotel Roanoke project.
The conference center bonds will be repaid with higher tax receipts generated by the hotel project.
City Manager Bob Herbert said that the renovated hotel would produce an increase in lodging, meals, utility, personal property and real estate taxes that will be sufficient to repay the bonds.
Mayor David Bowers said 35 people called the city clerk and his office before the meeting to oppose the increase in the cigarette tax and automobile decal.
Only one person, Melvin Echols, spoke at the hearing on the bonds and taxes.
Echols said that a higher cigarette tax would cause more city residents to travel to nearby localities - those with no cigarette tax or a smaller tax - to buy their cigarettes.
While these residents are shopping for cigarettes, he said, they will probably buy groceries or other merchandise. This will cause the city to lose sales taxes, he said.
"It doesn't make sense to drive business out of the city," Echols said.
Echols said the city's taxes keeping going up while services go down. He cited the elimination of backyard garbage collection and a reduction in the frequency in street sweeping as examples of cuts in services.
Echols said real estate taxes keep increasing because of higher assessments.
Councilman James Harvey said Echols has a point on rising real estate taxes. "I'm going to have more to say about that during budget study," Harvey said.
Herbert recommended that council issue the bonds without a referendum because the city is under pressure from the judges to ease overcrowding in the jail and juvenile detention home. The judges have hinted they would order council to ease the jail overcrowding if the city kept delaying the project.
Herbert said he tried to soften the impact for taxpayers.
The decal fee increase is a relatively small amount per citizen and the cigarette tax is a user fee that would only impact those who buy cigarettes, he said.
\ BOND ISSUE\ Hotel Roanoke Conference Center $13.8 million\ Jail annex $4.8 million\ Juvenile Detention Home expansion $1.5 million\ Total $20.1 million\ \ REVENUE TO REPAY BOBND\ Increase in cigarette tax from 14 cents to 17 cents a pack $305,000 per year\ Increase in motor vehicle license fee from $15 to $20 $325,000 per year.