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Scottsville to increase cigarette tax; council adopts $1M budget for coming fiscal year
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SCOTTSVILLE

Scottsville to increase cigarette tax; council adopts $1M budget for coming fiscal year

Scottsville Town Council

The Scottsville Town Council met Monday night.

This story has been updated.

The cigarette tax rate in Scottsville will be increasing starting July 1.

At its meeting Monday night, the Scottsville Town Council voted 3-2 to increase the town’s cigarette tax rate from 35 cents per pack to 40 cents per pack, and voted to approve its Fiscal Year 2022 budget.

Councilors Laura Mellusi and Edward Payne voted no, and Dan Gritsko was absent from the meeting. Other tobacco and nicotine products were not included in the resolution.

Town Administrator Matt Lawless said the town wanted to create parity with nearby counties that have expressed interest in enacting a cigarette tax now that they have that option.

In 2020, the Virginia General Assembly passed legislation permitting counties to impose cigarette taxes of up to 40 cents per pack starting July 1, 2021.

“There wasn’t any good reason for Scottsville to be different, and it gives us the opportunity to sync up our rates with what our county neighbors are doing,” he said.

The budget for FY22 is $1,004,858, including $217,339 for capital projects. Nearly $258,000 is included from the federal government as part of the American Rescue Plan.

“Council really takes the Rescue Plan as a big opportunity to improve our services and our infrastructure and really support the local recovery,” Lawless said. “We take that seriously and want to get to work on it.”

The town plans to spend its American Rescue Plan money supporting Scottsville’s economic recovery.

“We have a local economy that relies really heavily on tourism coming out of Charlottesville and coming onto the James River, so improving our downtown to make it more tourist friendly, and improving that tourism infrastructure, that’s really important for sustaining jobs here,” Lawless said.

About $15,000 is earmarked for community partnerships and economic development, and Lawless said it could be utilized to encourage new businesses to open downtown.

“We’ve still got a few storefronts in town that are vacant, and I’ve seen a lot of reporting around folks who are changing careers and using this moment as an opportunity to start a business,” he said. “We’d like them to live in Scottsville.”

Even with the ARP money, the town likely will need to increase taxes in the coming years to help fund aging infrastructure issues and increasing service demands, officials have said. Initially, Lawless had proposed a town real estate tax in a draft of the budget, but the council decided not to advertise it for implementation.

“The town hasn’t had an adopted Capital Improvement Plan in some years, so we’re trying to get back towards that,” Lawless said. “Just making a list of everything we have and what would it cost to replace it quickly gets to a number that we just can’t support … The structural revenues, just relying on meals tax and business licenses, doesn’t cover it.”

At a work session in April, Mayor Ron Smith said the town will need the real estate tax in the future, but not right now.

“We still have people in town that are experiencing difficulties due to pandemic-related challenges and I think, to me, passing the real estate tax right now is somewhat cruel to the general population,” he said.

Owners of property in Scottsville already pay real estate taxes to Albemarle County. A town tax would be on top of that.

Smith said that in his State of Scottsville report in June, he’ll indicate that a real estate tax is on the horizon.

“That will give a whole year for people to get it into their system that we are going to have a real estate tax with next year’s budget, not this one,” he said.

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