It’s possible to reach the right destination on the back of the wrong horse. That’s our takeaway from city council’s decision at Monday night’s work session.
Councilor Willie Bailey’s plan to dedicate an additional $4.75 million per year to affordable housing by adding one cent to the local restaurant tax moves forward as part of the budget. Process did not call for a vote, but a consensus of four members voiced continued support for the plan. So passage of the budget tonight is now a formality.
City restaurateurs, supported by numerous Alexandria small business owners in a display of solidarity, filled council chambers for the work session. Because it was not a public hearing, the gallery couldn’t speak. But their opposition to the tax increase was unmistakable.
There are three intersecting dimensions to this action – affordable housing, the tax and the current budget process – and each bears discussion.
This was foremost a historic, long-overdue day for affordable housing in Alexandria.
For years, the supply of inexpensive dwellings has been dwindling. Low-rent buildings have been bought and either razed or remodeled, resulting in higher-rent replacements. Some planned developer contributions have either fallen through or been reduced. And competing demands in the budget have often squeezed out affordable housing funding.
This is why it was vital for new revenue to be designated to the affordable housing fund. If it had simply gone undesignated into the capital improvement budget, it could be spent on other things. In forming the group of four who supported designating the tax, Bailey, along with Mayor Allison Silberberg and councilors Del Pepper and John Chapman, confronted this reality.
We understand that affordable housing is not the most important item in the budget. Public safety and health, schools and infrastructure must and do take precedence. Reasonable people can even disagree about whether local government should be in the business of trying to boost lower-cost housing.
What’s not acceptable is the stated support, year after year, by every elected official in Alexandria for more affordable housing, but continued, inadequate funding for it in the budget. You don’t get extra points for wringing your hands as you sit on them.
As wonderful as it is to now have more than $7 million set aside annually for affordable housing (the new restaurant tax plus an existing .6-cent real estate tax set-aside in the general budget), it is patently unfair to raise this money primarily on the backs of Alexandria’s restaurant community.
While city staff correctly said the one-penny restaurant tax hike would only add 16 cents to a $16 dollar tab, the average in Alexandria, this increase is on top of the current 10-cent tax, of which four cents are local and six state. That means the tax on an average meal out in Alexandria would now be $1.76.
More important than the particulars is the principle: it’s not fair for one sector to bear the burden for something that is a city-wide priority. Silberberg tried to forge a last-minute compromise with Bailey to defer his proposal and have council set in motion a comparable funding amount in next year’s general budget.
We think Bailey’s decision to stand his ground was the right one, as this can has been kicked down the road for too long. But Silberberg was also right: money for affordable housing should come out of the general fund and not out of the pockets of restaurant owners.
The budget process also needs fixing. It’s laughable that the public hearing on the budget is slated for May 12 – more than a week after the budget is adopted. We agree with Vice Mayor Justin Wilson that the deadline for large additions to the budget needs to be moved up so there’s room for a public hearing in the midst of the add-delete process.
Significant, dedicated revenue for affordable housing is something to celebrate. But restaurants should only have to fund it for one year. Next cycle, council should shift it to the general budget.