Schools, Floods, Roads, Monuments, Gambling, Oh My!

by Dick Hall-Sizemore

Local referenda, while important locally, are often overlooked in the media coverage of elections. However, the results of those elections may provide some insight into the mood of the electorate, at least in some areas of the state. Following is a summary of the results of the local referenda on the ballot last Tuesday.

Localities cannot hold a referendum unless authorized or required by state law. The most common referendum question has to do with the issuance of general obligation bonds. The state constitution governs when a referendum is required. Generally speaking, a county cannot issue general obligation bonds unless approved by the voters in a referendum. In contrast, cities and towns are not required to have a referendum. However, some cities have charter provisions restricting how much general obligation debt they can issue. Virginia Beach and Danville, the two cities that held bond referenda this year, fall into this category.

In addition, referenda are allowed or required on a variety of policy questions.  This year there were referenda on the levying of additional sales tax, establishment of gambling enterprises, and replacement or relocation of monuments.

Bonds. Voters in eight jurisdictions authorized the issuance of almost $1.8 billion in general obligation debt. Arlington and Spotsylvania counties had the most bond questions on their ballots, four each. In fact, in a sign of Spotsylvania’s continuing transition from a rural county to a suburban, bedroom community, the county’s voters were asked to approve the highest total amount of bonds of any locality, outside of Virginia Beach, this year. The total amount of the bonds on the ballot was $398.7 million (the voters approved $340.7 million).

Virginia Beach had the largest single bond referenda question. In a historic move, the city asked its voters to approve borrowing up to $567.5 million for flood protection and mitigation measures. This issuance was the second largest bond issuance in the country in recent years related to flood protection, second only to the $2.5 billion issued by the city of Houston in the wake of Hurricane Harvey. As pointed out by Virginia Business, “The sea level at Virginia Beach has risen nearly a foot since 1970, and it is expected to rise 3 feet by 2075.” This rise was ascribed to a combination of subsidence and a rise in sea level generally.  The result has been recurrent flooding not related to a major incident such as a hurricane.

The city went to great lengths in explaining the proposal to its residents. There was a series of public meetings and details of the proposal on its website. In its explanatory material and announcements leading up to the vote, the city was transparent with voters, explaining that authorizing the issuance would result in a tax increase of 4.3 to 6.4 cents per $100 of assessed value in order to raise the revenue needed for the debt service. The referendum was overwhelmingly approved with 73% voting in favor.

Most of the other bond referenda were related to school funding. The only bond issue that lost was in Spotsylvania. It was for parks and recreation projects, with the centerpiece being an Olympic-sized competitive swimming pool. Almost 63% of the voters turned this one down.

Below is a table listing the bond referenda and results:

Policy issues. Sales tax increasesState law authorizes a locality to increase its sales tax by 1 cent, if the additional funds are used for school construction or renovation and if the increase is approved by the voters in a referendum. This question was put to voters in two localities this year.  In Danville, 60% of the voters approved. However, in Pittsylvania County, surrounding Danville, the measure narrowly lost by 44 votes out of more than 25,000 cast.

Monuments—Under state law, a locality may petition the circuit court to order an advisory referendum on the removal, relocation, contextualizing, or covering any publicly owned war monument or memorial. There were three such referenda this year:  Middlesex, Mathews, and Nottoway counties. By a majority ranging from 68% to 8o%, the voters in all three localities opposed  any removal or relocation of the respective monuments.

Gambling facilities—Before the Virginia Racing Commission may grant a license for a pari-mutuel satellite facility, there must be a referendum in the locality in which it is proposed to be located. In Amherst County, 54% of the voters disapproved of licensing a facility in the county. On the other hand, the voters in Emporia welcomed a satellite facility, with 66% voting “yes”.

In a surprise, in the required referendum, the voters of Richmond narrowly (51.2%) defeated the proposal to locate a casino in the city. Earlier in the year, the city had received three proposals for casinos — two in white areas and one in a Black area in South Richmond along the Rt. 1 corridor. After getting considerable backlash over the ones proposed for white areas, the city settled on the one in South Richmond. The project was billed as the nation’s first Black-owned casino and the developers projected 1,500 new jobs and $50 million in annual tax revenue for the city. Proponents of the project reportedly spent $2 million in promoting its approval in the referendum.

In a sort of reverse-NIMBY vote, voters  in the majority white areas of the city killed the proposal, voting 2-1 against it, while Black voters in the area in which the facility would have been located strongly supported it. (See Richmond Times-Dispatch report of outcome here.)


Share this article



ADVERTISEMENT

(comments below)



ADVERTISEMENT

(comments below)


Comments

17 responses to “Schools, Floods, Roads, Monuments, Gambling, Oh My!”

  1. LarrytheG Avatar

    In Spotsy , the voters turned down GO bonds for a swimming pool which was a little fuzzy in concept since we have community pools and YMCA pools.

    https://fredericksburg.com/news/local/spotsylvania-bond-referendum-could-help-fund-joint-aquatics-center/article_28e749e9-4f9b-5fe4-8733-c2d6e59d965f.html

    Not sure if Dick covered this but rejection of a project for GO bonds does not mean rejection of the projects. The elected board can still vote for the project and find other methods of paying for it – other bonds or higher taxes or both.

    AND ‘approval’ of the projects specified in the referendum does NOT guarantee they will actually be built – and in either case – approval of a project – may well result in tax increases to pay for it. It’s not necessarily
    saying the project will be built with no tax increases.

    OTOH, with other issues like monuments and gambling casinos, I’m not sure if these votes are more ‘advisory” like the GO bonds are.

    If voters say yes or no to the monuments or casinos, can the elected boards vote the other way anyhow?

    1. Dick Hall-Sizemore Avatar
      Dick Hall-Sizemore

      You are correct that, if a bond referendum fails, a board of supervisors could go ahead with the project, paying for it with operating funds, possibly with a tax increase. But, it would be really risky, politically, to go ahead with a project which the voters had turned down. I can’t say that it has not been done, but it would be highly unusual. By the way, there are no “other bonds”. The board could schedule another referendum and try to do a better job of educating the voters.

      And, yes, voter approval of the issuance of bonds does not guarantee that the the bonds will be issued and the project built. However, boards do not vote to issue bonds and schedule referenda lightly. They have gone on record as saying that the proposed project is needed and is important enough to borrow money to pay for it. They have spent some time and political capital in urging voters to approve it. The citizens who voted to approve the bond issuance, a majority of the voters, have every expectation that what they were led to believe was going to be be built will indeed be built. A board would look awfully foolish if they neglected to follow through.

      No one ever said that future tax increases may be necessary in the future.

      As for the monuments, state law specifies that the referenda will be advisory. However, the board probably asked for the court to schedule a referendum to give it cover on a controversial issue. Therefore, it would be highly unlikely that the board would not act in accordance with the results of the referendum.

      Finally, regarding the gambling enterprises. Yes, a positive referendum vote does not guarantee the facility will be established. After all, these are private enterprises, not public ones. But it would be highly unusual for a business to spend the time and money needed to get to the referendum phase and then back away. If the vote is ‘no”, as it was in Richmond, the Virginia Lottery Board or the Virginia Racing Commssion, the regulatory authorities, are prohibited from issuing a license. The city council or county board has no role. Therefore, it is not an “advisory” referendum.

      1. LarrytheG Avatar

        Thanks for clarifying. Below is an extract from the Spotsy FAQ on their referendum and where I got the idea that other financing/bonds were possible:

        https://uploads.disquscdn.com/images/7eeba5a9a19c0fc39ed0ff00cc880b3725f7d8d6f25bff82b53a4dd96bcb1a16.jpg

        Also, thought I read somewhere that some cities in Va do not need to hold a referendum to float GO bonds…

        https://law.lis.virginia.gov/vacodefull/title15.2/chapter26/article4/

        1. Dick Hall-Sizemore Avatar
          Dick Hall-Sizemore

          As I pointed out in my post, the state constitution does not require cities, as a general rule, to have a referendum in order to issue general obligation (GO) bonds. However, some city charters place limits on the amount of GO debt a city may accrue on its own; after that limit is reached, a referendum would be required for any additional GO debt. The charters for Virginia Beach and Danville have such provisions.

          Counties may issue revenue bonds without having a referendum. A revenue bond is one that has a specified stream of revenue that can be used for debt service. An example of a revenue bond is one for water and sewers. The revenue generated from connection and service fees serves as the source for debt service. Schools or non-toll roads do not generate revenue and, therefore, must be financed with general tax revenues, which is not considered a specified source of revenue.

          Another difference between GO debt and revenue bond debt is the guarantee. A GO bond is backed by the “full faith and credit” of the county. That is the highest level of guarantee. That means the county is saying that debt service will be the first thing we pay, no mater what. Unless the county declares bankruptcy, the debt service will be paid. Those bonds get the highest rating and pay the lowest interest rate. On the other hand, a revenue bond is backed only by the revenue of the project being financed. If that revenue is insufficient to pay debt service, the bond holders do not get their money. An example of this latter occurrence was the Chesapeake Bay Bridge Tunnel. In its early early years, it did not generate enough money to pay debt service and the bond holders went some years without collecting their monthly payments.

  2. James Wyatt Whitehead Avatar
    James Wyatt Whitehead

    Loudoun is projected to spend 1.4 billion on school construction over the next decade. Gearing up for the anticipated expansion around the end of the Metro line. https://uploads.disquscdn.com/images/0c5331e5bfddcd1d863e7f11a313c370ee63dd4cb7dc4d74f23c8d9e51625a37.jpg

  3. Stephen Haner Avatar
    Stephen Haner

    Good summary. These are always some of the most illuminating results. At my Henrico precinct many voters were upset they couldn’t vote on the Richmond casino question, having seen all the ads and coverage.

  4. how_it_works Avatar
    how_it_works

    Who needs flood mitigation? So much cheaper to plop one of these signs in the ground:

    https://uploads.disquscdn.com/images/aa8cf0aeaed901666c007552cee63f0060e42375f48dcb839c8d35a749ac5a3a.png

    1. LarrytheG Avatar

      perhaps that sign will keep idiots from trying to drive through flooded roads?

      But perhaps more to the point – roads can often fundamentally exist to access property and if the road is underwater then properties likely are also and a big difference with rising oceans and such is that king tides and related that happened rarely or infrequently may occur much more often and for longer durations – and even if the road is ‘raised’ – the properties themselves and the houses that are on them may not and become uninhabitable. That is what happened to parts of NJ from hurricane Sandy. FEMA would not provide continuing insurance unless the houses were raised/elevated, the costs of which can exceed the value of the house rendering it uninsureable for the
      next flood.

      So one might wonder just how effective such spent tax money might be for things like water/sewer which will also be ‘under water”. Roads in areas that flood more frequently may become more like causeways – surrounded by standing water.

      1. how_it_works Avatar
        how_it_works

        FWIW, I have only ever seen those signs in Virginia. I’m not sure if that says something about Virginia roads or Virginia drivers or both.

        1. LarrytheG Avatar

          I’ve seen them in other states…especially on low-water bridges and arroyos.

          Plenty of drivers in other states drive their cars into flood waters… not just a Va thing.

          1. how_it_works Avatar
            how_it_works

            Here in Virginia, it’s common to see them on roads that carry a lot of traffic.

            Up until about 15-20 years ago there was one on Lomond South Drive in Manassas. And I think there’s one on Dale Blvd in Dale City.

            You might think that someone would look at that and say, “Aww shucks, maybe we shouldn’t have roads that carry a lot of traffic get flooded so often we need signs that like that on them” and fix the problem.

            Clearly, they ARE capable of it, they fixed the one on Lomond South Drive.

          2. LarrytheG Avatar

            you’re quite a critic of Va and VDOT, eh? 😉 I’ve driven in every state but Hawaii and Alaska and Va roads just aren’t that bad even though VDOT has the 3rd or 4th most miles of roads to maintain.

            And part of our problem until very recently is that our gas tax was among the lowest in the country – now it’s equivalent to most other states…

          3. how_it_works Avatar
            how_it_works

            As a matter of fact, I believe that Prince WIlliam County funded the improvements to Lomond South Drive to fix the flooding, since VDOT was off somewhere drinking a 6-pack for lunch.

  5. Steve Gillispie Avatar
    Steve Gillispie

    Excellent summary and good citizen education. I learned a lot from this one.
    Thank you.

  6. Of all the referenda, to my mind the Richmond casino vote was the most interesting. As you noted, Casino One was billed as the first black-owned casino. A published list of investors was a Who’s Who of Richmond’s Black bourgeoisie. A big selling point, as Dick points out, was the jobs created and taxes generated. But the foes were concerned about the social implications for the surrounding population — skimming wealth from the poorest sector of the population. It’s not as if a Richmond casino would become a tourist destination and draw people from far outside the region. Affluent Richmonders who want to gamble can afford to fly to Las Vegas or go on cruise ships. The concern was that most patrons would be local — poor locals, particularly poor Blacks.

    Apparently, such concerns did nothing to halt the casino projects in Portsmouth, Danville or Richmond.

    1. Dick Hall-Sizemore Avatar
      Dick Hall-Sizemore

      It is true that one organization opposing the casino made the argument that a casino would be exploitative. However, considering that almost all, if not all, the Black organizations in the city supported the casino project, that argument sounds somewhat patronizing, sort of along the lines of “we white folks got to protect black folks from themselves.”

      That argument may have made the difference in the election. However, a larger factor could have been the larger than expected turnout of Republicans. One lobbyist who worked for the casino developers told me that their internal polls showed support for the casino slipping just as support for Youngkin was increasing. “Older white folks were against it and younger black ones were in favor.”

      (Disclosure: I would have voted against it if I had lived in the city. There is just something about a government getting a chunk of its revenue from gambling that does not sit well with me.)

  7. Goochland passed two bond referendums. The one for schools which you noted and a second one for bonds up to $36 million for courts, law enforcement and public safety projects

Leave a Reply