Alexandria, VA

Alright, which of you went to a movie in April?

At the height of the pandemic, when nearly everything in the city was shut down, the city’s latest revenue report shows that the city still collected $2 in admissions tax. The city’s finance officials ran the numbers and said that meant that four people bought tickets at movie theaters in Alexandria while nearly everything in the city was shut down.

“I don’t have their names, but that is how little revenue we collected in admissions tax,” said Kendel Taylor, the Director of Finance. “There were four people who contributed to that.”

It was one of the few moments of levity in what was otherwise a particularly dour financial report at yesterday’s City Council meeting that showed millions lost in meals tax revenue and transient tax revenue. Sales tax remained high, but only because the figures were from March, before the shutdown started. The lack of tax revenue has led to a gutting of the city budget with projects like the redevelopment for T.C. Williams High School pushed back.

While Taylor said she was grateful that the city went into the pandemic with a strong economy, she was less optimistic about the rate the city will be able to recover. Taylor said there’s no guidebook or methodology for figuring out what happens next, and staff in cities and counties across the country are still working to figure out how deep the economic impact will be and how long it will take to climb out.

“One of the most prevalent theories right now is this recovery is going to be very long and slow,” Taylor said. “It is likely going to take us two years to get to where we ended in December 2019. The economy was really strong at the end of the year and all throughout the year. Everything was ahead of expected. We came into COVID in a really good position. That strength has helped us minimize the cut and the funds balance we’re going to have to use.”

Taylor said the city could benefit from additional federal funding currently in the pipeline — particularly since unlike the CARES Act that funding can be used more flexibly by local government. There were still concerns, Taylor said, that more federal funding for local governments will mean Virginia will feel less obliged to continue sending funding to localities. Alexandria has used CARES Act funding for programs like rental assistance and small business grants.

“The one concern about the federal government providing additional flexible monies is it might lessen the need from the state to push down the second traunch of CARES funding,” Taylor said. “[We’re] continuing to make the argument that the spirit of the CARES funding is direct that it impacts in localities and that the services provided closest to the problems are the best services.”

Staff photo by James Cullum

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