Virginia Senate Bill SB1161

Virginia 2023 Regular Session

• Introduced: 1/10/23
• Refer: 1/10/23

Caption

Recordation tax; increases annual distribution to cities and counties.

Impact

The increased funding from the recordation tax is intended for vital public services, primarily targeting transportation facilities and public education. The bill mandates that localities use the distributed funds for construction, maintenance, and operational costs associated with transportation infrastructure, which can include highway systems and public transit facilities. The outlined distribution strategy is also designed to ensure that cities and counties can plan effectively for their local transportation and educational needs based on this predictable funding source.

Summary

SB1161 proposes to amend §58.1-816 of the Code of Virginia, increasing the annual distribution from the recordation tax to cities and counties. The bill outlines a structured approach for distributing tax revenues attributable to recorded deeds and other instruments, ensuring that local governments receive a more significant share of funds than in previous years. Specifically, it proposes an increase in the annual distribution of funds from $20 million to $60 million as of July 1, 2023, thereby providing additional resources for local services and infrastructure improvements.

Contention

While supporters of SB1161 argue that the enhanced funding will greatly benefit local governments by providing essential resources for infrastructure and public education, some may raise concerns about the distribution frequency and mechanism. There might be debates around ensuring that the funds are allocated efficiently and reach the intended projects without bureaucratic delays. Moreover, stakeholders may question whether the new formula for distribution fairly addresses the needs of all localities, particularly those that may not generate as much revenue through recorded deeds.