Mayor Danny Avula, flanked by Richmond Public Schools Superintendent Jason Kamras and members of Richmond City Council and School Board, speaks to reporters at City Hall on July 23 about the upcoming referendum for a 1% sales tax increase. (Photo by Scott Bass)
The city of Richmond and Chesterfield County are all in: This fall, both will ask voters to approve a 1% sales tax increase earmarked specifically for school construction, thanks to enabling legislation that passed in the General Assembly earlier this year.
Richmond City Council and the Chesterfield Board of Supervisors voted in July to place the measure on the ballot Nov. 3. They’ll join more than 40 localities in Virginia, including Powhatan County, that see the potential 1% hike as an opportunity to bank much-needed capital funding.
The additional tax would apply to retail purchases and food sales but won’t be levied on most groceries and personal hygiene products. By law, it also must sunset 20 years after voter approval.
“We have a rare and unique opportunity to rapidly accelerate the work of building better schools for more children,” Richmond Mayor Danny Avula told reporters during a press conference at City Hall on July 23. “Ten of our school buildings in our city are more than a century old. … An assessment that was completed by Richmond Public Schools back in 2024 documented persistent problems with roofing, with HVAC systems, general wear and tear in school after school.”
The additional tax would generate roughly $47 million a year, Avula said, which could finance up to $850 million in new school capital projects.
Superintendent Jason Kamras, who joined Avula along with several City Council and School Board members on July 23, called the referendum a “generational, life-changing opportunity for the children of Richmond.” The school system’s capital needs, he said, are “at minimum, a billion-dollar challenge.”
Few voters would disagree that many of the city’s existing schools are in desperate need of renovation, or outright replacement. Richmonders, however, already carry the highest tax burden in the region — real estate taxes are 40% higher in the city than in Chesterfield, for example, while meals taxes are more than double. Many voters also distrust City Hall, thanks to decades of fiscal mismanagement.
Meanwhile, the Avula administration has struggled with transparency issues and famously fought efforts to lower the real estate tax rate during his first year in office. At the same time, Avula pushed for pay raises and increased severance packages for senior staff.
If the referendum passes, Avula said he’ll ask City Council to reduce the meals tax by 1% and the city’s real estate tax rate by a penny.
“The Avula administration hasn’t been without its fairly significant missteps,” says Bob Holsworth, a longtime political analyst and observer of city politics. “The question is whether people’s interest in supporting schools overcomes some of the distrust they have of the Avula administration.”
South of the river, Chesterfield sees its referendum proposal as a chance to accelerate six already planned school capital projects costing between $250 million and $300 million. If approved, the 1% sales tax increase is expected to generate $65 million to $70 million a year.
The capital needs in the county, however, appear less urgent. In January, in fact, officials boasted that Chesterfield was on the verge of eliminating all classroom trailers at county schools, citing plateauing enrollment numbers and “additional capacity from a series of ongoing capital improvement projects.”
While Chesterfield is widely regarded for its financial management and fiscal discipline, county voters are traditionally allergic to tax hikes. In 2013, 56% rejected the last referendum — a proposed 2% meals tax, also for school construction.
“We’re in a good spot on the capacity side,” said Matt Harris, interim county administrator, during a press briefing in early August, “but being able to catch up and get in a really favorable position on condition and maintenance and capacity at the same time? I don’t know … of any time in our modern history where we’ve been able to maintain both of those. And this is an opportunity to do just that.”
Like Richmond, Chesterfield plans to lower other taxes if the referendum passes. If voters oblige, Harris said the county board pledges to cut the real estate tax rate by 2 cents and the personal property tax rate by 10 cents.
Chesterfield’s biggest challenge, Holsworth said, may be convincing voters who are upset over recent data center developments, which have been sold as tax-revenue behemoths. “If data centers are really providing this much benefit, why do we need to pay the extra tax?” he posits, “because that’s usually the argument for data centers.”
Chesterfield and Richmond offer a study in contrasts: One desperately needs the tax revenue but has public trust issues; the other has fewer trust issues but isn’t desperate for new money. Yet both are playing the proverbial shell game. While raising the sales tax distributes the tax burden more broadly — almost everyone will pay, in other words — voters may find it more palatable to target specific industries, like restaurants or hotels.
“You could make the argument, or have the expectation, that people who are eating out a lot have disposable income — and therefore maybe they’re more able to bear the tax burden,” explained Hayes Holderness, a law professor at the University of Richmond who specializes in tax policy. “The old adage is that taxation is the art of plucking the feathers from the goose with the least amount of squawking.”
