Alexandria Meals Tax Increase for Affordable Housing

Last year, a broad coalition of faith communities, human service organizations and housing supporters in the City of Alexandria successfully engaged in an extensive advocacy campaign to secure public funds for an affordable housing development at the Episcopal Church of the Resurrection. Now City Council is considering several options to provide additional funding for affordable housing. At the February 27 legislative session, Councilman Will Bailey said, ” I’m tired of talking; we say that affordable housing is a priority; we need to do something about it.” Councilman Bailey has proposed that the meals tax be increased by 1% and the new revenue be allocated to the City’s Housing Opportunity Fund. If approved, this action would provide an additional $4.75M annually for affordable housing.

Several factors have elevated the issue of housing affordability and the need for more funding to a head. Since 2000, Alexandria has lost over 17,000 units of older, market-affordable housing due to demolition or renovation with increased rents. That’s a 90% decline in the naturally occurring affordable housing stock in the City. When the City adopted its Housing Master Plan in Dec 2013, Council included a recommendation to create 2,000 new affordable units by 2025 – 200 units annually. However, the latest Progress Report from the Office of Housing indicates that the City is falling behind in meeting that goal.

As development activity has picked upin Alexandria, the Office of Housing reports that there is a pipeline of affordable housing developments in the next 3-5 years, but given the need for subsidy to serve lower and moderate income households, there is a $66 million shortfall in the housing fund to invest in these projects. The potential for losing these projects due to the funding shortfall has advocates asking once again for a reliable, dedicated source of funding.

The Alliance, through our coalition group Housing Alexandria, is working with advocates, faith communities, community-based organizations and civic groups to build support for the meals tax proposal. Although not part of the City’s proposed FY19 budget, it is anticipated that deliberation of additional funding for housing and the strategy that will be chosen will take place in conjunction with budget discussions. If approved, the hope is that the new strategy will be in place by July 1, the start of the fiscal year.

The Alliance has created a fact sheet about the meals tax proposal and the City has provided a thorough analysis of its impact on the restaurant industry and City residents. Recently the Alexandria Times provided a strong endorsement of a dedicated source of revenue for affordable housing on it’s editorial page. We encourage Alexandria housing advocates to weigh in with the Mayor and City Council and let them know that you support a reliable, dedicated source of revenue for housing. Let’s make this an election year issue!