Town makes final offer to county for corridor money

Front Royal leaders sent possibly their final offer to Warren County on revenue collection from the U.S. 340-522 Corridor.

Town Council agreed Tuesday to propose to the Board of Supervisors that the county pay the equivalent of 33 percent of the meals taxes and 15 percent of the lodging taxes collected in the corridor. This marks the fifth offer put on the table by either side since council started making proposals earlier this year.

Council plans to give supervisors until mid July to respond to the new offer. Should the board decline to accept the latest terms, council plans to take action as early as July 27 to consider the town’s collection of the equivalent of meals and lodging taxes from the corridor through a Payment In Lieu Of Taxes [PILOT] scheme.

Specifically, council voted unanimously to have Town Manager Steve Burke send a revised letter and memorandum of agreement to the county outlining the proposed terms in a resolution on corridor funding.

The agreement would exclude the Crooked Run West parcels from the revenue collection scheme. The idea of the county limiting Front Royal’s ability to collect PILOT fees from the as-yet developed Crooked Run became a sticking point with some council members.

The supervisors’ last offer called for the county to pay the town the equivalent of 30 percent of the meals tax collected. Supervisors proposed no percentage amount from lodging tax for the town.

Councilman Daryl Funk said Wednesday that members could not reach a consensus on whether or not to accept the county’s counter offer.

Councilman Bret Hrbek opposed the county’s last offer and “reluctantly” voted in support of the town’s new proposal.

“I’m not keen on the offer,” Hrbek said. “I think we’re still offering the county a phenomenal deal in the revenue-sharing area.

“But I thought we should have at least one last olive branch in good faith, in good will, to try to settle this before we have to move on to voting on lifting the moratorium on the collection of the meals and lodging portion of the PILOT.”

Hrbek said the resolution he supported sets a final date for the vote to begin collecting PILOT fees as outlined in the corridor agreement of 1999. The agreement, as some council members interpret, allowed the town to begin collecting PILOT fees from certain businesses in the corridor once the moratorium ended about five years ago.

Whether or not council passes the resolution remains uncertain, but setting the date “signals the county that this is our final offer and that they either need to take this or we will be voting on that … which is not good for anybody, frankly,” Hrbek said.

Businesses in town remain at a disadvantage as the corridor continues to develop, Hrbek said.

The town cannot collect meals and lodging taxes from water and sewer customers in the corridor if the contracts do not explicitly include those levies, Hrbek said. Newer contracts include that language but, on the advice of previous legal counsel, town leaders chose not to collect meals and lodging taxes and imposed a moratorium on collecting such levies. Town Attorney Doug Napier has provided a different opinion and council plans to consider ending the moratorium.

Some council members say this is the final offer they will make before the town moves to resume collecting meals and lodging taxes from the corridor. Others might feel differently, Funk said.

“I am of the opinion that whatever we can do to move forward, to bring the two sides together, to move to enable us to bring in commercial development that keeps taxes low and also helps us keep water rates low and that’s the objective I want to get to,” Funk said. “I want to get us a Chick-Fil-A and a Kohl’s and the only way we’re gonna get there is if the two sides can work this out.”

Contact staff writer Alex Bridges at 540-465-5137 ext. 125, or abridges@nvdaily.com