Tax Type
Local Taxes
Property Tax
Description
Taxation of Residents in Area Annexed to City
Topic
Collection of Tax
Local Power to Tax
Local Taxes Discussion
Property Subject to Tax
Date Issued
02-23-1987
[Opinion - Virginia Attorney General: 1987 at 311]
REQUEST BY: Honorable Dorothy B. Saunders Treasurer for the City of Franklin
OPINION BY: Mary Sue Terry, Attorney General
OPINION:
This is in response to your inquiry whether you may take certain actions in regard to several residents of an area recently annexed to the City of Franklin who refuse to pay their city personal property and real estate taxes. You ask whether your office may (1) charge these residents penalty and interest1 and follow procedures for delinquent tax collection,2 and (2) deny them the right to buy city decals for their automobiles.3
I. Facts
On January 1, 1986, the City of Franklin annexed approximately four square miles of land formerly located in Southampton County. The United States Department of Justice has ruled that the annexation provisions for elections did not conform to the federal Voting Rights Act. Further, the Department of Justice has prohibited citizens in the newly annexed area from voting in any city elections until compliance with the federal Act is achieved.4 Consequently, several such citizens have refused to pay real estate or personal property taxes.
II. Constitution of Virginia Requires All Property Be Taxed Uniformly
In a recent Opinion involving the taxation of annexed territory, this Office noted that Art. X, § 1 of the Constitution of Virginia (1971) provides as follows:
All property, except as hereinafter provided, shall be taxed. All taxes shall be levied and collected under general laws and shall be uniform upon the same class of subjects within the territorial limits of the authority levying the tax, except that the General Assembly may provide for differences in the rate of taxation to be imposed upon real estate by a city or town within all or parts of areas added to its territorial limits. . . .
1985-1986 Report of the Attorney General at 257, 258 (emphasis in original).
Article X, § 4 provides that real estate and tangible personal property are to be segregated and made subject to local taxation. The City of Franklin is empowered to tax such property under § 2.03(A) of its charter. See Ch. 155, 1962 Va. Acts 222, 223. The City of Franklin, therefore, is granted general powers sufficient to tax the newly annexed citizens.
III. Code of Virginia Requires City Treasurers to Collect Tax from All City Residents
Section 58.1-3910 et seq. of the Code of Virginia requires that your office mail tax bills to each taxpayer in your city and receive those taxes and other amounts payable into the treasury of the City of Franklin. § 58.1-1 defines "taxpayer" as
[e]very person, corporation, partnership, organization, trust or estate subject to taxation under the laws of this Commonwealth, or under the ordinances, resolutions or orders of any county, city, town or other political subdivision of this Commonwealth.
Thus, it is clear that your office is required to collect local taxes from the newly annexed citizens of the City of Franklin.
IV. Case Law Supports Taxation of Newly Annexed Citizens
In Duncan v. Town of Blacksburg, Virginia, 364 F. Supp. 643 (W.D. Va. 1973), the federal district court held that unequal voting rights had not been created and that no equal protection violation had occurred by a town's annexation of a surrounding county. This conclusion was reached even though the new residents had not been permitted to vote in elections prior to the effective date of the annexation and the next opportunity for the new residents to vote was more than a year later. The court stated:
Assuming that there may exist, for a limited period of time, some representational disparity between old and new residents of the town, if so, it is temporary, unintended, and self-correcting. Indeed, there is nothing here that would justify the wholesale disruption of local government throughout the State that would result from the recision of the annexation decree, or declaring the Virginia laws invalid. Id. at 646 (emphasis added). See also Avens v. Wright, 320 F. Supp. 677 (W.D. Va. 1970) (upheld constitutionality of Virginia reapportionment statutes which authorized circuit court judges to increase the number of magisterial districts in a county through reapportionment and then to appoint persons to represent the newly annexed citizens on the county board of supervisors).
V. Conclusion: Mere Postponement of Elections in Annexed Area Does Not Excuse Residents from Payment of Taxes
Based on the above, it is my opinion that you may charge the residents of the newly annexed area who are delinquent in the payment of their personal property and real estate taxes penalty and interest and follow usual procedures for delinquent tax collection, and may deny them city decals for their motor vehicles, trailers and semi-trailers until the taxes, penalty and interest are paid. The temporary inability of the new residents to vote in city elections does not preclude you from treating all citizens in your jurisdiction uniformly with regard to local taxation matters.
1 See §§. 58.1-3915, 58.1-3916 and 58.1-3918 of the Code of Virginia.
2 See generally Ch. 39 of Title 58.1.
3 See § 46.1-65(c).
4 While the exact duration of this prohibition is not stated in your letter, it is likely to be resolved in the foreseeable future. Thus, this condition is of a temporary nature.
Attorney General's Opinion