CITY OF CHARLOTTESVILLE, VIRGINIA
                  CITY COUNCIL AGENDA



  Agenda Date:         August 1, 2022

  Action Required:     Conduct Public Hearing and take action on the second reading of the Proposed
                       Ordinance

  Presenter:           Samuel Sanders, Jr., Deputy City Manager

  Staff Contacts:      Lisa Robertson, City Attorney

  Title:               Plastic Bag Tax (2nd reading and Public Hearing)


Background
During the 2020 General Assembly session, Virginia localities received enabling authority to impose
a disposable plastic bag tax within their jurisdictional limits. The City of Charlottesville continues to be
keenly concerned about the equity impact of such a tax. The legislation allows localities to impose a
five cent ($.05) per bag tax on disposable plastic bags provided by certain retailers.

Recommendations from organizations advocating for this tax focus on the potential benefit of
creating a local source of funding dedicated to environmental cleanup and litter/ pollution mitigation.
Specifically, the argument that pollution and litter disproportionately impact low wealth communities.
Further, the ability to provide funding for reusable bags and environmental education efforts are
intended to mitigate the cost burden from such a tax.

The enabling legislation does include stipulations on the use of the associated revenues. Revenues
from this tax must be used for programs supporting the following:

    1.   environmental cleanup,
    2.   litter and pollution mitigation,
    3.   environmental education efforts, and/or
    4.   to provide reusable bags to SNAP or WIC benefit recipients.


Funding from this tax will not directly or immediately support any administrative responsibilities the
City may undertake to promote this program. Revenue collection and distribution occurs at the State
level and is remitted to the locality exclusively for the purposes listed above. City Staff would likely be
required to engage in outreach to local businesses, agencies providing social services, and citizens
to educate the community about available resources for alternative, re-usable bags. Future City
Councils may have the ability to allocate this remitting tax funding towards providing an ongoing
program for re-useable bags.

Discussion
Council is required to conduct a public hearing to consider the adoption of an ordinance to impose a
disposable plastic bag tax. Virginia Code § 58.1-17.45 through 58.1-1748 grants localities the
authority to impose a five cent ($.05) per bag tax on disposable plastic bags provided by grocery
stores, convenience stores, or pharmacies. Pursuant to Virginia Code § 58.1-3007, “before any local
tax levy shall be increased in any…city…., such proposed increase shall be published in a
newspaper having general circulation in the locality affected at least seven days before the
increased levy is made and the citizens of the locality shall be given an opportunity to appear
before, and be heard by, the local governing body on the subject of such increase.”

The attached proposed Ordinance would amend City Code Chapter 30, Taxation, Article II by adding
Division 3 to impose the plastic bag tax. Durable plastic bags designed for repeated use and plastic
bags used solely to wrap, contain, or package certain goods to prevent damage or contamination are
exempt from this tax. This exclusion would include packaging for ice cream, meat, fish, poultry,
produce, unwrapped bulk food items, perishable food items, dry cleaning, prescription drugs, and
multiple bags sold in containers for use as garbage, pet waste, or leaf removal bags. As referenced
above future revenues from such tax must be used for programs supporting environmental cleanup,
litter and pollution mitigation, environmental education efforts or to provide reusable bags to SNAP or
WIC benefit recipients.

Collection of the plastic bag tax would be performed by the State Department of Taxation. State
Code requires localities to provide a certified copy of the ordinance to the Tax Commissioner of the
Commonwealth at least three months prior to the date the ordinance becomes effective. The
effective date for the disposable plastic bag tax is proposed to be January 1, 2023.

Alignment with City Council's Vision and Strategic Plan
This proposed ordinance meets the City Council vision to be a leader in innovation, environmental
sustainability, and social and economic justice. The ordinance conforms with the Strategic Plan’s
Goal 2 to be a Healthy and Safe City and Goal 3 to maintain a Beautiful Environment.

Community Engagement
Public hearing is required, after publication of notice, per Va. Code Sec. 58.1-3007. The public
hearing will need to be advertised for the date of the second reading of the proposed ordinance.

Budgetary Impact
Imposing the disposable plastic bag tax would increase revenues. However, these revenues would
be dedicated to qualifying expenditures as listed above.

Recommendation
(1) Conduct a public hearing, then (2) consider the adoption of the Proposed Ordinance by motion.

Suggested Motion: "I move the ORDINANCE amending Chapter 30 of the City Code, to
establish a new article 19 (disposable plastic bag tax)"

Alternatives
By motion, Council may decide not to proceed with a plastic bag tax. Council may also elect to defer
the matter indefinitely without moving forward to a public hearing.
Attachments
1.   Ordinance - Plastic Bag Tax