Virginia Beach City Council Special Formal Session - April 15, 2026
Virginia Beach City Council Special Formal Session - April 15, 2026
This special formal session was called to conduct public hearings on the Fiscal Year 2026-27 operating budget and capital improvement program, bond authorizations (totaling $72.8 million in general obligation bonds, $22.5 million in water and sewer revenue bonds, and $21.1 million in stormwater revenue bonds), boundary adjustments for the Town Center Special Service District, and creation of the Pembroke Square Special Service District. However, the overwhelming majority of the 15 public speakers focused on opposition to the city's 6% prepared meals tax, calling for reduction or elimination. Additional comments addressed personal property tax exemptions for people with disabilities, community organization grants, and general budget priorities.
Public Comments & Testimony
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Meals Tax Opposition (14 speakers): Multiple restaurant owners, employees, and residents voiced strong opposition to the 6% meals tax (stacked on top of the 6% state sales tax for a total of 12%). Key arguments included:
- Marissa Ferguson (13-year restaurant industry veteran) described razor-thin profit margins (3-5%) and said the tax forces customers to skip items or stay home, leading to reduced employee hours. She noted that most U.S. cities charge 0-1% meals tax.
- JB Moss (Virginia Beach Restaurant Association) criticized the tax as "cancerous" and called for fairness, stating 87% of U.S. cities have zero meals tax. He noted the restaurant association’s combined social media reach of 1.5 million followers and expressed desire for a partnership with Council.
- Amber Costa (owner of The Stockpot) argued the tax is the third-highest household tax in FY 2026-27 and that restaurants pay credit card processing fees on the tax amount, absorbing the cost. She cited National Restaurant Association projections of 2-4% profit margins.
- Rebecca Reese (working parent) said the tax adds 12% to family meals, forcing cutbacks on takeout and community dining events.
- Emily Hake (restaurant industry worker) spoke against the tax.
- Davis Steadman (Norfolk Academy senior) presented a school project titled "86 the Restaurant Tax," noting peers are struggling to find summer jobs due to reduced hours.
- Courtney Pritchard criticized the tax and suggested budget cuts (e.g., bike path project, park spending) as alternatives.
- Emily Johnson (employee of Oceanetti and Beach Pub) relayed that coworkers report decreased tips due to the tax; she asked for reduction to 3.5% with eventual elimination.
- Debbie Lou Haig (President of Virginia Beach Restaurant Association) urged reducing the tax to 3.5%, noting tourism growth has already generated increased revenue.
- Vanessa Berger asked to reduce the tax to 3.5% and eventually eliminate it, suggesting alternative funding sources.
- Greg Alcala (District 8 restaurant owner) argued the tax reduces visitation and diner frequency, harming the tourism ecosystem.
- Kevin Sharkey (owner/executive chef of 1608 Craft House, via WebEx) said the tax makes Virginia Beach less competitive and hurts reputation when guests see unexpected charges.
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Other Topics:
- Nicole Davis (Executive Director of the Independent Center) requested continued city investment in community organization grants, reporting outcomes such as 157 residents served, 19 home modifications, and 32 residents receiving benefits counseling.
- Diana Howard (Virginia Beach Tea Party) opposed the 5.2% real estate tax increase, criticized dedicated taxes (e.g., open space, major projects), and said the budget contains sufficient reserves ($163.7 million unassigned fund balance) to reduce taxes. She mentioned a petition for a meals tax referendum.
- Martha Thoreau urged Council to raise the personal property tax exemption threshold for individuals with disabilities (currently $29,000 total income), noting it discourages work and independence. She said the Commissioner of the Revenue recommended this change with minimal revenue impact.
Discussion Items
- No formal discussion by Council members occurred during this public hearing session. Mayor Bobby Dyer concluded by thanking speakers and stating "We hear you."
Key Outcomes
- No votes or formal decisions were taken during the special formal session. The hearing served solely to gather public input for Council’s consideration during the FY 2026-27 budget process.
Meeting Transcript
Honorable members of City Council and our esteemed audience. In accordance with Virginia Beach City Code 2-21 and by the authority vested in me as the mayor of the City of Virginia Beach, I hereby call for a special formal session of the Virginia Beach City Council. On Wednesday, April 15th, 2026 at 6 p.m., Virginia Beach Convention Center, 10019th Street. The purpose of the special formal session is to conduct public hearing to obtain public input regarding first the fiscal year 2026-27 operating budget and capital improvement program. Next, the authorization of 72,827,365 in general obligation bonds. Authorization of 22,506 in water and soar utility revenue bonds. Authorization of 21,057,315 stormwater utility revenue bonds and loan precedes. Boundary matrification for Town Center Special Dis uh District, and create the Pembroke Square Special Service District, SSC, and dedicate certain tax revenues to the project. If you wish to make comments during the meeting, please follow the two-step process provided below. Register by WebEx here or register to the city's uh clerk's office by calling 757 385 4303. Um this uh special formal session will be broadcast on uh cable TV, Virginia Beach.gov, Facebook Live. Citizens are encouraged to submit their comments to the City Council prior to the special formal session via email. City Council at VBGov.com. Sincerely, Bobby Dyer. Okay, welcome one, welcome all, and uh Madam Clerk, I think we're ready to get going. The first speaker is Marissa Ferguson. After Ms. Ferguson will be JB Moss. Welcome. Welcome. Thank you for letting me start this off, you guys. So uh good evening, neighbors and esteemed leaders of Virginia Beach. Um, like she said, my name is Marissa Ferguson, and over the last 13 years I've worked tirelessly in the restaurant industry. I know the sweat, the long hours, and the exhaustion that comes with this industry because I live it every single day. Our doors open before the sun, they close long after the sun sets, and I spend the time in between managing staff schedules, food costs, and the constant pressure to keep our doors open. That's why the 6% meals tax stacked on top of the 6% sales tax for a crushing 12% total feels like such a betrayal to me and every one of us who pours our hearts into feeding our community. Restaurant people work harder than most folks realize. We're on our feet for 10, 12, sometimes 14 hours a day. We sacrifice family dinners, holidays, and weekends so that tourists and locals can enjoy a hot meal after a day at our beaches. Our profit margins are razor thin, often just three to five percent. The city collects more in tax from a single 100 check than we clear in profit after staffing, rent, vendors, and utilities to keep the lights on. When the tax jumped another half percent last July, I watched customers double take their checks and more often than not call me over to explain to them this tax that they assumed we as an independent restaurant were pocketing from them directly. With everything we do to make guests feel welcome and invited into our establishment, this interaction is devastating. The customer is left feeling nickel and dimed after an otherwise pleasant and enjoyable meal. In response, they began to skip the appetizer, pass on dessert, or simply stayed home. Business dropped, and I had to cut hours across the board, front of house and back of house. This means less money in the pockets of people who rely on tips and hourly income to survive day to day. It punishes the entire industry. Most cities across America charge zero or one percent on meals. Virginia Beach chose to make ours one of the highest in the country. It's unfair, it's regressive, and it's damaging the very businesses that welcome millions of visitors every year. Our restaurants are the heartbeat of Virginia Beach tourism, and I urge City Council to cons to listen to the restaurant and restaurant association roll back this tax and give us a fighting chance. We're not asking for a handout. We're asking for fairness so we can keep doing what we love every day, feeding our community and fueling our economy. Thank you very much. Thank you for coming. The next speaker is Jabby Moss, and then Amber Costa. Good evening, Honorable Mayor and City Council. My name is JB Moss, and I'm here to speak out against the Virginia Beach Meals Tax. I researched each of you and how you got to the position you're in, your donors, your campaign promises, and slogans.
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