Staff briefs council on new state option to separate vehicle and business personal-property rates; staff counsel caution

City staff and a commissioner briefed the Manassas City Council on April 7 about a recently clarified state option that allows localities to set a separate vehicle tax rate distinct from other tangible personal‑property rates, and they advised restraint in using the new flexibility.

A presenter told the council the General Assembly removed a previously scheduled expiration for a temporary option that lets jurisdictions create a separate vehicle tax rate distinct from their general tangible personal-property rate. "So now you can create a vehicle tax rate that is separate from your general tangible personal property tax rate," the speaker said, explaining that the change creates flexibility to set different rates for cars versus data‑center or other business property.

At issue: several Northern Virginia jurisdictions have already proposed or advertised differing rates for data centers and automobile personal‑property taxes. The presenter said higher rates on data-center property and lower car rates are legally possible under the updated state option but warned of political and revenue risks. "My suggestion would be to leave us at $3.60 and let Prince William and Loudoun be our guinea pigs," the presenter said, arguing Manassas should watch early adopters before acting.

Comparisons and examples cited in the briefing: staff referenced surrounding jurisdictions’ advertised or proposed rates, including Fairfax (advertised about $4.57), Loudoun (advertised $4.15 for data‑center/business personal property and a lower car rate in materials cited), Stafford (about $5.07), and Prince William (advertising $4.15 for data centers and $3.70 for cars). The presenter said those numbers could still change, and that the city’s expected direct revenue from data centers is likely to be limited for at least a year or two.

Why staff recommended caution: the presenter and other speakers said data-center owners have strong lobbying capacity and the policy could be reversed or altered at the state level; adopting a high general rate now could create political difficulty if the state later limits or reverses the authority. Council members asked for time to study potential revenue scenarios and political consequences before pursuing any immediate local rate splits.

No formal action was taken; staff recommended monitoring neighboring counties and awaiting additional information before proposing any local rate changes.