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Council signals interest in exploring higher tax rates for blighted properties
Summary
Legal staff explained a Code of Virginia tool that would allow localities to levy higher rates on qualifying blighted or derelict properties; Hampton qualifies (Physical Stress Index ~105.29) and council polled to pursue further study and possible FY27 implementation.
City attorney staff told the council that state law already permits qualifying localities to impose a higher real-estate tax rate on properties designated as "blighted" (up to 5% higher) or "derelict" (up to 10% higher).
"A qualifying locality is a locality with a score of 100 or higher on the Physical Stress Index," Trish Malicek told council, and she said Hampton's score is 105.29. She explained the distinctions: the "derelict building" designation is narrower (vacant, boarded, without utilities for six months) while "blighted" is broader and easier to apply.
Malicek said the real-estate assessor determines eligibility and recommended that staff develop standardized processes, appeals procedures, and robust public outreach to ensure fair, equitable implementation; the higher levy would be set by ordinance. Council members unanimously indicated in nonbinding preference polling that they wanted staff to pursue analysis, with staff advising implementation would be easier in FY27 after developing administrative procedures.
No official ordinance or vote was adopted at the meeting; staff will return with detailed options, outreach plans and projected revenue or distribution effects if council directs that path forward.
