Public Comments for 01/21/2021 Finance - Subcommittee #1
HB1939 - Food and beverage tax; single-serving salads, definition of "single-serving."
I am IN FAVOR of the proposal to more clearly define and reference the federal standard definition. This is a more logical, fair, and consistent measure of defining how this regulation should be applied uniformly across the commonwealth. I buy a salad each week from Dreaming Tree Farm and want to reinforce that it is not a single serving product. If my husband and I only have salad for dinner it feeds two of us and if I add a slice of chicken or two with it, it will make salads for both us for two days. I feel it is unfair to penalize small businesses with what I see as an unfair tax. Dreaming Tree Farms provides a service for older people and provides an easy affordable way for us to get healthy food into diet without a trip to the grocery store. These services should be promoted not taxed out of the market.
While we understand that the intent of this legislation is to address a specific situation, applying a definition of serving size drawn from nutrition guidelines in this tax statute would create unintended consequences that go beyond the issue that prompted the bill and potentially create challenges for meals tax collections on similar food items sold by restaurants.
I am in favor of referencing the common sense, federally recognized standard for serving size for prepacked salads. Further, I feel several comments of opposition in this thread do not have merit as currently stated. I kindly ask for further clarification or a change of opinion from the following:>>>>1.Virginia Restaurant, Lodging & Travel Association: commonplace, digital Point of Sale (POS) systems are intended for frequent changes. I don’t think doing what is right (e.g. aligning definitions for commonly recognized terminology and fair application of tax code) should be delegitimized by what is perceived as “slightly inconvenient” (e.g. point of sale system changes). Further, the code wouldn’t dictate the volume of food a restaurant can serve, but rather apply a standard to how many servings that volume of food equates. One package/sellable unit of food may contain more than one serving.>>>>2.Horbal: First, I do not see you on the Commissioners of the Revenue Association of Virginia webpage in any acting leadership position, yet the website names individuals in the following roles as President,1st VP, 2nd VP, 3rd VP, 4th VP, 5th VP, Past President, Secretary, or Treasurer. Since I do not see you listed -- do you have the authority to represent the whole COR Association or are you speaking as a private citizen? Second, you state “all serving sizes are subjective as is the definition by the FDA” which is incorrect. A definition is NOT subjective, by definition. Third, you say: “This bill will place significant administrative burdens on local commissioners by requiring them to make a subjective determination” which cannot be true because local commissioners are CURRENTLY making subjective determinations of pre-packaged salads given lack of a standard (objective) definition to adhere to. So by your argument, the Local Commissioner determination should be easier, more standard, more consistent, and more fair once a standard definition for single serving salad is in pace. Fourth and lastly, you state “this bill will have far reaching effects on the meals tax for many other businesses who sell single-serving salads” – can you please expound on that rather than simply hyperbolizing?>>>>>In summary, I see in this thread of comments a lot of logical, common sense statements IN FAVOR of a clear standard definition. The few comments not in favor offer limited explanation or fact-based justification. I urge the Legislators to support the outpouring of citizen support for this Bill and not get sidetracked by half-baked lobbyist comments opposing this common sense effort.
In favor of the change to reference the Federal Standard definition
A”serving size” should be defined consistently with US Food and Drug Administration standards. The FDA regularly monitors, updates and publishes the Federal Standard of Reference Amounts Customarily Consumed (RACC) tables that are required to be used for food labeling regulations across the nation.
A standardized definition of serving size makes sense. I am in favor.
I am in favor of the change to reference the Federal Standard definition. It is unfair to punish small businesses that are providing terrific products!
I am IN FAVOR of the proposal to more clearly define and reference the federal standard definition. This is a more logical, fair, and consistent measure of defining how this regulation should be applied uniformly across the commonwealth.
I believe in equity and fairness across the board so I vote in favor of this bill.
Local Commissioners of the Revenue oppose HB1939, definition of single-serving salads. This bill is an attempt to exempt a specific meal item sold by one business who claims the salad is not single-serving and is exempt from the food and beverage tax. The food and beverage tax is generally on food for immediate consumption which would indicate that it is a normal serving size however one can argue that all serving sizes are subjective as is the definition by the FDA. This bill will place significant administrative burdens on local commissioners by requiring them to make a subjective determination as to whether a pre-packaged salad meets the serving size definition of the FDA. This complicates the administration of the tax as it would affect all businesses in this situation. Again, Commissioners of the Revenue oppose this bill. This bill will have far reaching effects on the meals tax for many other businesses who sell single-serving salads and will reduce meals tax collections.
Definitions are instrumental in any language because they keep us on the same page by preventing obscurities. Benefits of definitions are to prevent issues, such as the argument at hand. It is ludicrous that there is an argument over an already established definition of a word; a word which is not only recognized but promoted by organizations such as the American Heart Association, American Diabetes Association and most significantly, the USDA and FDA to provide guidance in nutrition and process. "Serving size" is a fundamental phrase. It is what we teach our children as a standard in nutrition and personally, what I learned growing up. It's not meant to be subjective and unfair of anyone who may believe otherwise. Being well aware of the context to which this debate has originated, it is disheartening to know that a small, local farm has had to go through so much strife with the political realm to continue to serve fresh, affordable, local food to the community. I am hopeful that many more will be supportive of this change simply being in favor of the standardization of the concept of language. I am proud of the local farmer who decided that he would not accept what had been allowed yet unfair, by pioneering change for others who may pursue similar endeavors in the future. Farmers work hard enough for us; cutting through red tape should not be on their daily to-do list! In conclusion, YES! I am in favor of this change! I'm in favor of the usage of a word for which it's meaning is intended!
VML Questions the Usefulness of HB 1939 BACKGROUND: Meals Taxes are a significant local revenue. In Fiscal Year 2019, cities, counties and towns collected $425.8 million, $154.6 million and $70.3 million, respectively, for a total of $650.7 million. Because of actions taken by the General Assembly in the regular 2020 session (SB 588 and HB 785), meals tax collections for counties will increase. Meals taxes are levied on food and beverages offered for human consumption. The “carve outs” or exemptions from the imposition of meals taxes include discretionary and mandatory gratuities, food and beverages sold through vending machines, food purchases using “food stamps”, meals provided to employees as part of their compensation, fund-raising for non-profit organizations under certain conditions, and sellers at local farmers markets if the annual income from such sales does not exceed $2,500. The Code of Virginia specifically includes as taxable “sandwiches, salad bar items sold from a salad bar, prepackaged single-serving salads consisting primarily of an assortment of vegetables, and non-factory sealed beverages.” PROPOSAL: HB 1939 would add language to existing Code cites declaring that "single-serving" means the same as "serving" or "serving size" as such terms are defined in 21 C.F.R. § 66 101.9, or its successors. This CFR citation deals with the nutrition labeling of food. It does not appear to address the circumstances in which meals are to be considered groceries. The regulation cited in the bill would define serving “as the amount of food customarily consumed per eating occasion by persons 4 years of age or older which is expressed in a common household measure that is appropriate to the food. When the food is specially formulated or processed for use by infants or by toddlers, a serving or serving size means an amount of food customarily consumed per eating occasion by infants up to 12 months of age or by children 1 through 3 years of age, respectively.” It is unclear to VML how the bill clarifies for the taxpayer and the Commissioner of the Revenue the conditions under which a salad becomes a grocery item. It is not clear what the nexus is between nutrition labeling and taxable food items authorized by the General Assembly. A for-profit enterprise in the business of selling salads for customer deliveries does not mirror the public policy exemptions established by the General Assembly. The bill, as an unintended consequence, could very well lead to granting an unfair competitive advantage for such businesses over “brick and mortar” restaurants. Assuming that this is a local tax issue, we suggest there are processes already established by the legislature to resolve such conflicts. VML believes that passage of the bill will not clarify but will result in more confusion.
In favor of a statewide definition of serving size consistent with the FDA.
I believe food "serving size" should become a standard across the commonwealth and published and monitored like many other FDA regulated criteria
I am IN FAVOR of the change to reference the Federal Standard definition of Serving Size in the Meals Tax Code. Thank you.
I support this legislation as 1) common sense, 2) local farmer-friendly and 3) consumer-friendly. Thank you, representatives, for your support of this clarifying legislation. Local farms are a lifeblood of a community. This legislature connects local farmers with consumers in a meaningful, and removes a structural disadvantage local farmers now faces vs larger, out of state factory farms.
I am in favor of the change to reference the Federal Standard definition
I support the standard FDA definition of serving size being applied to all products.
Please pass this bill to support local farmers in standardizing serving size to FDA standards. When localities determine this (with the intention of producing additional tax revenue), it hurts local businesses.
Please support the change to reference the Federal Standard definition
I support the adoption of a uniform standard for serving size as defined by the FDA. This allows businesses and consumers to make informed decisions, both in the sense of nutrition and in terms of when (and how much) they will be taxed on certain items. Without this change, localities are free to interpret the standard in whatever way suits their interests in a particular case, leading to inconsistent and unfair results.
I am in favor of this change to adopt fair and consistent measures used across the Commonwealth. Virginia businesses should not be at the whim of interpretation by various counties and cities.
IN FAVOR of change. We need to support our local farms.
I am IN FAVOR OF a legislative change to clarify the code and define the term "Serving" for purposes of local food and beverage taxes as having the same meaning as "serving" or "serving size" as those terms are defined in the Code of Federal Regulations (FDA).
IN FAVOR of the change to reference the Federal Standard definition
I am IN FAVOR of the change to reference the Federal Standard definition of Serving Size in the meals tax code. These standards are used across the country for food labels. I believe our Commonwealth’s standards/codes should be consistent with the Federal ones.
In favor of the change to reference the Federal Standard definition.
I'm in FAVOR of this bill to align "service size" to the federal definition.
Absolutely in favor of regulating portion size according to the fda and national standards!! Please please stop allowing counties to arbitrarily tax our local farms in excess when they are supplying healthy locally grown foods. The tax needs to be put on other goods that are not healthy for our communities. Why the heck does our state allow this currently!!! Virginia... we really need to get it together- come back down to earth and help our own people
In favor of FDA standard definition of serving size
In Favor. Should be left undefined!
IN FAVOR of the change to reference the Federal Standard definition
I am IN FAVOR of the change to reference the federal standard definition of serving size in the meal definition
In favor of the change.
I AM IN FAVOR OF THIS BILL. It makes sense to have this definition
In favor of this bill
I agree that this tax should not be applied to the single serving salads that this business delivers.
VRLTA opposes this legislation. While we understand the intent behind this bill, we believe that this bill could adversely impact restaurants by forcing them to change their point of sale systems in order to comply, and could dictate to them serving sizes for their prepackage foods. We urge you to oppose this bill.
Business Context: Dreaming Tree Farms, LLC is a full-time working farm in King William County with an onsite manufacturing kitchen and subscription-based delivery service. Our primary products are farm fresh salads, salad dressings, fresh produce, and fresh eggs. The prepackaged salads are between 15-17 ounces by weight, approximately 3-4 servings as defined by the US Food & Drug Administration (FDA), and are labeled according to FDA food manufacturing standards. The salads vary weekly and are comprised of local salad greens, vegetables, cheese, grains, toppings, and a farm made dressing. We market the product “Farm-To-Salad” as a larger, local version of the bagged salad kits sold in grocery stores that are grown and manufactured by large farm companies on the West Coast. We serve customers via a weekly subscription-based home delivery model and do not service customers on site. All customers receive identical salads each week (no customizations except for allergen variations, no ordering from a menu). The farm is USDA registered and this agri-business is monitored as a Food Manufacturing operation with the VA Department of Agriculture and Consumer Services (VDACS), not as a restaurant or food truck monitored by the VA Department of Health. “Single Serving” Salad Definition: We are at odds with King William Country on the applicability of the Food and Beverage Tax on these multi-serving, manufactured salads. Key to the disagreement is the definition of “Serving.” Principally, we attest that the salad does not meet the definition of “single-serving salad consisting primarily of an assortment of vegetables” as outlined in the VA Tax Code (58.1-3833 and 58.1-3840) King William County has subjectively determined our product is a single serving by their own definition and not that of widely recognized standards. King William County has based this determination on the fact that serving size is not defined in the VA Food and Beverage Tax Code thereby it can be left for individual interpretation at the local level. With this logic, will a “pound”, “square foot”, or “day” also be left for interpretation by individual counties as they are not specifically defined in the code, yet universally accepted standards? Standard Terms. “Serving Size” is a grade school term (4th Grade Standard of Learning) and used ubiquitously throughout our society with a clear standard set by the FDA. Past generations were taught the Food Pyramid and today’s generation is taught MyPlate. Both are national initiatives and central to both is the definition of “Serving”. This has been confirmed with dieticians, physicians, food industry experts, educators, and VDACS. We hope you empathize with the situation and disbelief that this definition be so cavalierly undermined and misconstrued in King William County, seemingly to the detriment of common treatment by the law. In failing to define this term, the Commonwealth is leaving this definition open to interpretation by individual localities, and the definition of “Serving Size” now changes as you cross county lines. Based on a legal review, ad-hoc determinations such as this are prohibited by Virginia law (Volkswagen v. Smit, 279 Va. 327, 337, 689 S.E.2d 679 (2010)). Proposed Change: This proposal will clarify the undefined term, remove inconsistencies across localities, and base the code in widely recognized federal standards thereby eliminating arbitrary determinations.
HB2006 - Energy storage systems; definitions, tax exemption, revenue share for systems.
HB2076 - Motor vehicle sales and use tax; definition of sale price.
The Virginia Transit Association opposes HB2076. This bill will decrease the amount of revenues collected from the motor vehicle sales and use tax; and it will negatively impact all transportation agencies, including DRPT, that receive proceeds from that tax. The 2020 transportation omnibus bill streamlined all transportation revenues to the Commonwealth Transportation Fund and Transportation Trust Fund (TTF), which is where the proceeds from the motor vehicle sales and use tax are deposited. Each transportation agency receives a portion of those funds. The Commonwealth Mass Transit Fund receives 23 percent of the TTF revenues, and the Commonwealth Rail Fund receives 7.5 percent of the TTF revenues. In Fiscal Year 2022, estimated allocations for transit and rail are $604.8M. Funding in the Commonwealth Mass Transit Trust Fund are used for five purposes: i) statewide operating assistance to Virginia’s 40 transit agencies; ii) statewide capital assistance to those same agencies; iii) capital and operating assistance to one of the largest transit agencies in the United States, the Washington Metropolitan Area Transit Agency; iv) the Transit Ridership Incentive Program that funds commuter bus services and reduced and zero-fare programs; and v) transportation demand management programs. The Commonwealth Rail Fund provides funding for the Virginia Passenger Rail Authority and its capital and operating programs for Amtrak Virginia as well as freight and planning programs administered by DRPT. We ask you to reject this bill because it reverses course of our progress achieved in last year's Omnibus Transportation bill. Thank you, Lisa Guthrie Executive Director Virginia Transit Association
HB2165 - Tax delinquent property; sale of land for delinquent taxes.
The Treasurer’s’ Association was involved in the drafting of the bill in order to ensure that the mechanics of the bill would work. We appreciate that opportunity and support the bill as introduced. We believe it will provide a cost-effective, practical way for persons have unrecorded, inherited interests, and potential interests, to participate in the tax sale process without having to hire a lawyer to intervene.
My name is Michael Carter Jr., an eleventh generation Virginian and farmer, and 5th generation legacy farmer at Carter Farms in Orange County Virginia. I, and my organizations Carter Farms and Africulture want to express our support for bill 2165, extending the time period on tax sales. This bill gives the approximately 43,000 small farmers and many more landowners, more opportunity to keep their land when they may hit hard or unfortunate times. Thank you.
The Virginia Poverty Law Center has been focusing on homeownership because homeownership is usually a tremendous financial boost that can both lift people out of poverty and help close the racial wealth gap. We support this Bill because it improves the likelihood that a homeowner behind on her taxes would be able to pay what is owed over time and avoid loss of the home to a tax auction. We also appreciate the recognition that often the delinquency in taxes is due to the fact that the property is owned by many people jointly as heirs. A 2019 report from the United States Department of Agriculture: Heirs’ Property and Persistent Poverty among African Americans in the Southeastern United States found the following: “Historically, relatively few African Americans in the Southeastern United States (the “South”) wrote wills; there were few African-American lawyers, and most White lawyers of the courthouse gang did not inspire trust. As a result, upon death, property in the form of homes and land was distributed as undivided shares among surviving kin. As generation followed generation, title to such property became ambiguous or “clouded,” sometimes with scores or even hundreds of claimants. This phenomenon, known as heirs’ property, is an overlooked contributing factor to persistent poverty among African Americans in the South. “ “Heirs’ property is vulnerable to loss through failure to pay property taxes … In a situation where many individuals own a share in heirs’ property, and where many of these individuals have moved away and lost connection to the land, it is sometimes difficult to ensure that property taxes are paid.”