Announcements‎ > ‎

Stafford to Reduce/Remove the Boat Tax for 2013?

posted Jan 25, 2013, 4:52 AM by Unknown user

Stafford may torpedo boat tax


Jimmy Franklin wondered why every year it seemed like more and more boats were leaving his Hope Springs Marina.

A waiting list used to be the only way boat owners could secure one of the 180 slips at the marina on Aquia Creek, which can store up to 500 boats.

But that list is long gone, despite a recently constructed clubhouse, and the boats that are stored have gotten smaller, said Franklin, the managing partner.

Customers told him that the only thing wrong was out of his control: His marina is in Stafford, also known as “the county with the big boat tax.”

The personal property tax rate on boats in Stafford is the highest of six counties in the region with water access, including Fairfax and Prince William. Each boat is assessed at $5.49 per $100 of boat value, based on 40 percent of its market value, according to Commissioner of Revenue Scott Mayausky. That means the rate comes to about $2.20 per $100 of boat value, more than twice the rate on land and houses.

“Hope Springs Marina will never be able to compare to Prince William County Marina, as long as this crushing tax is in place,” Franklin told Stafford’s Board of Supervisors recently.

He was joined by several others in the boat industry who say business would improve if the tax was erased.

After years of discussions, the Board of Supervisors may make 2013 the year of the boat.

State code prohibits removing the tax altogether, but the county could reduce it to a fraction of a penny, essentially making the tax null on everything except million-dollar crafts. The board has asked for an impact analysis of such a reduction. The final decisions for the fiscal 2014 budget and tax rates typically come in late spring, following public hearings on both.

Supervisors plan to study three scenarios for the personal property tax on boats: reducing it to nearly nothing, implementing a three-year phaseout or keeping it as is.

If eliminated, the county could lose at least $500,000 in revenue for the general fund. But marina owners say the increase in business would make up for that. Mayausky is doing an internal study to assess that claim.

A change in assessment methods of boats means bills may already drop somewhat this spring, said Mayausky.

On the first of the year, his office takes an inventory of boats that are parked and docked in Stafford. Essentially, if they’re in the county for the majority of the year and not taxed elsewhere, Stafford can collect taxes.

Marinas send in a list of boats on site, and the county checks state and federal registrations to see who else in Stafford owns a boat. Then, they all receive tax bills, which can range from a few dollars for kayaks and canoes, to tens of thousands of dollars for the newest, largest boats.

“It is very difficult to assess and collect because the boats are so mobile, compared to real estate that doesn’t move. That always makes it a difficult tax to administer,” Mayausky said.


This isn’t the first time that the issue has been pushed locally, or statewide.
In 2011, Sen. Richard Stuart, R–Stafford, proposed a partial tax exemption for boats to encourage owners to keep them in home waters. The measure failed.

Supervisors are expected to reduce the tax to essentially nothing. The initial revenue forecast presented to the board by county staff during a budget meeting Saturday included a zeroed boat tax.

“I’ve seen enough evidence that it would be economically advantageous,” Aquia Supervisor Paul Milde said last month, calling the tax “punitively high.” The owner of a jonboat, Milde has pushed for a lower tax for years.

Marinas believe that having more—and larger—boats stored in their slips would offset any loss to the county revenue by creating jobs at marinas and bringing in more sales and fuels taxes.

The majority of Stafford’s 5,000 boats are under 17 feet long. Those bring in $85,000 in tax revenue. The 2,270 boats over 18 feet bring in $532,000. All taxes go into the county’s general fund.

George Paxson, manager at the Aquia Bay Marina, asked county supervisors to “sink” the tax to encourage economic growth.

“In my opinion, it’s a real disincentive to the marina industry,” he said in an interview. “It’s not like a vehicle tax. Our boats don’t ride on the road—they’re in the water.”


At the end of the past boating season, Paxson said the marina lost nine boats. The bigger boats rarely return because of logistics and costs of moving, he said.

So, where do the boats go? Marinas repeatedly point to northern neighbor Prince William County, where there is plenty of water access and virtually no personal property tax on boats.

Prince William County Marina, the largest marina there, is just 22 miles from Stafford Courthouse.

Owner Carlton Phillips said that since Prince William essentially zeroed its $3.70 tax rate in 1998, business has picked up in the area, from restaurants to dry cleaners.

“The real story behind it is not just my business, but everyone around me has improved,” Phillips said.

Repeatedly named the No. 1 dealer in North America by Boating Industry Magazine, the marina employs 60 people and stores 700 boats.

“Our business has grown because we haven’t had taxes,” Phillips said.
That’s what Stafford’s marina owners hope to be able to say years from now.

On a recent January day, only a handful of boats floated in the water at Hope Springs Marina. Boating season is far off, after all.

Franklin, the managing partner, looks forward to the day when the slips are filled with more and larger boats to keep his business afloat.

“We’ve got a huge investment that was meant to be fed with a full marina, and big boats,” he said.

Katie Thisdell: 540/735-1975

By Phil Jenkins on January 14th, 2013 8:38 pm