10/30/2026
Understanding the Proposed 1% Sales Tax Referendum
➡️On November 3, 2026, voters in the City of Covington and Alleghany County will have the opportunity to vote on a proposed additional 1% local sales tax to help fund school construction and major capital improvements.
➡️This is part of a broader statewide discussion: 47 Virginia localities are considering the 1% sales tax option on the November 3 ballot as a way to help fund school capital projects.
☝️Here are some facts to help explain the proposal:
➡️How would the tax change?
- The local sales tax rate would increase from 5.3% to 6.3%.
- That would mean an additional $1 on a $100 taxable purchase, or $5 on a $500 taxable purchase.
- Certain purchases, including qualifying grocery food and prescription medications, are exempt under Virginia law. Gasoline will be exempt from the tax. Other exemptions may apply.
➡️How much money could it generate?
- The estimated combined annual revenue is approximately $1.55 million.
- These are estimates; actual collections would depend on taxable sales.
- It is estimated that 30% or more of the revenue could come from people who live outside the area, including visitors and shoppers.
➡️What could the money be used for?
The revenue would be dedicated to eligible school construction and major capital improvements, such as building renovations, roof replacements, and HVAC upgrades. It would not be used for teacher salaries, employee benefits, routine operating expenses, or everyday classroom supplies.
➡️What about grants?
Grants can help schools pay for certain projects, but grants for major capital improvements are limited. Many education grants focus more on instruction, student programs, technology, and school safety. Capital improvement grants are often competitive and may not cover the full cost of a project.
➡️How does this compare to the Virginia Lottery?
Virginia Lottery profits support public education statewide through state funding. The proposed local sales tax would be a separate source of local revenue dedicated to eligible school capital improvements.
➡️How long would the tax be in place?
The proposal would authorize the additional tax through June 30, 2046, if approved by voters.
➡️For additional background, these articles discuss the broader issue of school construction funding across Virginia:
- Virginia Mercury: https://virginiamercury.com/2026/10/05/virginia-localities-weigh-1-sales-tax-for-school-construction-as-voters-decide-on-expansion/
- Cardinal News: https://cardinalnews.org/2026/10/27/in-rural-virginia-school-construction-needs-are-bringing-republicans-and-democrats-together-on-1-sales-tax/
⚠️This post is intended for informational purposes only and is not an endorsement for or against the referendum.
