A Richmond, Va., performing-arts organization is asking the city for a $1.75-million infusion to pay an unexpected tax bill arising from its use of a dedicated for-profit entity on renovation projects, reports the Richmond Times-Dispatch. Richmond Performing Arts Center said it anticipates getting the bills next year on the city-owned Altria Theater and Richmond CenterStage.
The center, which operates the two venues, created a business called RPAC Inc. to take advantage of historic tax credits for work on the two buildings but apparently failed to take into account a state law requiring companies to pay real estate taxes on leasehold interests in publicly owned properties that would otherwise be tax-exempt.
An aide to Mayor Dwight C. Jones told a City Council committee Thursday that without help, the theaters would have to substantially raise ticket prices or the rents charged to performance groups. The committee recommended tapping the city's rainy day fund to provide the money, which would effectively come back to municipal coffers as tax payments.