19741203 r-74-23RESOLUTION NO. R-74-23
WHEREAS, the Supreme Court of Virginia has recently declared,
in the case of Virginia National Bank v. CommonWealth of Virginia,
214 Va. ~/~ , 204 SE 2d 426 (1974) that capital notes cannot be
considered a part of the capital of a bank for bank stock tax
purposes within the meaning of Section 58-471 of the 1950 Code of
Virginia, as amended; and,
WHEREAS, the City of Fairfax has heretofore included in its
assessment for bank stock tax purposes capital notes of the Potomac
Bank and Trust Company and the Arlington Trust Company; and,
WHEREAS, the overassessment of the Potomac Bank and Trust
Company amounts to $5,773.60 for the years 1971, 1972 and 1973,
and $1,913.39 for the year 1974; and,
WHEREAS, the overassessment of the Arlington Trust Company
amounts to $36.00 for the year 1973; and,
WHEREAS, said sums have been paid into the treasury of the
City of Fairfax by the said Potomac Bank and Trust ComPany and the
said Arlington Trust Company; and,
WHEREAS, the Potomac Bank and Trust Company, for the years
1971, 1972 and 1973, and the Arlington Trust Company, for the year
1973, have each presented to the City of Fairfax a contract of
indemnity, conditioned upon the fact that said banks will pay said
sums over to their stockholders entitled to the same, in
consideration of a refund of said sums to said banks; and,
WHEREAS, the certificate of A. Howell Thomas, Jr., the
Commissioner of the Revenue of the City of Fairfax, has been
· ' R-74-23 ~
presented to the Council of the City of Fairfax, certifying that
such assessments were erroneous; and,
WHEREAS, it appearing to the Council of the City of Fairfax
that said erroneously assessed sums should be refunded to the
Potomac Bank and Trust Company and the Arlington Trust Company;
NOW, THEREFORE, upon motion duly made and passed,
BE IT RESOLVED by the Council of the City of Fairfax, Virginia,
at its regular meeting held on the 3rd day of December, 1974, that
Frances L. Cox, the Treasurer of the City of Fairfax, be, and she
hereby is, directed to refund to the Potomac Bank and Trust Company,
the sum of $5,773.60, representing an overassessment of bank stock
taxes for the years 1971, 1972 and 1973, and the sum of $1,913.39
for the year 1974, and said Treasurer is further directed to refund
to the Arlington Trust Company, the sum of $36.00, representing
an overassessment of bank stock taxes for the year 1973.
Adopted: December 3, 1974.
Attest:
Ci~y ~ Cl'erk
Theod~~~~
f e,~cting Mayor
R£74-23
MEMORANDUM
CITY OF FAIRFAX
DATE:
TO:
FROM:
COPIES:
SUBJECT:
December 3, 1974
The Honorable Mayor and Members of City Council
The Treasurer of the City of Fairfax
City Attorney and City Comptroller
Certification as to payment of bank stock taxes previously assessed --
Potomac Bank & Trust Company of Fairfax, Virginia, and Arlington Trust
Company of Arlington, Virginia
I, Frances L. Cox, Treasurer of the City of Fairfax, Virginia, do
hereby certify that the over-assessment of bank stock taxes involving subject
banks for calendar tax years 1971, 1972, 1973 and 1974 as delineated in the
memorandum from the Commissioner of Revenue to me dated December 3, 1974, and
in his endorsements to the indemification agreements executed by Potomac Bank
& Trust Company and Arlington Trust Company on November 21, 1974, and November
29, 1974, respectively, have, in fact, been previously paid into the treasury
of the City of Fairfax.
' R-74-23 ~ ~
CONFIDENTIAL
MEMORANDUM
DATE:
TO:
FROM:
COPIES:
SUBJECT:
CITY OF FAIRFAX
December 3, 1974
The Honorable Treasurer of the City of Fairfax
The Commissioner of Revenue of the City of Fairfax
City Attorney and City Comptroller
Certification as to over-assessment of bank stock taxes for calendar
year 1974 -- Potomac Bank & Trust Company of Fairfax, Virginia
I, A. Howell Thomas, Jr., Commissioner of Revenue in and for the
City of Fairfax, virginia, do hereby certify that as of December 2, 1974, I
have verified by means of letter advice dated November 29, 1974, and re-
ceived by me on December 2, 1974, from Mr. Raymond E. Dobyns, Excise and
~License Tax Supervisor of the Virginia Department of Taxation, who exer-
cises supervision over bank stock taxes in the Con~nonwealth of Virginia,
together with a corrected copy of the pertinent bank's 1974 Bank Stock Tax
Return that the 6ank stock taxes for calendar tax year 1974 as levied by the
City of Fairfax against the shareholders of Potomac Bank & Trust Company of
Fairfax, Virginia, were over-assessed in the amount of nineteen hundred
thirteen and thirty-nine one hundredths dollars ($1,913.39).
R-74-23
C;OMlqONWEALTI+
DEPARTMENT Of TAXATION
RICHMOND 23282
November 29, 1974
Mr. A. Howell Thomas, Jr.
Commissioner of the Revenue
City of Fairfax
Fairfax, Virginia 22030
Dear Mr. Thomas:
This is to advise that we are certifying to the State Comptroller
an order authorizing a refund of certain bank stock taxes to the Arling-
ton Trust Company for the years 1971, 1972 and 1973, as a result of the
exclusion of the capital notes from the bank's capital for bank stock
tax purposes.
This bank had a branch in Fairfax City only in 1973. Listed below
is the amount of bank stock tax that was paid by the bank to the City
of Fairfax for 1973 and the correct amount and the difference:
Amount Paid
Corrected Amount
Difference
1973 $261o92 $225.92 $36.00
If you need additional information, please let us know.
Very truly yours,
Miscellaneous Tax Section
Sales and Use Tax Division
RED/ldc
R'74-23
DEPARTMENT OF TAXATION
RICHMOND 23282
~ovember 29, 1974
Mr. A, Howell Thomas, Jr.
Commissioner of the Revenue
City of Fairfax
Fairfax, Virginia 22030
Dear Mr. Thomas:
This is to advise that we are certifying to the State Comptroller
orders authorizing refunds of certain bank stock taxes to the Potomac
Bank and Trust Company for the years 1971, 1972 and 1973 and 1974, as
a result of the exclusion of the capital notes from the bank's capital
for bank stock tax purposes.
For your information, listed below for each year in question is the
amount of bank stock tax that was paid to the City of Fairfax by the
Potomac Bank and Trust Company, the correct amounts and the differences.
- Corrected Amount Difference
Amount Paid --
1971 $4,157.22 $2,221.42 $1,935.80
1972 $4,723.28 $2,795.08 $1,928.20
1973 $5,545.9~ $3,636.32 $1,909.60
1974 ~6,582'4~ ~4,669.0~ ~1~913.3~
Totals $21,008.82 $13,321.83 ·$7,686.99
If you need additional information, please let us know.
Very truly yours,
Dobyns, Su~erviso
Miscellaneous Tax Section
Sales and Use Tax Division
RED/ldc
THIS CONTRACT OF INDEMNITY, made and 'entered into
this 21stday of November
, 1974, by and between
POTOMAC BANK & TRUST COMPANIOf Fairfax ,Virginia,
CITY OF FAIRFAX
its successors and assigns, (the "Bank") and the
f
of Virginia,-its departments, agencies, officers, agents, and
CITY OF FAIRFAX .'
employees (the 'U~Ym~YoY~¥~Y~.~'):
City of Fairfax
In consideration of the agreement of the
hereby made to repay, refund and return to the Bank the sum
of $ 5,773.60 paid by the Bank~ on behalf of its
stockholders, pursuant to §§ 58-465 through 58-485 of the Code
of Virginia (1950), as s~mended~ by reason of the inclusion of
certain capital notes, debentures, and indebtedness to outside
creditors in the 'capital. of the Bank, which sum is refunded
upon condition that the Bank pay said sum over to its stockholders
entitled to same;
The Bank hereby agrees.to indemnify ~ud save harmless the
~~f~om and against an~ ~ud all liability, costs, fees,
City of Fairfax
charge, and expenses the __kZ*YaY~_.~h~E~may hereafter incur as a
result of any assertion, or claim, of liability made against the
City
of
Fair fax
any shareholder of the Bank, past or present,
or his personal rcpresentatives~ successors or assigns, by reason
%
of the inclusion of capital notes, debentures, and indebtedness
to outside creditors in the capital of the Bank for purposes of
the ~ax imposed by §§ 58-465 through 58-485 of the Code of Vir-
ginia (1950), as amended.
R-74-23
THIS Agreement shall be construed according to the
laws o£ the Commonwealth of Virginia.
By r ' , - ,
Title President
Fairfax, Va.,
ATTEST'
"'. Secrstary
ENDORSEMENT
I; A. Howell Thomas, Jr., Commissioner of Revenue in and for the City
of Fairfax, Virginia, do hereby certify that as of this date, November 27, 1974,
I have verified by means of telephone advice from Mr. Raymond E. Dobyns of the
Virginia Department of Taxation that the bank stock taxes as levied against the
shareholders of Potomc Bank & Trust Company of Fairfax, Virginia, were over-assess-
ed for the years and in the amounts shown below. I am assured by Mr. Dobyns of a
confirming letter to this effect for my files.
Calendar year 1971 --- $1,935.80
Calendar year 1972 --- 1,928.20
Calendar year 1973 --- 1~909.60
Total - (1971 - 1973) - $'5,773.60
(The Zetter from Mr. Dobyns re-
ferred to above was dated 11/29/74
and received by me on 12/2/74)
R-74-23 ~ '~
THIS CONTRACT OF IND~ITY, made and ~ntered into
this 29 day of November
, 1974, by and between
ARLINGTON TRUST COMPANY of Arlington , virginia,
CITY OF
its successors and assigns, (the "Bank") and the~%~
FAIRFAX
~x~br~ its departments~ agencies, officers, agents, and'
DITY OF FAIRFAX ?
employees'(the ~mm~m~N~h~:
City of Fairfax
In coJsideration of the agreement of.theC~mmx>ra~nd~m~,
hereby made to repay, refund aud return to the Bank the sum
of $ 36.oo paid by the Bank, on behalf of its
stockholders, pursuant to §§ 58-465 tl~rough 58-485 of the Code
of Virginia (1950), as amended, by reason of the inclusion of
certain capital notes, debentures, and indebtedness to outside
creditors in the 'capital. of the Bank, which sum is refunded
hpon condition that the~Bankpay said sum.over to its stockholders
· entitled to same; , : ~
. ~
The Bank hereby agrees.to indemnify and save harmless the
city of Fairfax
~mmno~m~~ from and against any and all liability, costs, fees,.
City of Fairfax
charges, and expenses thermistOR may hereafter incur as a
result of any assertion, or c'laim, of liability made against the
City of'Fairfax ~
~mm~mm~s~t~R, by any shareholder of the'Bank, past or present,
or his person~! representatives, successors or assigns, by reason
~f the inclusion of capital notes, debentures, and indebtedness
to outside creditors in the capital of the Bank for purposes of
the tax imposed by §§ 58-465 through 58-~85 of the Code of Vir-
ginia (1950), as amended.
' R-74-23
of the Commonwealth of Virginia.
TI{IS Agreement shall be construed according to the laws
ARLIN'GTON TRUST COMPANY,
Title Vice Prgsident/Controller
ENDORSEMENT'
I, A. Howell Thomas, Jr'.~ C6mmissioner'of Revenue in and for the City of '
Fairfax, Virginia, do hereby certify that as of thi~ date, December 2, 1974, I
.have verified by means of letter advice dated November 29, 1974, from Mr..Raymond
E. Dobyns of the V'$rginia Department of Taxation that the bank stock taxes for
calendar tax year 1973 as -levied against .the ~hareholRers of Arlington Trust
Company by the City o'f Fairfax .were. over-assessed, in the. amount Of .$36.00. ..