Movie Theater Incentive Agreement For Founders Row Approved By City Council

FALLS CHURCH, VA — A new economic development agreement and terms for the movie theater at Founders Row were approved by Falls Church City Council Tuesday.

The movie theater is a key component of the Founders Row development. The development has opened its residential units and has plans to open restaurants on site. The city negotiated with the developer on a new economic development agreement for Founders Row after a previous 2016 economic development agreement expired in 2021.

The amended terms were approved unanimously 7-0, and City Council voted 6-0 on the economic development agreement with Councilmember David Snyder abstaining.

Under the agreement, the first $20,000 in annual theater admission tax receipts would be kept by the City of Falls Church. Any tax receipts over $20,000 but not exceeding $360,000 would be paid to the development owner through an economic development grant. The theater admissions tax can only be up to 10 percent, per a state limit.

In addition, the first $10,000 in meals tax receipts would be kept by the city, and remaining tax receipts between over $10,000 to $160,000 would be paid to the owner.

The agreement have a 30-year term. An annual 3 percent increase would be applied to the city and owner shares of the tax receipts. However, the increases will not be in effect for the first partial year of less than six months.

If gross revenues from theater operations exceed $13 million in a year, the meals tax part of the incentive would be suspended that year. The meals tax incentive would be ended if there are four consecutive years, and the term of the admissions tax incentive would be reduced to 20 years.

The economic development agreement states the city can end the agreement if certain milestones are not met, including completion of theater work by March 31, 2024 and the theater opening by May 31, 2024.

City Council will also consider changes to terms related to the Founders Row theater. While the theater was previously anticipated to have 750 to 850 seats, it is now estimated to have 601 seats. It is expected to have seven theaters, including an IMAX-type theater, and anticipated ticket price of $12. The developer is also requesting adding arcades as a permitted accessory to the theater.

City Council meets at 7:30 p.m. Tuesday. Patch will provide updates on the Founders Row considerations on Wednesday.