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1 cent sales tax option may get a shot in spring

By Karissa Minn
kminn@salisburypost.com
SALISBURY ó A bill to allow Rowan County to keep the stateís expired 1 cent sales tax may have stalled in the General Assembly this year, but a local legislator said some changes could give it more fuel next year.
On May 17, the Rowan County Board of Commissioners unanimously agreed to ask legislators to allow a local referendum to keep the tax.
Commissioner Carl Ford said Thursday that a 1 cent sales tax can bring the county $7.5 million to $8.5 million, while the same rate increase in property tax only brings in about $1 million.
The county could use the additional revenue to end its own quarter-cent sales tax, lower its property taxes and help fund local schools.
ěA lot of people donít like taxes at all, but weíve got to have income from somewhere,î Ford said. ěWith a penny sales tax, everybody pays equally.î
N.C. Reps. Fred Steen and Harry Warren had asked Ford, the boardís legislative liaison, if Rowan wants the local option.
Still smarting from the sting of the stateís budget cuts and mandates, commissioners sent their request but didnít specify how the money would be spent. The county, they said, should have control over how it uses a tax the state gave up.
But finance committee members were reluctant to consider allowing the tax without knowing what it would fund, Steen said.
He said commissioners ěsaid they donít want any strings attached, but itís not easy to sell that to a committee thatís worried about fiscal policy, tax policy and revenue policy.î
Steen said Thursday that he tried to introduce the local bill as a committee substitute for a different one, but he couldnít get enough support before the long session ended this summer.
The bill might pass in the short session next spring if itís more specific, he said. Will all of the revenue be balanced by tax cuts, he asked, or will the county spend some?
ěIf itís totally revenue-neutral, itís a no-brainer; I donít foresee them having a problem with that,î Steen said. ěIf itís not, weíre going to have to do a better job of selling what the other part is going to be used for.î
Ford said if voters approved the 1 cent sales tax, the county would reduce its own taxes and fund education.
He doesnít mind if legislators add broad conditions like that, but the county should choose how to split the revenue and whether that split will change over time, he said. If commissioners approved a referendum, it would be up to local voters to decide whether they agree.
ěIf we got the penny sales tax, the only way Iíd vote for it to go on the ballot … is if we roll back property taxes,î Ford said.
The county raised its property tax rate last month from 59.5 cents to 62.25 cents per $100 of assessed value. Ford and Commissioner Jim Sides both criticized the 2.75-cent increase when they voted against the general fund budget at the boardís June 21 meeting.
The first 2.5 cents of the rate hike is a revenue-neutral adjustment after the 2011 revaluation. The additional quarter-cent tax increase will pay for debt from a bond for Rowan-Cabarrus Community College.
If the local bill had passed this year, commissioners could have approved the tax referendum in time for it to appear on the ballot this November. The sales tax could have become effective in July 2012 and started bringing in money for the county three months later.
If it is approved next year, Rowan County wonít have the chance to benefit until the fall of 2013.
Contact reporter Karissa Minn at 704-797-4222.
Twitter: twitter.com/postcopolitics
Facebook: facebook.com/ Karissa.SalisburyPost

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