BOC approves budget, lashes out at Senate’s sales tax plan

June 18, 2015 | Local News | By: Sandy.Semans

The Dare County Board of Commissioners passed a $102 million budget for the next fiscal year that requires no increase in property taxes at its meeting on Wednesday, June 17.

And then the board members turned around and denounced the N.C. Senate’s budget plan, which would take $10 to $12 million in sales tax revenue from future county budgets and cause the county to raise taxes by as much as 8 cents or to drastically slash employees and programs.

The board instructed county manager Bobby Outten to craft a budget for the fiscal year that begins July 1 that maintains but doesn’t expand the current service level and works within existing revenue sources.

Under the proposal, Dare County’s property tax rate of 43 cents per $100 dollars of valuation remains the same.

The 2016 budget includes $3 million for the creation of a new special revenue fund that would provide the local match for state and federal funds for inlet maintenance. Under the budget plan, $1.25 million of that will come from anticipated surplus from the current budget year, $1 million will be transferred from the beach nourishment fund, and $750,000 will come from the anticipated sale of the old EMS helicopter.

Under pressure from the county Board of Education and citizens who spoke at a June 1 public hearing, the commissioners found another $400,000 in the budget — without increasing it — to partially fund an anticipated $514,000 increase in salaries for starting teachers mandated by the General Assembly.

With the budget out of the way, board Chairman Bob Woodard turned the conversation to the effort in Raleigh, led by Sen. Harry Brown, a Republican from Onslow County, to change the way the state distributes sales taxes to the counties.

The current formula distributes sales tax based 75 percent on point of sale and 25 percent on population. Under the changes, a new formula would be phased in over four years based 80 percent on population and 20 percent on point of sale.

Brown has said that the plan will benefit poor, rural counties whose residents travel to larger urban centers to shop.

However, it would hurt Dare County, which has a relatively small year-round population of 35,000 but whose population swells during the tourist season. Visitors spend money in the county, and a portion of the money is returned to the county — as the point of sale — in order to fund the additional services and infrastructure needed to accommodate tourists.

Woodard read a letter that he had drafted on behalf of the board to Sen. Phil Berger, Senate President Pro Tempore, in which he condemned the attempt to redistribute the sales tax revenue.

“Our Board is vehemently opposed to the proposals that are being discussed by the Legislature,” the letter says. “These misguided efforts have been incorrectly titled as ‘Tax Fairness Acts’ and ‘Simple and Fair’ plans, when in fact they are neither simple nor fair.”

The plan, he wrote, would have a “disastrous” and “debilitating” effect on Dare County by taking away $10 to $12 million from the general fund — more than 10 percent. This, Woodward writes, would cause a major reduction of essential services or a “walloping” ad valorem tax increase.

“Let there be no doubt, either of these would create a budgetary tsunami that would ripple throughout North Carolina’s Outer Banks ruining our families, small businesses, and
communities,” the letter reads.

Woodard notes that over the last 10 years, county officials calculate that Dare has contributed more than $80 million in sales tax revenue and has been able to do so because of tourism, which brings about 300,000 visitors in the summer months.

“It is these out-of-state visitors that generate the sales taxes collected by Dare County, which have been generously shared with other counties and municipalities,” the letter says.

“As one of America’s premier tourism destinations, Dare County has been able to attract millions of people to North Carolina each year,” the letter continues. “While North Carolina benefits from the dollars these visitors bring, it is Dare County that is left with the responsibility to fund water plants and provide law enforcement, fire protection, emergency medical services, and other visitor driven needs.”

The proposal would “unfairly punish counties” such as Dare that depend on tourism and threaten “core conservative values that are needed to promote and sustain a business-friendly, free market economy throughout North Carolina.”

The board unanimously passed a motion to send the letter to Berger.

However, this morning, the Senate passed its budget, which includes the sales tax redistribution plan.

“It’s not too late to stop this destructive plan for Dare County,” Woodard said this morning in a statement.

The Senate budget now moves to a conference committee and then must be approved by the House of Representatives. Woodard urged all who are concerned to contact state leaders to object to the sales tax redistribution plan. Dare County is represented by Sen. Bill Cook and Rep. Paul Tine. Contact information for every legislator can be found at www.ncleg.net.

In other action, the commissioners:

Approved a Tourism Board grant from the restricted fund to the Chicamacomico Historical Association for $65,412 for repairs to the doors, windows, and exterior trim of the historic Chicamacomico Life-Saving Station in Rodanthe. The non-profit board maintains the station as a historic site that, with its tours and programs, is a significant tourist attraction for the island and the county.

Authorized the submission of a project request for sidewalks in Hatteras village to the Albemarle Planning Organization. The request is for funding consideration in the state Transportation Improvement Plan and would not require any county funds. The sidewalks would connect the two bridges over Slash Creek in the village and would also address stormwater problems.

Adopted an abandoned vessel ordinance as the first step in addressing the issue of abandoned boats in the county’s waterways. The ordinance defines an abandoned vessel as one “that is moored, anchored, or otherwise located for more than 30 consecutive days in any 180 consecutive-day period without permission of the dock owner, marina owner, boat slip owner, or property owner whereby the vessel is located.” The ordinance prohibits the abandonment of a vessel and allows the county to remove and dispose of them.

Approved a resolution brought to them by Sandy Semans Ross of Stumpy Point that requests the North Carolina Marine Fisheries Commission adhere to the process of calling together scientists and stakeholders to study a Southern flounder management plan to ensure it is defensible plan and sets a realistic goal, as laid out in the North Carolina Fisheries Reform Act of 1997. The resolution also call for the federal government to remove restrictions on commercial fishermen that have shut down the fishery until at least Sept. 1 because of interactions with sea turtles until such time that recreational interaction is also addressed. And it asks that proper stock assessments for Southern Founder and sea turtles be formulated and peer-reviewed before any additional efforts at restricting the fisheries are implemented.

During his chairman’s comments at the beginning of the meeting, Woodward updated the commissioners on letters he has written to state Attorney General Roy Cooper on Jan. 20, asking for an investigation into gas prices in the county. The chairman first wrote a letter on Jan. 20 and followed up with a second letter in March.

“The prices that are being forced on our residents and visitors far exceed the prices elsewhere in our region and the average rate in North Carolina,” Woodard wrote in the letter.

“I am sure you agree that our unfair gasoline prices are not the type of welcome message we want to extend to those who are bringing their tourism dollars to North Carolina,” Woodard wrote.

On June 12, Phillip Woods, special deputy attorney general, e-mailed the commissioners that, while he was limited in what he could disclose, the attorney general office has sent letters to “three major retailers in Dare County seeking information regarding costs and retail selling prices of gasoline.”

The letters, he said, were sent on May 19, and there had been no response by June 12. The retailers have 30 days to respond.