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Wed, Jul 23 2008 

Published May 12, 2008 10:36 am -

Counties keep losing infrastructure votes


Associated Press

RALEIGH

Last year, the General Assembly and county commissioners statewide thought they had found a way to help local governments pay for the infrastructure needs of a growing North Carolina.

So far, voters aren’t buying in.

Proposals to raise a county sales tax by a quarter-cent or triple a county’s land-transfer tax were roundly defeated in last week’s primary election. Of the 24 counties where either proposal was on the ballot, only voters in Haywood and Cumberland counties approved the boosts. In five counties where voters rejected one tax last fall, they did so again on Tuesday.

In a contentious debate that delayed passage of the state budget for weeks last year, lawmakers agreed to let the state’s 100 counties seek the higher taxes. If approved, the new revenue is aimed at helping counties pay for infrastructure needs such as school construction and water and sewer improvements.

But only eight of the 55 separate votes on the tax increases have been successful. Opponents of the land-transfer tax are a perfect 20-for-20 in defeating the idea, including four times last week.

“Once more, the North Carolina taxpayers have made their feelings known,” said Tim Kent, executive vice president of the North Carolina Association of Realtors, which has spent hundreds of thousands of dollars to campaign against what the group calls the “N.C. Home Tax.”

The tax “would have been grossly unfair, singling out one group of people, those selling property, to pay for infrastructure, programs and services that benefit everyone,” Kent said.

David Young, president of the North Carolina Association of County Commissioners, said the Realtors have a large financial advantage in promoting their opposition. But he also acknowledged that county commissions haven’t been proactive enough to win over voters.

“We’ve got to do a better job of selling it to our citizens,” said Young, a Buncombe County commissioner. The few counties where voters approved the extra taxes did so because they made clear how the money would be spent.

In Haywood County, voters approved a sales tax option last week after commissioners said the $1.3 million generated annually would be used to renovate Haywood Community College. In November, Catawba County commissioners were successful with a sales tax because the money was earmarked for economic development and new courtroom space.

House Speaker Joe Hackney said lawmakers meant for it to be difficult for the counties to impose the new taxes, arguing that local leaders need to make the case for the increased levies.

“I expected a high failure rate,” said Hackney, D-Orange. “I think the system is working about how we thought it would.”

But Young cautions the infrastructure needs aren’t going away. He believes that if voters continue to reject the new taxes, county commissioners will face pressure to raise local property taxes, an option that doesn’t require a referendum, or again look to the Legislature for more money.

Critics of the taxes disagree. John Hood, president of the conservative John Locke Foundation, said county fiscal data shows that better use of existing money is enough to pay for counties infrastructure needs.

“Following reasonable standards, these counties can pay for their fundamental needs without the new revenue streams,” Hood said.



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