Rumors swirled this week that a revised sales tax redistribution plan would roll out in the Senate, possibly as part of the chamber's budget or part of a bill that has already passed the House, but as the week came to a close no such plan had yet been made public. Indications were the plan could be unveiled next week, possibly in a Senate Commerce Committee meeting scheduled for 11 a.m. Tuesday. Sales tax redistribution may be packaged with other finance elements of the Senate budget, which was originally scheduled to be passed by next Thursday. However, Sen. Harry Brown, one of the Senate's chief budget writers, told reporters yesterday that the Senate budget could be delayed into the weekend or the week beyond.
There has obviously been a great deal of behind the scenes discussion on the issue of sales tax redistribution. We have heard talk of a variety of different plans, including those previously released in Senate bills 369 and 608, and of a "compromise" plan in which 80 percent of sales tax revenues are distributed on a per capita basis and 20 percent are distributed on a point of sale basis. Legislators have also discussed with the League a variety of city revenue options that could be added to the bill. However, there has been no legislative language associated with any of these compromises or revenue options released, and every plan that has been made public repeals the local sales tax as a locally levied revenue and makes local sales tax revenues a state revenue that is shared with local governments. The League will not be able to support a bill that repeals the sales tax as a locally levied revenue source. If such a repeal were to occur, any projections of future gains or losses would be uncertain as total sales tax revenues available to local governments could be reduced by the state at any time.
Please continue to reach out to your Senators, and your Representatives, regarding sales tax redistribution. Outreach by city officials has made a difference already, and we are now likely days away from this plan being discussed at the legislature. As you discuss this issue with your legislators, please let us know what you are hearing, and we will do the same. Thank you for your work on this crucial issue for all of North Carolina's cities and towns. Contact: Chris Nida
Please take action this weekend by contacting your state representatives in favor of League-supported modifications to SB 25 Zoning/Design & Aesthetic Controls, which House leaders scheduled for a key committee vote Monday afternoon. Without any amendments in the House, the bill would head to the Governor for his signature, possibly as soon as Monday evening. League members prioritized a compromise on this issue as a Municipal Advocacy Goal this session. When discussing this bill with House members:
Amendments may be considered by the House Committee on Regulatory Reform at its meeting Monday afternoon, or on the House floor. If you would like to provide the specific amendment language to your legislator, or if you would like more background on what the League's compromise language does, please contact Erin Wynia.