Desperate for more money, North Carolina counties repeatedly ask taxpayers to approve higher sales taxes.
Most of the time, these ballot measures fail. But eventually, inevitably, they pass.
This week, 7 more counties approved quarter-cent sales tax increases that can be spent on anything the elected county commissioners decide. Most of the time, the boards make promises on what they’ll spend the money on1.
Now a total of 30 counties have the higher sales taxes approved. With the persistence county commissioners have shown, I’d guess they’ll be statewide in another decade.
What’s the trick to getting voters to approve a sales tax increase?
Counties that get these taxes approved tend to pledge to dedicate them to public school needs, usually maintenance. This works even if the sales tax revenue only puts a small dent in the school district’s overall needs.
Counties that fail to sway voters are more likely to say they’ll use the money for other things, or keep it vague. Two counties that failed this year were going to use the money to plug holes in unsustainable budgets that are rapidly spending down their savings accounts.
But in nearly every case, voters had rejected the tax increase at some point in the past decade. Sometimes it was just two years ago.
Where’d these tax increases come from?
The sales tax referenda are a function of a 2007 law that allowed them. Since then, nearly every county in North Carolina has tried to get them approved.
The law does not put any restrictions on how often counties can put these measures on the ballot. One county even put it to voters twice in one year.
This sales tax is different from another 2007 law that lets counties pass a half-cent sales tax increase for transportation.
So far, only Mecklenburg, Wake, Durham and Orange counties have that sales tax.
All of that is on top of the standard sales taxes. The state rate is 4.75%. Most counties add on another 2 percent. The highest rate currently is 7.5%.
The 7 counties that approved sales tax increases this year:
Clay (69% for, 31% against): Commissioners put this on the ballot again after it got voted down in 2016. They made no promises on where it would go, but two years ago hinted it could help shore up their fund balance that was being spent down. The tax increase should raise $250,000 per year.
Gaston (52% for, 48% against): This narrowly passed in conjunction with a $250 million school bond. Commissioners said the sales tax increase would pay for the bond.
Jones (53% for, 47% against): Commissioners say the money will be used to buy new technology for schools. Voters had shot it down in 2016.
Lincoln (52% for, 48% against): Commissioners pledged that money would go toward schools.
Pasquotank (51% for, 49% against): This should likely generate $1 million per year for the county’s public schools.
Rockingham (55.5% for, 45.5% against): Rockingham Community College will get a $15 million workforce development center with the money, estimated at $1.8 million per year. This increase had been voted down three times previously.
Rutherford (72% for, 28% against): Commissioners said the $1.2 million per year will go to school maintenance.
The 5 counties that rejected sales tax increases:
Bertie (71% against, 29% for): This failed twice in 2014. I couldn’t find any information about what the money would have been used for.
Lenoir (53% against, 47% for): This county’s budget eats into its fund balance. The $1.3 million per year would stave off other cuts.
Person (60% against, 40% for): Interestingly, Person County would have used the money to fund volunteer fire departments.
Washington (63% against, 47% for): Before this was voted down two years ago, the county said the money would go to the 911 dispatch center.
Watauga (55% against, 45% for): Commissioners said it would pay for capital projects in public schools and build a new community center.