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Mazch 11, 1998 <br />Chapel Hill High School PTSA <br />Kim Fahs, President <br />Jim White, Cultural Enrichment Committee <br />1709 High School Road <br />Chapel Hill, NC 27516 <br />Commissioner Bill Crowther <br />372 St. Mary's Road <br />Hillsborough, NC 27278 <br />Deaz Commissioner Crowther: <br />On January 1, 1998 legislation went into effect requiring North Carolina income tax, in the <br />amount of four percent, to be withheld from non-wage compensation paid to out-of -state <br />contractors for services performed in North Cazolina. The requirement is specifically <br />designed "for services in connection with a performance, an entertainment or athletic event, <br />the creation of a film or TV program or the construction or repair of a building or highway." <br />The requirement applies to payers who pay more than $600.00 in the course of a year to an <br />out-of -state individual or entity. <br />This ruling places public schools in a very difficult position. In many instances, schools aze <br />ill prepared to handle the withholding tax beyond their internal requirements. Additionally, <br />out-of--state entities are now reluctant to contract with our schools. Our goal is to provide <br />the finest possible educational experience for our students and we feel the burden of this <br />legislation on our school administration and the negative impact of the ruling on out-of--state <br />entities unduly effects our students. We humbly request your assistance in considering an <br />exemption for our schools or, at the very least, increasing the ceiling for the enactment of <br />this withholding tax to $1500.00 in the course of a year instead of the current $600.00 <br />amount. <br />Thank you for your consideration in this matter. <br />S(i/ncerely, <br />Kim Fahs, President <br />CHHS PTSA <br />Ji White, Chair <br />HHS CEC <br />11 <br />