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ORANGE COUNTY <br />BOARD OF COMMISSIONERS <br />ACTION AGENDA ITEM ABSTRACT <br />Meeting Date: September 2, 2010 <br />Action Agenda <br />Item No. ~ - Gi <br />SUBJECT; Resolution Regarding Planned Uses of Revenues from a Potential One- <br />Quarter Cent (1/4¢) County Sales and Use Tax <br />DEPARTMENT: Manager & Financial Services PUBLIC HEARING: (Y/N) No <br />ATTACHMENT(S): <br />Attachment 1: Draft Resolution <br />Regarding Uses of <br />Potential Revenues from <br />a One-Quarter Cent <br />(1/4¢) County Sales and <br />Use Tax <br />INFORMATION CONTACT: <br />Frank Clifton, County Manager, <br />245-2300 <br />Clarence Grier, Financial Services, <br />(919) 245-2453 <br />Michael Talbert, Financial Services, <br />(919) 245-2153 <br />PURPOSE: To approve a resolution specifying the intentions of the Orange County Board of <br />Commissioners regarding the use of the proceeds from aOne-Quarter Cent (1/4¢) County <br />Sales and Use Tax, if approved by voters on November 2, 2010. <br />BACKGROUND: Local governments in North Carolina have historically relied heavily upon ad <br />valorem property taxes as their major source of revenue. For a number of years, the Orange <br />County Board of County Commissioners, the North Carolina Association of County <br />Commissioners and many other local governing boards across the state lobbied the North <br />Carolina General Assembly for legislative authority to expand counties' revenue options, <br />thereby lessening counties' reliance on property taxes. <br />During the 2007 legislative session, the North Carolina General Assembly granted county <br />boards of commissioners the authority to levy, subject to voter approval, an additional one- <br />quarter cent (1/4¢) county sales and use tax referred to as the Article 46 sales and use tax. As <br />authorized by the General Assembly, the Article 46 sales tax cannot apply to consumer food <br />purchases. There is also no legislative requirement, or mechanism, for counties to share the <br />additional one-quarter cent sales tax with municipalities. <br />A total of 17 out of 100 counties have approved the Article 46 one quarter cent (1/4¢) county <br />sales and use tax. At least 10 counties will a hold referendum on the quarter-cent sales tax this <br />year. <br />The Board held a public hearing on June 1, 2010 to solicit comments from the public on a <br />possible November 2, 2010 Special Advisory Referendum concerning the Levy of a One- <br />Quarter Cent (1/4¢) County Sales and Use Tax. The two speakers encouraged more <br />opportunities for public input and for the Board to consider additional funding for Human <br />