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1 <br />ORANGE COUNTY <br />BOARD OF COMMISSIONERS <br />ACTION AGENDA ITEM ABSTRACT <br />Meeting Date: April 19, 2011 <br />Action Agenda <br />Item No. ~{- - C~ <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: (YIN) 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 outlining 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 8, 2011. <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 />Between November 7, 2007 and December 31, 2010, 77 referendums on the quarter-cent sales <br />tax have been held in 53 counties. Of those 77, 18 were approved and 59 failed. This year one <br />referendum has been held to date and the quarter-cent sales tax was approved in Halifax <br />County on February 1, 2011. There are three referendums scheduled for the remainder of <br />2011 - Cabarrus County is scheduled for May 17, 2011 and both Buncombe County and <br />Orange County are scheduled for November 8, 2011. <br />