Minutes 04-23-2013 - Laserfiche WebLink

Browse Search

A motion was made by Commissioner McKee seconded by Commissioner Price to approve a resolution authorizing the scheduling of a public hearing for the installment financing for capital investment projects and equipment previously authorized by the Board. VOTE: UNANIMOUS C. d. Sales Tax Distribution Method for Fiscal Year 2013/2014 Frank Clifton said a decision needs to be made each year by the end of April. He reviewed the following two options and information, from the abstract: The first option is to distribute the sales tax collected based on population. The formula takes the County's population and adds all individual municipal populations. The percent of each individual municipalities population divided by that grand total is used to allocate the sales tax revenue. This method has been used by Orange County for at least the last 21 years. The second option is to distribute the sales tax collected based on the Ad Valorem Property Tax Levied by each taxing unit of local government. Attachment 1 lists the 2012-2013 Property Tax Levies by taxing unit of local government furnished by the North Carolina Department of Revenue. Orange County is the taxing unit of local government for not only Orange County, but for all special tax districts located in Orange County. The NC General Statutes give the Board of County Commissioners the option of changing distribution methods each year as outlined in General Statutes 105-472.b. below: "The board of county commissioners in each taxing county shall, by resolution adopted during the month of April of each year, determine which of the two foregoing methods of distribution shall be in effect in the county during the next succeeding fiscal year. In order for the resolution to be effective, a certified copy of it must be delivered to the Secretary in Raleigh within 15 calendar days after its adoption. If the board fails to adopt a resolution choosing a method of distribution not then in effect in the county, or if a certified copy of the resolution is not timely delivered to the Secretary, the method of distribution then in effect in the county shall continue in effect for the following fiscal year. The method of distribution in effect on the first of July of each fiscal year shall apply to every distribution made during that fiscal year." Frank Clifton said the current process has not been changed in years by the county. He noted that Orange County is unique in that it has a school district with taxing authority. This means that a switch to assessment base, then the Chapel Hill Carrboro City School district and the fire districts would receive an appropriation. He said this is brought to the board each year at this time and it is the Board's discretion to change it or leave it as is. Clarence Grier said if the process is changed to the ad valorem, $1,053,217 in sales tax credit would be gained. He said that Chapel Hill Carrboro City Schools would gain about $2.5 million; and Chapel Hill downtown service district and Durham would receive $500,000 in increases. He noted that the individual towns would lose about $4m in sales tax revenue based on the ad valorem property tax values. He said a cost sharing arrangement is possible and this would be based on the population and the distribution of this is outlined on page 3 of the abstract. He said that the manager recommends that the Board consider both options of the distribution and provide directions to the staff for distribution options for 2013-14. Commissioner Rich said this is nerve wracking for Chapel Hill Town Council, not knowing what Orange County will do until April. She has requested that this discussion be done earlier. She said this would be difficult for a town which is in the midst of budget and she