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3 <br /> Transfer Tax. He indicated that Chapel Hill is proposing that one percent <br /> of the sales price for land and buildings be paid by the seller at the time <br /> of the transfer. He stated the money would go to finance capital projects <br /> and in particular schools, street improvements, building of bridges and <br /> culverts, open space and parks and houses. <br /> He continued that based on 1986 sales, income from this tax would total <br /> $2 ,235, 000. If this money were to be allocated on the point of origin <br /> basis, Orange County would receive $1. 2 million or 54% and Chapel Hill <br /> would receive $973 , 000 or 44%. If allocated by population, Orange County <br /> would receive $1.4 million and Chapel Hill $587, 000. If it were allocated <br /> according to a combination of the two, Orange County would receive $1. 3 <br /> million and Chapel Hill $780, 000. <br /> He stated that it is their proposal that this be a county-wide tax. The <br /> County Commissioners and the County staff would administer the tax in the <br /> same way as the Ad Valorem tax. He proposed that the collection procedure <br /> be at the time of recordation of property transfer. On May 13 , the Chapel <br /> Hill Town Council will consider a resolution to support this local bill on <br /> a County basis and he urged the Commissioners to do likewise. There is no <br /> objection to the establishment of a figure below which there shall be no <br /> transfer tax. <br /> In conclusion Mayor Wallace stressed that this tax not be an added tax <br /> with the Ad valorem tax increasing also. <br /> JAMES PORTO , Mayor of Carrboro, stated that the Board of Aldermen has <br /> not made a decision on the Real Estate Transfer Tax because they did not <br /> have adequate information on which to base a decision. He stated that <br /> while the Carrboro Board would rather find an alternative way to raise <br /> revenues that they would like to be able to be included in further <br /> discussion. <br /> Chair Marshall noted that the legislative delegation would favor a bill <br /> that included a stipulation that a municipality would have to adopt the <br /> resolution in order to be included. This would give Carrboro the <br /> opportunity to hold a public hearing and approve a resolution before <br /> implementing the tax. <br /> Mayor Porto stated that if this tax is imposed on the citizens that <br /> live in Carrboro that Carrboro would like to receive a portion of the tax <br /> even if the Board did not support the tax. <br /> GRAINGER BARRETT , Vice-President of Governmental Affairs for the <br /> Chapel Hill-Carrboro Chamber of Commerce, stated that the Chamber of <br /> Commerce perceives this tax as a form of property tax. He stated that an <br /> alternative tax would be the hotel/motel tax or the entertainment tax. The <br /> Chamber feels the tax falls unevenly on those who pay and those who <br /> benefit. A major problem in Orange County is the price of property. A <br /> lower priced house will sell more times and when adding 1% to the price of <br /> that house each time, the price escalates. The lower income citizens will <br /> be driven out of the County into other counties. <br /> He noted that the way to pay for the capital needs in the County is not <br /> pay-as-you-go because it introduces an inequity between those who pay for a <br /> longlife facility today and those who enjoy it over a longer period of <br /> time. The way to finance for fiscal soundness and fiscal fairness is to <br /> issue bonds and let those who enjoy the facility pay for that enjoyment <br /> over the life of it. <br /> KAY LAYMAN , Executive Officer of the Durham-Chapel Hill Homebuilders <br /> Association, read a letter written by the President Nicholas J. Tennyson. <br /> The letter is an attachment to this minutes on pages . <br />