Agenda - 04-27-2017 - 1 - Consideration of the Final Draft Durham – Orange Light Rail Cost Sharing Agreement and Final Draft Orange County Transit Plan

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71 Orange County Transit Plan April 25, 2017 income and metro area housing completions as the main The forecast for GoTriangle's vehicle rental tax was developed explanatory variables for revenue growth. This analysis in October 2014 by Dr. Michael Walden, an economist at North provided year-by-year growth rates for 2017 through 2046, Carolina State University, using enplanements at RDU incorporating assumptions about economic cycles. The International Airport and annual real Gross Domestic Product compound annual growth rate (CAGR) over the 30-year period (GDP) as the main explanatory variable for revenue growth. was projected at 3.71 percent. This Plan assumes the year-by- This analysis provided year-by-year growth rates for years 2014 year growth rates for years 2017 through 2046 and the CAGR through 2024, with an average annual growth rate of 4.8 for years 2047 and beyond. The Moody's Analytics Sales Tax percent. This Plan assumes the year-by-year growth rates for Forecast document is included as Appendix D. years 2017 through 2024 and the average annual growth rate for years 2025 and beyond. The second dedicated revenue source is a vehicle rental tax, which is imposed at the rate of five percent on the gross The third dedicated revenue source is a three dollar($3)vehicle receipts derived by a retailer from the short-term rental of "U- registration fee, which is an increase to GoTriangle's five dollar drive-it" vehicles and motorcycles. ($5) vehicles registration fee. Since 1991, GoTriangle has been collecting a five dollar ($5) vehicle registration fee in Durham, GoTriangle has statutory authority to levy this tax in Durham, Orange and Wake Counties; those revenues fund GoTriangle's Orange, and Wake Counties, and has since November 1997. general operations. To fund the Durham and Orange Transit GoTriangle collects this tax directly from rental vehicle vendors Plans, GoTriangle exercised its statutory authority to increase in each of the three counties, including at Raleigh-Durham the five dollar fee by three dollars in Durham and Orange International Airport. GoTriangle's Board of Trustees has a Counties; it dedicated those incremental revenues to the policy that allocates 50 percent of these vehicle rental tax county transit plans. GoTriangle needed to create the Durham- revenues to the transit plans of Durham, Orange and Wake Orange Tax District (distinct from the Western Triangle Tax counties, with the remaining 50 percent reserved for District) and receive approvals from GoTriangle's Special Tax GoTriangle's general use. The amount identified for the county Board and both Boards of County Commissioners. GoTriangle transit plans is allocated based on 2010 population as follows: created the Durham-Orange Tax District, its Special Tax Board 68 percent to Wake County, 21.5 percent to Durham County, approved the fee in February 2014, and the Counties approved and 10.5 percent to Orange County.As such,the Orange County the fee in March 2014. GoTriangle began levying the fee shortly portion of all vehicle rental tax revenues is, compared to the thereafter. The revenues from the three dollar fee that are total collected, 5.25 percent. collected in Orange County are included in this Plan. Final Page 47 of 65