Agenda - 05-26-1992 - Laserfiche WebLink

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one -half cent sales tax was adopted based on the provisions of ' Article 41 of G.S. 105. Under the statute and the approved local option, 60 percent of the proceeds could be used to finance public school capital projects and /or retire debt. , As shown in Table 10, Orange County expects to receive an average annual payment of $2,648,447 in Article 40 sales tax revenues from FY 1992 -93 to FY 1997 -98, the capital improvement ' program period. In addition, an average annual payment of $2,679,682 in Article 41 revenues is anticipated. Of these amounts, $2,118,758 are Article 40 revenues, and $10607,809 are Article 41 ' revenues. Combined, the average annual amount of sales tax revenues which can be used for public school capital needs is $3,726,567. Although Orange County does use a portion of these funds for debt r service payments and the remainder for capital needs, such distinctions are not considered in calculating the "credit" to be given for sales tax payments. , According to the 1990 Census, Orange County's population was 93,851. This represents a 21.8 percent increase from the 1980 population of.,77,055 or an annual growth rate of 2.18 percent. By ' applying this growth rate to the 1990 population, projections of the number of persons residing in the county during the FY 1992 -93 to FY 1997 -98 period can be made [see Table 10]. For the six -year ' period, the average annual population is 103,486. If the average annual sales tax revenue for public school capital needs [$3,726,567] is divided by this figure [103,486], the estimate of__ per capita sales tax revenue is $36. To calculate the present value of the per capita revenues, ' assumptions regarding the interest rate and term must be made. The current seven percent interest rate on bonds is used, since almost half of the sales tax revenues are used,to pay debt service on school capital needs. A six -year term is used, matching the capital ' improvement planning period and the time frame within which new school facilities are needed. The present value table in Table 12 indicates that the multiplier would be 4.76654. This means that the present value of the $36 annual per capita sales tax payment for r six years would be $172 [$36 x'4.76654]. The per capita figure of $172 is of little use by itself. It ' must be converted to a per household figure, permitting it to be deducted from the total capital cost per student for school capital needs. Using 1990 Census information from the N.C. State Data ' Center, it is possible to calculate the average number of persons per household,-by housing type. This information is shown in Table 15. By multiplying the per capita figure of $172 by the number of , persons per household, it is possible to identify the amount of credit to be given to each new housing unit for payment of sales taxes. As an example, the average number of persons per household in , a single- family dwelling is 2.65. Multiplied by the per capita figure of $172, a single -- family household would be expected to ' contribute $455 in sales tax revenues toward the construction of Page - 12 1