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~~ <br />Page 6 <br />February 7, 2003 <br />activities being performed by the County, Orange County could <br />create solid waste service districts that are defined by the <br />level of solid waste service provided to the district. However, <br />before solid waste service districts can be effective in the <br />towns in Orange County, the towns would have to consent to their <br />being included. Service districts under Piorth Carolina law are <br />special tax districts only, They are not units of government <br />which can charge fees for services, The use of service district <br />taxes as an alternative financing method is discussed below. <br />County service districts for solid waste collection and <br />disposal systems can be created based on the service provided, <br />That is, each district would vary depending on whether the <br />property owner had access to the rural solid waste collection <br />system, rural curbside collection or town curbside collection, <br />As mentioned previously, before a county service district can <br />include land in a city or town, the city or town must agree to <br />its being included within the district. All aspects of the <br />property tax generally pertain to service district taxes. That <br />is, properties that are exempt from property taxes generally <br />will be exempt from service district taxes. And, property <br />valuation will be the same as for property taxes generally. <br />Therefore, for example, property in the use value program or <br />homestead exempt property would be taxed at its use value or net <br />of the homestead exemption. <br />County service district tax rates are considered together <br />with other County taxes for' tax rate limitations. They are in <br />the same category as 153A-149(c) functions that may be paid-for <br />with county taxes, which have a combined rate limit of $1.50 per <br />$100 of valuation, They would appear on the tax bill as a <br />separate line item and would be collectible in the same manner <br />as other property taxes. Service district tares are deductible <br />as are other property taxes for State and federal income tax <br />purposes. <br />A service district tax should be relatively easy to <br />administer because of the advanced GIS technology available to <br />Orange County to identify and map the districts. Although <br />service district taxes will not capture entities otherwise <br />exempt from property taxes, they will tax all othex persons <br />using the County's solid waste system. They are, in that regard, <br />a flow control technique which I think would avoid federal flow <br />