RALEIGH – Legislation currently under study in the North Carolina General Assembly could have a positive impact on the portion of state sales tax now received by all four counties in the Roanoke-Chowan area.
Currently, the lion’s share (75 percent) of state sales tax revenue is returned to the county where the sale took place. A month ago, Senate Majority Leader Harry Brown of Onslow County called for distributing 80 percent of revenues based on population and only 20 percent based on the sale location. His plan was not well received; to include Gov. Pat McCrory who threatened to veto the entire state budget if Brown’s plan was adopted.
The NC Senate is now studying a new proposal that would split revenues….one-half staying in the county where the sale occurred and the other half distributed based on county population. If approved by both the Senate and the House, the change would take effect in 2016.
Currently, Bertie County is projected to receive $1.83 million in state sales tax during fiscal year 2015-16 (which began July 1, 2015 and ends June 30, 2016). If the plan gains approval, Bertie gains 28 percent in tax revenue, increasing to $2.4 million in 2016-17; and $2.45 million; $2.5 million and $2.54 million in the ensuing three fiscal years.
Those increases also proportionally benefit each municipality in Bertie County, led by Windsor gaining in excess of $200,000 (from $580,490 in current projections to $801,350 by 2019-20.
With the local area’s smallest population, Gates County would see the largest increase in percentage of revenue gain should the plan become law. Gates is projected to receive $1.45 million in state sales tax under the current formula in 2015-16. One year later, that amount will increase by 38 percent, to a shade over $2 million. Successive years will see Gates County pocket $2.11 million, $2.17 million, and $2.23 million in sales tax if the plan gains favor.
Hertford County already leads the way in the R-C area when it comes to state sales tax revenue. That fact is based on the county having the most retail outlets in the region.
Currently, Hertford County is projected to receive $3.71 million in sales tax revenue during 2015-16. If the 50-50 split formula is approved, Hertford County will see less than a 7 percent increase….going to $4.14 million in 2016-17; $4.26 million in 2017-18; $4.37 million in 2018-19; and $4.5 million in 2019-20.
Ahoskie – blessed with the largest number of retailers in the Roanoke-Chowan – will slightly gain sales tax dollars: $1.07 million in the current year; to $1.19 million next year; up to $1.29 million by 2019-20.
Murfreesboro also gains: now at $363,874 in projected sales tax revenue for 2015-16; to $439,686 by 2019-20.
The proposed 50-50 split funding formula has the potential to increase Northampton County’s share of state sales tax by 29 percent. The county is currently projected to receive $1.84 million in sales tax. That will increase to $2.43 million by 2016-17 if the plan is approved. The county will also gain in successive years: $2.48 million by 2017-18; $2.53 million by 2018-19; and $2.59 million by 2019-20.
Northampton’s gain also boosts the cash flow at the municipal level. Conway is now projected to receive $136,450 in sales tax for 2015-16; that will increase to $178,352; $182,200; $186,148; and $190,188 in successive years. Rich Square (now at $157,459) will note an increase to $219,613 by 2019-20; Woodland (now $129,232) may gain to $179,931 by 2019-20; and Jackson (currently at $81,887) has the potential to increase that revenue to $113,977 by 2019-20.