House votes down Senate sales tax redistribution; local officials optimistic but not satisfied

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Mayor Bill Saffor, County Commissioner Chairman Jonathan Barfield Jr., and County Commissioner Beth Dawson during an economic update meeting earlier this year.
Mayor Bill Saffo, County Commission Chairman Jonathan Barfield Jr., and County Commissioner Beth Dawson during an economic update meeting earlier this year. Photo Courtesy of New Hanover County.

The North Carolina House of Representatives overwhelmingly voted against supporting a bill that included sales tax redistribution which, according to local officials, would take $22.4 million in Wilmington sales tax revenue along with $24 million from New Hanover County from 2017 to 2020 and redistribute it to rural counties throughout the state. The vote on HB 117 on Wednesday failed 111-2.

“This is great news for New Hanover County and Brunswick County and the taxpayers here,” said New Hanover County Commissioner Jonathan Barfield. “It’s encouraging that we’re getting support from the House along with our Governor Pat McCrory to oppose this legislation—and it gives us great confidence knowing that we’ll be able to protect our tax payers here in our county. However, we still have work to do and two of our commissioners are still in Raleigh talking with our representatives.”

According to Tony McEwan, Director of Governmental Affairs for the City of Wilmington, since the bill passed in the Senate but was not concurred in the House, the Speaker of the House Tim Moore will now form a conference committee of members of both chambers to reach a compromise on the bill.

“It’s a good victory but not the end of the road on this by any means,” said McEwan. “There are all these other avenues for this [sales tax redistribution] to be attached to, including the ongoing budget negotiations.” The North Carolina General Assembly is still debating a working budget, with negotiations between the House and the Senate continuing until the end of the month.

According to Wilmington Mayor Bill Saffo, if sales tax redistribution were written into state law, it could force local officials to cut some public services and raise property taxes another 5 percent and is “one of the worst public policies I’ve ever seen.”

“When you have that kind of loss in revenue and where our city’s budget — almost 50 percent — is public safety including fire and police, we’re either going to have to raise revenue by raising taxes or cutting services. There is no magic formula here,” Saffo said.

Related Story: Mayor Saffo, county officials speak out against sharing local sales tax

James Mieczkowski is a news reporter for Port City Daily. He can be reached at james.m@portcitydaily.com On Twitter: @mieczkowskiPCD