The combined state tax and county sales tax in New Hanover is 7% — with county tax at 2%. The proposed increase would raise that to 7.25%. The county estimates the increase would produce an additional $144 million dollars over the next decade, assuming about 3% annual growth in the region.
The goal of the sales tax is to fund transportation improvements, like bus services, connected bicycle and pedestrian paths, and rail realignment.
In a presentation given to the board, several exceptions were laid out, for example revenue from the quarter-cent sales tax cannot be used to replace current funding set aside by the county for public transportation. They also can not be used for building or maintaining roadways (counties have no authority under state law to build or maintain roads).
The proposal lays out how that money would be divided up, with roughly 40% going to bike and pedestrian paths in the city and county, 15% going to rail realignment, and 45% going to WAVE and Bus Rapid Transit.
Next steps
Monday’s vote is the first step in a lengthy process. The next step is a public hearing — the board must receive public input at a minimum of 30 days before the Commissioners instructs the North Carolina Board of Elections to actually put the tax increase referendum on the ballot. County staff recommend holding this hearing over the summer.
After that public hearing, commissioners could vote to scrap the process or move ahead with a referendum vote, with the sales tax appearing as a ballot question for the November 8 general election. It needs only a simple majority of votes to pass.
But, if the sales tax is approved by voters in November, the Board of Commissioners still must pass their own resolution to actually implement the tax. This vote could take place right after the election in November or December or in 2023. This means a new board might be voting if, for example, one or both of the two commissioners currently up for reelection don't win — that's Chair Julia Olson-Boseman and Rob Zapple.
Differing views
Olson-Boseman said she couldn’t support the tax, and cast the only dissenting vote, saying “I think the timing is bad. It’s just one vote. A lot of people and businesses are still struggling. We asked staff to bring us a budget amendment lowering property tax and now we’re asking to raise sales tax?”
Commissioner Rob Zapple made a case for the tax by calling on people outside of New Hanover County. Tourists that come to the area and spend money would be contributing to the revenue as well as the thousands of people that come across county lines from Brunswick and Pender counties on a daily basis, he said.
