Local Politics

Transfer Tax Idea Not Going Away After Defeat

Posted November 7, 2007

— A day after voters in 16 North Carolina counties soundly defeated a controversial tax on home sales, state and local officials said Wednesday they would continue pursuing the tax to help pay for growth-related needs.

The land transfer tax was one of two local-option taxes that the General Assembly approved this year to help counties pay for infrastructure like new schools, improved roads and extended water and sewer lines. The tax amounts to 0.4 percent of a property's sales price, or $4 for every $1,000 in value.

The tax was put on the ballot in 16 counties this fall, and voters rejected the proposal by large margins in all of them. Unofficial results from five area counties considering a transfer tax – Chatham, Harnett, Hoke, Johnston and Moore – show between 70 and 93 percent of voters casting ballots against the tax.

"Upwards of 77 percent of the public (in the 16 counties) was opposed to this," said Tim Kent, executive vice president of the North Carolina Association of Realtors, which waged an unsuccessful battle in the General Assembly to keep the transfer tax from becoming an option for counties.

"People have sent a message that they absolutely, positively do not want to have a targeted tax on home ownership," Kent said.

House Minority Leader Paul Stam, a Wake County Republican, issued a statement Wednesday calling on lawmakers "to immediately repeal this misbegotten provision," saying it never should have been included in the state budget.

Chatham County officials have already said they plan to continue putting the tax up for votes, saying they need another option besides raising property taxes to pay for growth needs, including building six to eight schools in the next decade. Of the five area counties that voted Tuesday on a transfer tax, Chatham saw the strongest support, at 30 percent of voters.

"The needs that we have have not gone away from (Tuesday) to (Wednesday). In fact, those needs will increase over time," Chatham County Manager Charlie Horne said. "The Board of Commissioners, whoever is sitting, will have to struggle with how to finance with limited resources the needs that are apparent."

Officials in Wake and Durham counties also have floated the idea of putting a transfer tax on local ballots next year.

Todd McGee, communications director for the North Carolina Association of County Commissioners, said growth costs aren't going away soon, and counties will need to find some way of raising the money to pay for growth.

Forty-eight of North Carolina's 100 counties raised property taxes this year, McGee said, adding that counties cannot keep tapping that well every year to meet financial needs, especially as growth makes the needs more acute.

"We have got 3 million people coming our way over the next 20-some years. We have got to get ready for them, and that means more schools, more roads, more classes, more teachers," he said. "(Counties) need to be able to get ahead of this curve instead of constantly staying abreast with it or even falling behind."

Representatives of the home-building industry, which also lobbied against the transfer tax, said they create enough revenue to pay for infrastructure, but county officials aren't spending the money properly.

"There is plenty of money being generated. It is just a question of where it is being spent and prioritized," said Alastair MacAulay, director of political affairs for the North Carolina Homebuilders Association.

MacAulay suggested counties find cheaper ways to build schools and cut administrative expenses. He also said a sales tax would be a more palatable way to pay for growth.

Voters in five counties across the state, including Sampson County, on Tuesday approved a 0.25 percent local sales tax, the other optional tax that state lawmakers approved. Cumberland County voters defeated a sales tax proposal by a 52-48 percent margin.

McGee said counties will learn how to sell a transfer tax to local voters.

"Essentially what you're doing is asking citizens to tax themselves, and they're not going to do that unless you give them a good reason," McGee said. "It takes a while to build up a case like that."

But Kent, casting transfer tax opponents as "good guys," said the same groups would continue to fight the proposals at the polls.

"The good guys are going to continue to be involved in this issue and do battle as necessary," he said.


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  • romex Nov 9, 2007

    do something about the illegal immigrants and we wont have a problem ...............

  • retired and luv it Nov 8, 2007

    Sounds like a strong arm threat to me. After all these people don t work for the taxpayers and in their powerful positions they must keep the poor taxpayer "idiots" in line. Never mind looking at the hemmoraging waste of every dime they get their hands on.

  • tbajr Nov 8, 2007

    Chatham manager Horne and the commissioners has always used schools and growth, to force this issue, but have said nothing about the new law enforcement bldg being planned, how is that to be funded? Instead of upsizing the commissioners need to look at downsizing government and readdress our republican principles.

  • Scarecrow Cow Nov 8, 2007

    The people have spoken, so they need to back off!
    And jkuwalik2 I will be sure to check out that site.

  • jkuwalik2 Nov 7, 2007

    Everyone sems to hate the illegals being here. Tme to put your words into action. Here is a link that you can report companies that hire illegals and "shame" them into changing their hiring practices. It also has a way to make sure you are dealing with companies that don't hire any of them. I have reported several companies already.


    Do your part to clean up and clean out the work place in OUR country

  • RAPTOR Nov 7, 2007

    We all have to stick to our guns on this one.Even if it comes up every other year.

  • Highway Man Nov 7, 2007

    McGee says the local officials need to sell the idea of the tax to the voters. I say its time to vote out people like McGee from his position as county commissioner. The people have indeed spoken and with a strong voice.

  • msncdso Nov 7, 2007

    Those millions of people coming within the next twenty years, tell them to stay where they are.

  • PaulRevere Nov 7, 2007

    lgboro....you are correct! I would guess that 98.34% of illegals rent their home/apartment/casa/case grande, so it's the middle class...again...that gets shafted by taxes. All of these slow-growth, no-growth people are blaming the wrong group!

  • saturn5 Nov 7, 2007

    The voters have spoken. Any member of government who persists in pushing this unwanted tax should be voted out at the first opportunity. Our elected officials work for US, not the other way around. The voters apparently need to remind them of this.