County Tax Increase Elections | Eastern North Carolina Now

   Publisher's note: Agenda 2012 is the John Locke Foundation's charge to make known their wise political agenda to voters, and most especially candidates, with our seventeenth instalment being the "County Tax Increase Elections," written by Dr. Michael Sanera, Director of Research and Local Government Studies at the John Locke Foundation. The first installment was the "Introduction" published here.

    In 2007, county commissioners asked the legislature to give them more taxing authority. Ever increasing demands for services, especially related to population and student growth, created pressure for additional revenue sources. The legislature responded by providing counties with the authority to increase the county sales tax by one-quarter cent or to increase the land-transfer tax by 0.4 percent, but only after an advisory vote of the people. At the time, this seemed like a reasonable solution to the budget pressures on county government. (The land-transfer tax option has since been repealed.)

    Unfortunately, legislators did not foresee how some county commissioners, desperate for more tax revenue, would game the system in order to get the "public" to vote for a tax increase.

    The first tactic used by some county commissioners was to place the tax increase on the November ballot in odd numbered years when only municipal offices were on the ballot. This caused the county taxpayers to incur the expense of opening rural polling places for the tax increase vote. This strategy was used on Buncombe County and even the Asheville Citizen-Times noted the cynical nature of the decision by reporting that the more liberal city voters would turn out in higher numbers because they were voting on city council candidates than the more conservative rural voters who had no other issues or candidates on the ballot.

    Asheville-Buncombe Technical Community College, the promised beneficiary of the estimated $7 million per year from the quarter-cent sales tax increase, offered to chip in the nearly $80,000 needed to open the rural polling places. Some might call it unethical for a special interest group to subsidize an election that will likely lead to a monetary gain for that special interest group.

    The second tactic used by some county commissioners to secure a tax increase was to call for a special election outside the regularly scheduled May primary or November general elections with the tax vote the only measure on the ballot. For example, county voters were asked to vote in single-issue, tax increase elections on February 1, 2011, August 31, 2010, and January 8, 2008. (See table below)

    Since 2007, 11 counties have used this tactic with a 64 percent pass rate compared to only a 13 percent pass rate when the votes were held on either the May primary or the November general election dates.

    One of the reasons for the huge difference in approval rates is that holding single-issue elections outside the usual May and November dates tends to suppress voter turnout. (See table below) For example, the Halifax County turnout on February 1st was 6.5 percent, Robeson County turnout on August 3rd was 4.2 percent and Randolph County turnout on March 2nd was 4.9 percent. Also note that three of the four tax increase defeats had the highest voter turnout with the defeat in Clay County on Aug. 29, achieving a 30.3 percent voter turnout.

    The reason this gimmick works is that the county special interest groups, such as school district and county employees who would benefit from the tax increase, are more likely to turn out and vote than general taxpayers who would be paying the bills. This ploy is hardly democracy in action and commissioners should be ashamed at resorting to this trick to win "voter" approval.

Recommendations

    Amend the local option sales tax statute to require counties to hold advisory elections on the November general election date in even-numbered years.


    Analyst: Dr. Michael Sanera

     Director of Research and Local Government Studies
     (919) 828-3876 • msanera@johnlocke.org