Wed July 23, 2014
Sales Tax Cap Passes Key Senate Vote
After a contentious debate on the Senate floor earlier today, a bill capping county sales tax passed 33 to 16. Joining Mark Rumsey to talk about the bill and the implications for Mecklenburg County is WFAE’s Tom Bullock.
Mark Rumsey: First, tell us what this bill would do.
Tom Bullock: The bill would limit the sales tax rate for all counties at 2.5 percent. And it would allow counties not yet at that cap to use the added revenue for a combination of education, transportation or general use spending. And it's seen as giving more flexibility to rural counties since it would make it easier for those counties to raise their sales tax rate. But it’s a different story for urban counties like Mecklenburg which already has a sales tax rate of 2.5 percent.
MR: Mecklenburg County Commissioners have approved a November referendum to add a quarter percent to the sales tax rate. How does it affect those plans?
TB: It would effectively kill that vote, which has Commissioners here scrambling. The plan is to use the added revenue to boost teacher pay locally, boost library funding and help shore up the arts and science centers in the area that are running serious deficits. Right now county and civic leaders have no Plan B.
MR: So what’s next for the sales tax bill?
TB: Today’s vote was a so-called "second reading." The full senate will vote on it again – likely tomorrow. But this was the key vote. It was the first time it was up before Senate and there seems to be little reason to believe enough votes would flip to change the outcome. Then it goes to the House for consideration. What’s interesting there is a number of representatives have said they learned of this bill through the media – so we don’t yet know the chances of the bill there.