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Brunswick County to keep current sales tax distribution method

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Bolivia, NC, (News Release) -– Brunswick County’s Board of Commissioners voted unanimously to leave the sales tax distribution method unchanged at Monday night’s regular board meeting.

Earlier that night, the Ad Hoc Local Option Sales Tax Committee had met with plans to give a recommendation to the Commissioners. But a motion to distribute sales tax revenue by a blended method, part per capita and part ad valorem, received three votes in favor and three votes against.

The sales tax revenue in the county is currently distributed by a per capita method, meaning each town and the county as a whole get a share based on its population. That method has been in place since 1989; before that, it was distributed by the ad valorem method, though minutes from that meeting do not contain much information as to why the switch was made.

In August, the board appointed an ad hoc committee to examine the issue, after former Bald Head Island Mayor Larry Lammert requested a review of the method. By N.C. State Statute, counties can distribute sales tax revenue by the per capita method or by an ad valorem method, which distributes the money based on the amount of property tax revenue generated.

Counties can also distribute the sales tax revenue by a hybrid method, choosing to distribute some based on the ad valorem method and some on the per capita method. Hybrid methods require individual approval by the General Assembly.

Several of the county’s beach towns would benefit under a change to an ad valorem method or a hybrid, as would the county itself. Many beach towns had argued that such a method would better reflect the sales tax revenue brought in from tourists, who do not count toward the municipalities’ population totals, or from Brunswick County residents who shop in different areas from where they live. But the majority of the county’s municipalities would lose money under such a switch, and many had pointed out that ad valorem distributions reflect the amount of property tax revenue collected instead of reflecting the number of tourists themselves or the amount of sales tax revenue they generate.

Addressing the Commissioners Monday night, Committee Chair and Ocean Isle Beach Mayor Debbie Smith thanked the Board for creating the committee, and for reviewing both sides of the issue. After her presentation, the Commissioners agreed that switching to an ad valorem method would create more problems than it would resolve, and voted to stay with the current per capita method.

“We wanted to take a reasonable look at this, and we appreciate the time that’s been put into it,” said Commissioners' chair Phil Norris. “Based on the overwhelming response from constituents and towns, and the amount of time this method has been in place, it seems prudent to leave it in place.”

Commissioners Pat Sykes and Marty Cooke echoed Norris, thanking the members of the committee for their work in examining the issue and the best way to resolve it for all residents in the county.

“We looked at the sales tax because we have a fast-growing county and the dynamics are always changing, the target is always moving,” Cooke added. “We have to continuously be looking at it and seeing if we are on track, doing what’s right for everybody. We may not change anything, but we need to look under the hood sometimes to see if the oil is low, see if we’re operating the way we should be. I feel sure we will have to work with municipalities to see how we continue to address this issue and other issues, to make sure we’re doing what we need to be doing to be mutually beneficial for all of Brunswick County.”

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