Press Release

Charlotte regains top spot on annual N.C. tax-and-fee burden list

posted on

RALEIGH — After a one-year dip, Charlotte regains the top spot on the John Locke Foundation’s annual list of larger N.C. cities with the highest local government costs per person. Mooresville, which had ended Charlotte’s 11-year run at No. 1 last year, drops to No. 2 in the latest list.

Charlotte’s local taxes and fees totaled $2,379 per resident in the 2012 budget year, while Mooresville’s tax-and-fee burden topped $2,336 per person.

Chapel Hill drops one spot to No. 3, Wilmington remains at No. 4, and Monroe ($2,175 per person) climbs one spot to No. 5 in the rankings of combined city and county costs per person.

The list compared 35 ranked municipalities with at least 25,000 residents. Jacksonville, Thomasville, Indian Trail (No. 33 at $1,273 per person), Fayetteville, and Asheboro ranked lowest among the larger cities.

Among other area cities, Cornelius ($2,000) jumped five spots to No. 8. Matthews ($1,932) ranked No. 12, Salisbury ($1,928) No. 13, Huntersville ($1,927) No. 14, Concord ($1,836) No. 20, Kannapolis ($1,662) No. 23, and Gastonia ($1,656) No. 25.

Among 88 ranked medium-sized municipalities, three Charlotte-area communities ended up among the top 25 percent in local government costs: Pineville ($2,692), Davidson ($2,156), and Statesville ($1,798). Those with tax and fee burdens closer to the median were Belmont ($1,734), Mint Hill ($1,719), Newton ($1,715), Lincolnton ($1,695), Waxhaw ($1,692), Albemarle ($1,688), Conover ($1,686), Harrisburg ($1,557), Cherryville ($1,429), Mount Holly ($1,422), Bessemer City ($1,421), and Stallings ($1,371). Wadesboro ($1,277), Marvin ($1,175), Wesley Chapel ($1,088), and Unionville ($1,075) had costs among the bottom 25 percent of municipalities with 5,000 to 24,999 residents. Weddington was unranked for 2012 because of incomplete data.

Mecklenburg County (5.44 percent) jumped five spots to No. 5 in the state with its rate of taxes and fees as a share of income. Cabarrus (4.86 percent) ranked No. 14, Anson (4.78 percent) No. 17, and Gaston (4.56 percent) No. 20. Most of the rest of the area’s counties had rates closer to the state median. Rowan (4.50 percent), Iredell (4.40 percent), and Union (4.04 percent) counties all had rates higher than the median of 3.94 percent. Stanly (3.93 percent), Lincoln (3.56 percent), and Catawba (3.32 percent) fell below the median county.

By The Numbers: What Government Costs in North Carolina Cities and Counties FY 2012 is the 16th such report published by the John Locke Foundation. Lowrey used the most recent data available from the State Treasurer, Bureau of Labor Statistics, and Bureau of Economic Analysis to construct rankings of local government cost on a per-person basis. For counties, he also constructed rankings on a share-of-income basis.

Lowrey highlights a continuing problem that helps skew the rankings. Hyde and Sampson counties and 44 municipalities missed state deadlines to file their State Treasurer’s Annual Financial Information Report.

“Whether those local governments filed the statements after the deadline or not, the information was not available from the treasurer’s office in time to be included in this report,” Lowrey explained. “Without those AFIR statements, By The Numbers cannot include local tax burdens for those communities. Complete reporting would result in a somewhat higher combined county-municipal median tax burden.”

Lowrey also repeated his annual warning against comparing the relatively high per-capita tax numbers in resort communities to those in other N.C. cities. Communities with larger numbers of second homes and resorts — combined with small year-round populations — will see larger per-capita tax burden figures, he said.

The latest report contains another warning. “The state treasurer’s office drastically reformulated how local government financial information is reported with data for the 2012 budget year,” Lowrey said. “It is thus possible that comparisons between this edition of By The Numbers and previous reports might be more difficult.”

Among the 10 most populous counties, Durham (5.66 percent), Mecklenburg (5.44 percent), Guilford (5.02 percent), New Hanover (4.84 percent), Forsyth (4.56 percent), Gaston (4.56 percent), Buncombe (4.52 percent), and Wake (4.44 percent) all ranked among the top 25 N.C. counties in average cost of local government. Union (4.04 percent) ranked near the middle of the pack. Cumberland (3.11 percent) ranked No. 83 of the 98 ranked counties.

North Carolina collected $21.9 billion in state tax and fee revenues from July 1, 2011, to June 30, 2012. That’s 6 percent of state residents’ personal income. Local governments collected an additional $15.7 billion in property, sales, and other taxes and fees. That’s another 4.3 percent of personal income.

“Combined, they represent a state and local tax and fee burden of 10.3 percent,” Lowrey said. “Federal collections raise the total tax burden on North Carolinians to approximately 26.8 percent of personal income, on average.”

Lowrey stresses that a high cost-of-government ranking in the By The Numbers report does not equal a judgment that a city or county is governed poorly.

By The Numbers is a tool that represents factual data only, without editorial comment or bias,” Lowrey said. “The best way to compare your city or county to others is to find municipalities or counties of similar size and demographics.”

“This report helps taxpayers evaluate whether the services they receive from local government merit what they are paying for them,” he added. “We hope taxpayers will continue to ask about the proper role of local government and its relationship to the state. It’s important to keep these discussions alive and to ensure our local leaders remain accountable to taxpayers.”

The John Locke Foundation Policy Report, “By The Numbers: What Government Costs in North Carolina Cities and Counties FY 2012,” is available at the JLF website. For more information, please contact Michael Lowrey at (704) 569-4269 or [email protected]. To arrange an interview, contact Mitch Kokai at (919) 306-8736 or [email protected].

Donate Today

About John Locke Foundation

We are North Carolina’s Most Trusted and Influential Source of Common Sense. The John Locke Foundation was created in 1990 as an independent, nonprofit think tank that would work “for truth, for freedom, and for the future of North Carolina.” The Foundation is named for John Locke (1632-1704), an English philosopher whose writings inspired Thomas Jefferson and the other Founders.

The John Locke Foundation is a 501(c)(3) research institute and is funded solely from voluntary contributions from individuals, corporations, and charitable foundations.