Press Release

Rejected Cherokee commissioners seek $600,000 tax hike before saying goodbye

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RALEIGH — Three Cherokee County commissioners who lost primary elections hope to leave the county with a $600,000 sales-tax hike as a parting gift. John Locke Foundation researchers question the need for that tax increase in a new Regional Brief.

Voters will decide Nov. 2 whether county commissioners can raise the local sales tax rate by 0.25 cents. The $600,000 in expected revenue is equivalent to a 1.5-cent property tax increase.

As voters cast their ballots, JLF experts urge them to consider why commissioners who were rejected at the polls have placed a tax hike on the ballot. Voters also should judge Cherokee County government’s record of fiscal responsibility and the funding of local public schools.

“It should raise red flags for voters that three county commissioners who lost primary elections in May have decided since their election losses to pursue both the sales-tax referendum and nearly $10 million for a courthouse addition, renovations, and property acquisition,” said Dr. Michael Sanera, JLF Director of Research and Local Government Studies.

“Whomever voters choose as their new county commissioners Nov. 2 should have the opportunity to demonstrate their fiscal responsibility without an additional $600,000 in taxes on Cherokee County residents and businesses,” he added.

Sanera analyzes the departing commissioners’ actions with the help of report co-authors Joseph Coletti, JLF Director of Health and Fiscal Policy Studies, and Dr. Terry Stoops, Director of Education Studies.

“The county manager claims the new courthouse-related spending ‘won’t necessitate a tax increase,'” Sanera said. “County commissioner Dana Jones agrees that the courthouse construction does not depend on a tax increase. Jones and the county finance officer claim that paying off past school facilities bonds will free up money for the courthouse.”

Whether that’s true, a plan to divert sales taxes designated for school facilities to a courthouse should send a signal to voters, Sanera said. “It’s a strong indication that any promises from commissioners cannot be trusted — especially from commissioners who have nothing left to lose politically.”

Voters should be concerned about other local spending decisions, Sanera said. “The latest round of robust spending seems to follow other questionable decisions when commissioners failed to show fiscal restraint and responsibility,” he said. “Salaries for sheriff and jail employees more than doubled between the 2004 and 2009 budget years. The county has expanded staff and spending with a new transit system, more parks and recreation staff, and other noncore government functions.”

The departing commissioners offered no clear reasons why voters should support a higher sales-tax rate, Sanera said. “Quoting meeting minutes, these outgoing commissioners approved the tax as ‘another way for the county to generate revenue, while also letting persons passing through contribute,'” he said. “They offered no plan to justify the higher tax, nor did they claim a pressing need for the tax collections.”

“If existing revenues should cover all of this new spending, why are commissioners seeking a $600,000 tax increase?” he asked.

It would be hard for Cherokee County to point to local schools to justify a tax hike, Sanera said. “Funding of schools is increasing at the same time that the number of students in county schools is declining,” he said. “During the 2008-09 school year, public school expenditures in Cherokee topped $9,800 per student and continued to exceed state averages.”

Existing federal and lottery funds are helping Cherokee County fund classroom teachers, and the county schools can expect more than $450,000 from North Carolina’s new Race to the Top education grant.

Since the General Assembly decided in 2007 to give each North Carolina county the chance to seek voter approval for higher sales or land-transfer taxes, voters have rejected higher taxes 68 times in 85 tries.

“Citizens at all levels — federal, state, and local — are frustrated with excessive and wasteful government spending,” Sanera said. “They believe they are not getting value for their tax dollars. County spending is no different. Cherokee County voters have a chance to send commissioners a clear message Nov. 2.”

Michael Sanera, Terry Stoops, and Joseph Coletti’s Regional Brief, “A Taxing Legacy in Cherokee: County voters face vote on higher taxes proposed by rejected commissioners,” is available at the JLF Web site. For more information, please contact Sanera at (919) 828-3876 or [email protected]. To arrange an interview, contact Mitch Kokai at (919) 306-8736 or [email protected].

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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.

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