Local Government Division and Tag & Tax Update NCGFOA 2018 Summer Conference July 15-17, 2018 Holiday Inn, Wrightsville Beach

Local Government

What’s New? Distribution Unit moved to Financial Services Retirement David Baker, NC County Commissioners’ Assoc. Organization Tony Simpson, Director Mike Connolly, Assistant Director Doug Huffman, Real Property Manager Tina Stone, Personal Property Manager Vacant, Public Service Manager

Goals Quality customer service Increased presence in counties Improve Tag & Tax user experience On-demand data reporting Efficient data distribution Well formatted exports Documents explaining reports Actionable data Data accuracy

Public Service Certified value of $34 billion for FY 2017-18 60% of value from three companies Duke Energy Carolina Duke Energy Progress Piedmont Natural Gas Overall state increase for FY 2018-19 Variations at county level

Information Unit TR-1 and TR-2 New information database Enhancing automation process Implementing data import capabilities Additional data verification User-friendly forms Warning messages to identify errors New information database Capability to cross reference databases Additional report options Data quality verification

Property Tax Reappraisal standards Appeal manual update Published and distributed to all assessors Workshop being developed Appeal manual update Exemption manual update Improved correspondence/forms

Education Property Tax Education Partnership NCDOR and UNC School of Government Increased quality and offerings Reduced cost

Tag & Tax

Tag & Tax MyDMV VTS hardware replacement Card reader replacement Paid tax receipts Registration and license renewal Reduced taxpayer phone calls VTS hardware replacement Card reader replacement LPAs Driver license offices

Tag & Tax PayIt mobile app Vendor online payments New report database Processing fee for citizens New report database Working group to address revenue concerns NCDOR NC Association of County Commissioners NC League of Municipalities

FY 2015-16 Collections RENEWAL MONTH TOTAL VPT COLLECTION TOTAL FEES NET VPT COLLECTION JULY $75,469,949 $2,182,066 $73,287,883 AUGUST $74,306,274 $1,968,267 $72,338,008 SEPTEMBER $68,201,359 $1,973,687 $66,227,671 OCTOBER $71,657,364 $1,263,060 $70,394,304 NOVEMBER $58,574,118 $2,674,601 $55,899,517 DECEMBER $65,224,369 $2,132,954 $63,091,415 JANUARY $62,324,860 $2,024,631 $60,300,230 FEBRUARY $72,154,715 $2,273,469 $69,881,246 MARCH $81,279,002 $2,452,061 $78,826,941 APRIL $77,577,571 $1,445,771 $76,131,800 MAY $77,472,338 $2,337,437 $75,134,901 JUNE $80,248,215 $2,313,698 $77,934,517 TOTAL $864,490,135 $25,041,702 $839,448,433

FY 2016-17 Collections RENEWAL MONTH TOTAL VPT COLLECTION TOTAL FEES NET VPT COLLECTION JULY $82,421,055 $2,460,971 $79,960,085 AUGUST $88,476,273 $2,341,261 $86,135,012 SEPTEMBER $76,668,205 $2,379,980 $74,288,225 OCTOBER $69,821,206 $2,090,125 $67,731,081 NOVEMBER $64,009,618 $2,019,610 $61,990,008 DECEMBER $64,710,390 $2,217,519 $62,492,871 JANUARY $72,990,061 $2,268,476 $70,721,585 FEBRUARY $72,189,326 $2,259,749 $69,929,577 MARCH $90,320,565 $2,655,877 $87,664,688 APRIL $75,978,572 $2,333,900 $73,644,672 MAY $83,689,818 $2,491,438 $81,198,380 JUNE $85,513,537 $2,420,578 $83,092,959 TOTAL $926,788,627 $27,939,484 $898,849,143

FY 2017-18 Collections RENEWAL MONTH TOTAL VPT COLLECTION TOTAL FEES NET VPT COLLECTION JULY $84,114,784 $2,304,271 $81,810,513 AUGUST $87,191,349 $2,328,308 $84,863,041 SEPTEMBER $73,938,009 $1,363,813 $72,574,196 OCTOBER $74,173,205 $2,182,873 $71,990,332 NOVEMBER $66,321,160 $2,072,955 $64,248,205 DECEMBER $68,661,757 $2,284,481 $66,377,276 JANUARY $73,472,131 $2,298,806 $71,173,325 FEBRUARY $77,165,217 $2,356,462 $74,808,755 MARCH $87,406,981 $2,614,881 $84,792,100 APRIL $84,689,330 $2,532,107 $82,157,224 MAY $84,812,875 $2,596,280 $82,216,595 JUNE $87,979,099 $2,487,796 $85,491,303 TOTAL $949,925,897 $27,423,033 $922,502,865

Tax & Tag Collections FISCAL YEAR TOTAL VPT COLLECTION TOTAL FEES NET VPT COLLECTION 2012-13 $570,960,352 ? 2013-14 $791,064,785 $26,079,920 $764,984,864 2014-15 $799,217,506 $24,552,760 $774,664,746 2015-16 $864,490,135 $25,041,702 $839,448,433 2016-17 $926,788,627 $27,939,484 $898,849,143 2017-18 $949,925,818 $27,423,033 $922,502,865

VTS Reporting Challenges Reports unavailable before 11:00 AM Database restoration and indexing lengthy Report timeout Difficulty processing large amount of data Information extraction Explore multiple reports to locate information Financial reconciliation Difficulty identifying problem bill – manual

VTS Reporting Challenges Database size increasing No solution for data archiving No dashboard – KPIs KPI data not consolidated No alerts when something goes wrong

Next Steps Satisfy audit requests Consolidate reports Ad-hoc reporting Reports to fulfill state and county business needs Consolidate reports Ad-hoc reporting Validate integration points Improve finance reconciliation Easy method to find problem bills Specify format of STARS finance file to import into VTS

Next Steps Identify critical areas for monitoring Drill down errors Alerts and notifications Archiving historical data Set time limit for storing in operational database Determine data purge criteria Improve VTS application performance and database maintenance

Next Steps Identify critical areas for monitoring Drill down errors Alerts and notifications Archiving historical data Set time limit for storing in operational database Determine data purge criteria Improve VTS application performance and database maintenance

Legislation

Legislation Session Law 2018-5: Appropriations Act of 2018 Section 38.9(a) – Amends N.C.G.S. §105-395.1 - Effective July 1, 2017 Adjusts weekend and holiday provision Includes tax office and USPS closures State/local government disaster declarations Section 38.10(d) – Amends N.C.G.S. §105-282.1 – Effective June 12, 2018 Establishes single exemption application Charter schools Qualifying mobile classrooms Certain energy mineral interest properties Lands held in trust for Eastern Band of Cherokee Indians

Legislation Session Law 2018-95: PUV Changes Amends N.C.G.S. §105-277.15 – Effective July 1, 2019 Expands Wildlife PUV Hunting and fishing reserves Shooting Wildlife observation Wildlife activities Increases acreage cap to 800 acres for new designations

Legislation Session Law 2018-98: Violate Tax Law/Venue/Property Tax Section 1 - Amends N.C.G.S. §105-275 – Effective July 1, 2019 Exempts leasehold interest in exempt real property Session Law 2018-114: Regulatory Reform Act of 2018 Section 25 - Amends N.C.G.S. §105-275 – Effective July 1, 2018 Expands exemption of qualifying personal property and mobile classrooms of for profit charter schools

Legislation Session Law 2018-113: NC Farm Act of 2018 Section 9 - Amends N.C.G.S. §106-741 – Effective June 27, 2018 Land records must provide notice of certain farms Poultry, swine, dairy, and other qualifying farms Voluntary agricultural districts Section 14 - Amends N.C.G.S. §105-317.1 – Effective July 1, 2019 Counties must use DOR schedule if valuing farm equipment by cost Section 15 - Amends N.C.G.S. §105-278.2(a) – Effective July 1, 2019 No application, survey or plat required to exempt family cemeteries

Pending Legislation Senate Bill 153: Military Retiree State Income Tax Relief Section 3(a) – Proposed Amendment of N.C.G.S. §105-277.1C Increase Disabled Veteran Homestead Exclusion from $45,000 to $100,000 Proposed effective date is July 1, 2019 Section 3(b) - Proposed Addition N.C.G.S. §105-277.1E Create homestead exclusion for surviving spouses of emergency personnel officers killed in the line of duty Section 5 - Proposed Amendment of N.C.G.S. §105-278.2 Exempts commercial property held for sale, rental or burial rights

Local Government Division Questions? Tina Stone, PPS Local Government Division tina.stone@ncdor.gov