1. LOCAL GOVERNMENT DISTRIBUTIONS
UNDERSTANDING THE MONEY

2. Agenda Website Overview of Smaller Distributions
Utilities Sales Distribution
Overview of Sales Tax
Distribution Specifics
New Laws
Proposed Legislation

3. Website www.dornc.com Local Government Link from Main Page
Redesign Coming Soon
Local Government Link from Main Page
One-Stop Shop
Property Tax
Distribution Unit
Schedule of Distributions
Documentation of Distributions Made
Information Unit

4. Smaller Distributions
Quarterly Distributions
Based on Populations
Distributed 1 & ½ months after the end of the quarter
Scrap Tire
Counties Only
White Goods
If Eligible per DENR
Solid Waste
Counties and Cities

5. Other Distributions Alcoholic Beverage Tax Distribution Excise Tax
Not Sales Tax
Eligibility based on:
Is it Legal to Sell Alcohol in your City/County?
Distributed based on Per Capita %
Distributed Once a year in May
Medicaid Hold Harmless
Hold Harmless from the repeal of Article 44 (1/2 % Sales Tax)
Counties only
Cities have the City Hold Harmless component of Sales Tax
Distributed in two installments
90% estimation in March, 10% in August
Can result in overpayments, that must be paid back in August

6. Utilities Sales Distribution
Excise Tax on Piped Natural Gas – Repealed 6/30/2014
Franchise Tax on Electricity – Repealed 6/30/2014
Utility Franchise Distribution  Utilities Sales Distribution
Four main components
Sales Tax on Electricity
Sales Tax on Piped Natural Gas
Sales Tax on Telecommunications
Sales Tax on Video Programming
Cable, Satellite, Telecommunications
PEG Channel Funding
Distributed Quarterly
Distributed 2 & ½ months after the quarter ends

7. Utilities Sales Distribution
Distribution of Sales Tax on Video Programming &
Distribution of Sales Tax on Telecommunication
Calculated by using a combination of historical data and population data
Distribution of Sales Tax on Electricity &
Distribution of Sales Tax on Piped Natural Gas
Calculated by using a combination of historical data and ad valorem data
No longer based on location of service
Historical Data (FY ) is now 3 years old and should be out of statute
PEG Channel Funding
$4 Million per year divided up amongst all the channels
$1 Million per quarter

8. Sales Tax Current Articles Article 39 = 1% Article 40 = ½%
Article 43 = ½% Transit Tax
Article 46 = ¼% County Tax
Repealed Articles
Article 44 & 45
Food Tax: 2%
Articles 39, 40, & 42
All counties levy the basic two percent local tax. That is comprised of Articles 39, 40, & 42. Durham Mecklenburg, and Orange Counties currently levy the half percent Article 43 transit tax. 29 counties levy the extra quarter percent article 46 tax (Soon to be 31 with Jackson and Cherokee). Article 45 was for Dare county only (beach nourishment) and was repealed in Article 44 was an additional one half percent for the counties, but it was repealed in Amounts continue to populate the reports as old returns and requests for refunds are filed.

9. Sales Tax Allocations Articles 39, 42, 43, & 46 Point of Collection
Per Capita
Then Multiplied by Legislative Factors
Food
Article 39 Uses Historical Percentages
Articles 40 & 42 Use Current Population Percentages

10. Distributing between the County and Cities
Each County gets to choose its method of Distribution
Ad Valorem
Per Capita
We use these percentages to distributed the allocations between the County and the Cities
Except for Articles 43 and 46 which stay with the county.

11. City Hold Harmless
The City Hold Harmless was designed to hold the cities harmless from the repeal of Article 44.
Calculated using Article 39 and Article 40 amounts.
The counties are required to pay the cities these amounts.
These amounts also figure into the medicaid hold harmless for the counties.
Confused Yet? Article 44 was distributed using an allocation that was half point of sale, and half per capita. So in order to calculate the city hold harmless, we use article 39 which is point of sale, and article 40 which is per capita.

12. Recent S&U Expansion 2014 Prepaid meal plans - Universities
Admission Charges – Ticket Sales
Service Contracts
2016
RMI: Repair, Maintenance, and Installation Charges
Began 3/1/2016, March Sales, April Collections
New Distribution Rules Took Effect for July 2016 Collections, June 2016 Sales
Effect of the 2014 Law changes was that certain counties benefited more than others. The legislature changed the Distribution Laws for 2016 to try and help the counties that did not benefit so much from the prior law changes.

13. G.S. 105-524 (b) Subtract $84.8 million from all counties
From Articles 39, 40, & 42
Taken Proportionately based on point of sale
(c) Add the $84.8 million back to the counties
Added to Article 44
Added Based on Legislative Percentages
79 Counties have a defined percentage. 21 Counties get zero.
(e) Add in 17.6 million from the state portion
REPEALED in the short session
Since all counties lose a portion of the 84.8 million and gain a portion of the 17.6 million, they all lose 67.2 million. But they also all gain from the expansion of sales tax. The legislative percentages range from 0.02% for Pasquotank County up to 5.17% for Harnett County. When they made the law during the 2015 long session, they included a 17.6 million pool of money to go back to the counties. They repealed section (e) of this law during the short session as a provision of the budget.

14. G.S
These funds are distributed between the county and cities using the same Ad Valorem % or Per Capita % used for other articles.
Counties must use these funds for specific economic or education purposes
In Subsequent years
The 84.8 million used in part (b) and (c) may change according to yearly sales tax growth/shrinkage.
In 16-17, we had 7.34% growth. So the amount has grown to $91,022,
Economic development, public education, or community colleges

15. Report: Article Overview
Show a copy of possible Reports

16. Report: Article Overview

17. Summary Report
These are the amounts that you are actually receiving. These amounts may be used for your accounting purposes.

18. Contact Us D. Ernest Irving (919) 814-1118 Deane.Irving@ncdor.gov
Cindy Matthews, Distribution Unit Supervisor
Information Unit & Property Tax
(919)
George Hermane, Manager Information Unit
Tina Stone, Manager Personal Property Tax
Doug Huffman, Manager Real Property Tax
Mike Connolly, Manager Public Utilities
New Director of Local Government Division: Tony Simpson