Presentation on sales tax referendum in Davidson County, presented by Max Walser during Winter 2014 NCLGBA Conference on December 11, 2014.

2. WHO PUT THIS ISSUE ON THE BALLOT?
The NC General Assembly granted county
boards of commissioners the authority to
levy, subject to voter approval, an additional
one-quarter cent (1/4¢) county sales and
use tax. On November 12, 2013, the Board
approved a resolution calling for a May 6,
2014 Special Advisory Referendum
concerning the Levy of a One-Quarter Cent
(1/4¢) County additional Sales and Use Tax.

3. WHEN WILL THE SALES TAX REFERENDUM BE
CONDUCTED?
Tuesday, May 6, 2014.

4. WHEN WOULD IT BE EFFECTIVE?
Effective on the first day of any calendar
quarter as long as the County gives the
Secretary of Revenue at least 60 days
advance notice. In Davidson County’s case
the earliest would be September 1, 2014.

5. WHAT WILL THESE FUNDS BE USED FOR?
The Board of Commissioners resolved in a
November 12, 2013 resolution to designate
funds raised through the Article 46 one-
quarter cent (1/4¢) sales and use tax for a
new High School at the Oak Grove School
site.
Hallways are very
crowded during regular
classroom changes at
North Davidson and
Ledford High Schools
Students wait to enter the
main building in an uncovered
area coming from the “Math
Pod” at North Davidson Sr
.High

6. WILL THE AREAS IDENTIFIED FOR FUNDING BE
PERMANENT OR CHANGE?
The one-quarter cent sales and use tax would
provide sufficient revenue for the
anticipated debt service for such school
construction and would enable the County
to continue necessary repairs and
improvements to other school facilities.
One of the thirteen “Cart
Teachers” at Ledford
navigates a crowded
hallway
Most of the Media Center
at Ledford has been
converted to classroom
space
North Davidson students
have class in the
hallway due to lack of
classroom space

7. Class changes to mobile
classrooms are uncovered at
both North Davidson and
Ledford High Schools
Older narrow crowded
hallways and 5 crowded
lunches are issues that
plague North Davidson

8. HOW MUCH MONEY WILL BE RAISED THROUGH
THIS TAX?
The North Carolina County Commissioners
Association estimates based on current
sales tax figures, that the one-fourth of a
penny sales and use tax would generate
approximately $2,300,000 annually.

9. HOW DOES THIS COMPARE TO PROPERTY
TAXES?
ONE PENNY IN DAVIDSON COUNTY PROPERTY TAX
RAISES AROUND $1,252,129.
ONE-FOURTH OF A PENNY IN SALES TAX IS
PROJECTED TO RAISE AROUND $2,300,000.

10. ARE THERE ITEMS EXEMPT FROM THE SALES
TAX?
There are a multitude of items that are exempt
from the sales tax including most
prescription medication, gasoline, certain
agricultural supplies and motor vehicles.
For a full listing, see North Carolina General
Statute 105-164.13.
Food (groceries) are also exempt per General
Statute 105-164.13B.

11. HAS THE SALES TAX REFERENDUM BEEN ON
BALLOTS IN OTHER COUNTIES?
Yes, since the legislature granted counties
authority to seek voter approval, many
counties have placed the referendum on a
local ballot.

12. WHAT IS THE CURRENT TAX RATE FOR
DAVIDSON AND ADJACENT COUNTIES?
The current sales tax rate for Davidson County is 6.75% or six and three quarters of a
cent for a $1.00 purchase. The North Carolina Department of Revenue has a tax
rate list of all North Carolina counties.
Sales Tax Property Tax
State Local
Randolph 4.75% 2.25% 58.60 cents
Rowan 4.75% 2.25% 62.25 cents
Forsyth 4.75% 2.00% 67.40 cents
Guilford 4.75% 2.00% 78.04 cents
Davie 4.75% 2.00% 62.00 cents
Montgomery 4.75% 2.25% 57.00
cents
Stanley 4.75% 2.00% 67.00 cents
Davidson 4.75% 2.00% (currently) 54.00 cents

13. IF THE SALES TAX PASSES DOES IT MEAN
PROPERTY TAXES WILL NOT BE INCREASED?
The sales tax lessens the pressure on
property tax but it will be up to the Board of
Commissioners to determine the property
tax rate during their annual budget
discussions. Currently property tax is the
primary source of funding for Davidson
County Government services.

14. HOW MUCH WILL THE SALES AND USE TAX
COST?
The Sales and Use tax will be 1 cent for every
4 dollar purchase.

15. HOW IS A SALES TAX DIFFERENT FROM
PROPERTY TAX?
Property taxes are assessed based on how much
property you own. Not all residents own property.
Businesses pay property taxes. Keeping property
taxes low can help encourage economic
development. Sales taxes are generated from
monetary transactions. Tourists and visitors to
Davidson County would also help support county
services through a sales tax. The 2012 Economic
Impact of Travel on North Carolina Counties
Prepared for the North Carolina Division of Tourism,
Film and Sports Development by the U.S. Travel
Association stated that this had a $4.3 million local
sales tax effect on Davidson County.

16. WHAT IS THE VOTING PROCEDURE?
Yes. Legislation specifies how the question must be presented on
the ballot:
Ballot Question. – The form of the question to be presented on a
ballot for a special election concerning the levy of the tax
authorized by this Article shall be:'[ ] FOR [ ] AGAINST
Local sales and use tax at the rate of one-quarter percent (0.25%) in
addition to all other State and local sales and use taxes.'
Note: The sale tax amount is set at a rate of .25%.

17. IF I VOTE A STRAIGHT TICKET WILL THE SALES
TAX BE COVERED?
No, all voters must mark either “For” or
“Against” if they want their vote to count on
the Sales and Use Tax.

18. WILL THE TAX BE PERMANENT OR WILL IT HAVE
A SUNSET PROVISION?
There is no sunset on the implementation of
the tax. It could be repealed in future years
by a majority vote of the Board of
Commissioners.