County eyes $100K a month from new sales tax
By Jon Hawley
Tuesday, January 8, 2019
Pasquotank County will soon receive its first payment from the new quarter-cent sales tax that voters approved in May, and the amount is a little more than expected, County Manager Sparty Hammett says.
The N.C. Department of Revenue will pay Pasquotank about $110,000 from the quarter-cent sales tax in the first month it was levied, according to Hammett and the county's latest sales tax report, provided by Finance Officer Sheri Small. The county is expecting about $100,000 a month from the new levy, Hammett noted.
The new tax will raise 1 penny for every $4 spent on applicable purchases in the county, with groceries and fuel sales excluded. Voters approved the levy in May after county commissioners said it was needed for the Elizabeth City-Pasquotank Public Schools, and pledged that revenue from it would be used for that purpose.
The state didn't start collecting the tax until October, and there's also a three-month delay between when the state collects the tax and pays revenue from it to counties. That means the county is only expecting to collect about $600,000 before July 1, the start of its next fiscal year.
Right now it’s hard to tell if the higher-than-expected collection from the quarter-cent tax will raise more than $600,000. Sales tax collections vary widely from month to month. In the last budget year, 2017-18, monthly sales tax collections varied from about $526,000 to $747,000. Collections vary not only due to the amount of sales in a month, but also because of the tax refunds that nonprofits get. Those refunds are sometimes in the six figures.
However, it appears that, based on the tax report, sales taxes are up overall compared to this time last year. The county reported $2.7 million in sales taxes for the first four months of 2018-19 versus about $2.5 million for the first four months of 2017-18. Sales tax collections this year would be even further ahead of 2017-18, but the county has paid much more in tax refunds this year than last year, based on the report.
County officials have pledged the quarter-cent levy would be used for school needs, particularly capital items such as construction and new equipment. The county has approved $2.6 million in capital projects for ECPPS this year, but the school system doesn't appear to have tapped into much of it yet.
Small, the county finance officer, reported the county has, so far this budget year, paid out about $237,000 for students' Chromebook computers, and $42,000 for engineering services for the new heating, ventilation and air conditioning system at Northside Elementary School.
Northside's HVAC is one of the big-ticket items for ECPPS this year. Last month the school board approved a $1.2 million contract for the work.