HomeMy WebLinkAboutC.054.93011_0714 (2)Concern Expressed Regarding Legislative Efforts to Divert Sales Tax
Revenues from Counties Such as Iredell to Low -Wealth Counties to Offset
Medicaid Costs: Commissioner Johnson said the one -cent tax was distributed on a
point of origin method and the three half -cent taxes were distributed using a population
method. Johnson said Iredell County generated almost 70% more, per capita, in sales
tax then any other county comparable to its size. He said a review of the tax revenues
showed that Iredell lost out when the proceeds were paid out using any method other
than point of origin. Johnson said there was proposed legislation in the General
Assembly, now, that would take even more of Iredell County's sales tax revenue to pay
the Medicaid costs for other counties.
OTION by Commissioner Johnson for the County Manager to (1) write a
letter expressing the board's concern about legislation that would redistribute sales
taxes in an effort to offset Medicaid costs (2) for the letter to be signed by Chairman
Tice and (3) for the letter to be sent to the entire legislative delegation for Iredell
County.
VOTING: Ayes — 5; Nays — 0.
COUNTY MANAGER'S REPORT: A written activity report was distributed by
the county manager. He noted that in the past few weeks several people had made
complaints about the county's noise ordinance. Mashburn said the ordinance may have
been sufficient fifteen years ago, but as the county's population grew, regulations for a
more urban -type setting might be needed.
Mr. Mashburn then submitted the 2005-06 Iredell County Budget. He said this
was the 17`h budget he had prepared for Iredell County, and it was the 3151 in his entire
career. Mashburn then provided an overview of the proposed budget, and a copy of his
budget message is as follows:
IREDELL COUNTY
PROPOSED FY 2005-2006
BUDGET MESSAGE
The FY 2005-2006 proposed budget is submitted in accordance with the NC state
statutes and county policy.
Revenue: For the second year in a row, we are seeing slow growth in our major source
of revenue —the property tax (ad valorem). This slower rate of growth, estimated to be about
5% shows a slight increase from the 2.5% expected last year, but is still much less than the
10%+ in previous growth.
One area that has seen some real growth this year has been the one -cent local sales
tax. However, when you look at the increase in the three Ys -cent taxes, which are distributed
back to the county using a population factor in the formula, we don't fair as well. What this
shows is that we are experiencing a double digit sales increase in the county, but when we have
to share the taxes on a state-wide basis using population estimates, much of the sales tax we
earned went to other counties experiencing slower economic growth.
I think we are finally starting to see a little breathing room that we haven't seen in the
last couple of years, but we are not far enough along to feel overly optimistic. And even as
good as the year is shaping up to be, it is still projected that we will have to use $2,800,000 of
our fund balance to totally fund the recommended budget.
Expenditures: The proposed budget shows a 6.7% increase over the revised (board
approved) budget of 04-05. However, when you take a close look at the proposed budget, you
can see that much of the growth is attributed to areas the county has little, if any, control over.
Let's begin with Medicaid. When we started the current fiscal year, the board budgeted
$4,932,666 as the county's share for Medicaid. Before this year is finished, we are likely to
spend about $5.5 million, and the request for next year is $6,176,565. This is a 25% increase
over the 04-05 budget. It will take almost one cent of the tax rate just to fund the increase in
Medicaid alone. The worse part is that if this ends up being not enough, then we will have to