Perseverance pays off with sales tax referendums

Hertford, Randolph counties latest to make successful case to voters on revenue option

• President's Perspective: Voters in Hertford, Randolph see the need
• Revenue option referendum results since November 2007

By Jason King
Assistant Communications Director

If there's one lesson learned by counties that have held a referendum on a quarter-cent sales tax increase, it may be: if at first you are not successful, keep trying. Hertford and Randolph counties did just that March 2 and joined 10 other counties that have gained voter approval to levy the Article 46 sales tax granted to counties by the General Assembly in 2007.

Randolph County first placed the referendum on ballots in May 2008, when just 30 percent of voters approved. Randolph County Manager Richard Wells said that this time the issue resounded with voters (it unofficially passed with more than 54 percent of the vote) because it was directly tied to capital needs at Randolph Community College (RCC).

"A third of the population has attended the community college, or has a family member who has attended, or knows someone who has been there," Wells said. "The community college is our only institution of higher learning – we don't have another college or university located here."

Recent community college figures showed that 44 percent of the county's unemployed, working-age adults were receiving training at RCC, and the number of students enrolled in college credit classes had reached an all-time high. With such high demand, Wells said, the college has exhausted its resources, and the need for additional classroom space and parking is evident.

"The community college did a great job about getting the word out that all money would be going to them," Wells said. "People understood that this was for the future of the county."

Wells said the county is hoping the additional sales tax will bring in $2 million annually – which would equate to roughly 2 cents on the property tax rate.

After previous failures at the polls, Hertford County gained approval for the sales tax with a whopping 87 percent of the unofficial vote. County commissioners had pointed out the county's infrastructure needs in a resolution in support of the sales tax increase, and a fact sheet made available by the county said the roughly $350,000 in projected annual revenues from the tax would "be used to lessen the need for future property tax increases."

County Manager Loria Williams said the county's education campaign targeted the school system, the community college, and other agencies that would see the benefits from the additional revenues the sales tax would bring.

"We didn't do any advertising," she said. "Our county attorney kept us very much in line with the law."

Williams said the county distributed an informational brochure and got word out on the special referendum via a "State of the County" address that aired on the county's public access channel on Time Warner Cable.

Lee County also previously had its voters reject the proposed sales tax increase before finding success in November 2009. Lee County Commissioner Amy Dalrymple, the NCACC's District 9 Director, was one of three officials to share with the NCACC Tax and Finance Steering Committee on Feb. 18 their successful – and not so successful – strategies from campaigns for local option revenue referendums.

Dalrymple credited an intense and organized grassroots effort for the county's success. During the referendum's first appearance on the ballot in May 2008, when just 44 percent of voters approved of the tax, Dalrymple said advocates would announce a presentation session at the high school auditorium, with nice printed brochures available, only to have 20 people show up. The successful campaign last fall was spearheaded by two individuals with strong backgrounds in marketing, and they focused on more intimate, personal get-togethers.

"They realized that at the end of a hard day, you don't want to leave your home on a cold rainy night and go to an old run-down auditorium and watch a PowerPoint presentation about how sorry the school is and how badly the tax is needed," she said.

Coalition members would host cook-outs, pot-luck dinners or other events at their homes. Some held mothers nights out at the local coffee and wine bar.

"That intimacy – that personal touch – of those small groups … through that we were really able to energize the county," she said.

One of the more effective tools that the coalition employed involved a voting tree model: each coalition member was challenged to develop a list of 20 people who had committed to vote for the tax. Coalition members then called back the 20 people on their sheets and asked them to get the commitments of 10 more people.

"A week before the election took place, we knew we had won," she said.

The two other panelists at the steering committee meeting – Chatham County Commissioner Mike Cross and Alexander County Manager Rick French – each experienced one local option revenue campaign. Each encountered different results, with Chatham County voters rejecting a 0.4 percent land transfer tax referendum and Alexander County voters embracing the quarter-cent sales tax.

French said the county had for a long time been making its case for the need for a new jail, so voters for the most part were already knowledgeable about the need and what the tax revenues would be used for. More than 83 percent of voters passed the measure in January 2008.

"They jumped on it right out of the gate," he said of county commissioners. "There was really no organized opposition against it."

Chatham County encountered plenty of opposition and misinformation tactics in its quest for the land transfer tax. The Raleigh-based North Carolina Association of Realtors has pumped money into each of the 21 counties that have held referendums to fight what the group terms the "Home Tax."

Cross, who co-chairs the NCACC's Legislative Goals Committee, said realtors created the misconception that the land transfer tax is an annual tax on home equity.

While realtors were the driving force behind the defeat of the land transfer tax referendum in Chatham County, they were an asset to Lee County in its quest to gain authorization to levy the quarter-cent sales tax to help renovate Lee County High School.

"Realtors were having a really hard time selling houses in that school district because of the poor condition of the high school," Dalrymple said. "So they were 100 percent behind the effort and were a great help."

Even though the realtors were on board with the sales tax, the anti-tax group Americans for Prosperity worked against the quarter-cent referendum.

"Every time they put an ad in the paper, every time they put a handout in someone's hand, it always written '.25¢.' People had in their mind – and they let the misconception continue – that it was a quarter for every dollar you spent," Dalrymple said.

Dalrymple said one of the best pieces of advice for a county considering placing a local option revenue referendum on the ballot is to make clear the real cost of the tax. For example, when advocating for the sales tax, she would ask someone if they were spending $100 on an item, would they be willing to kick in another quarter for the high school? The answer was almost always yes.

French said any board of commissioners should make clear what revenues from the tax will be used for. According to Cross, announcing that schools will be the beneficiary of the revenues gives a county its best chance at realizing the revenue option.