Orange County Likely to Raise Sales Tax by 1/2 Cent

The N.C. House passed a bill Tuesday giving counties the option of raising their sales tax a half-cent.

The legislation also received preliminary approval Tuesday in the state Senate and will go before a final vote today.

The half-cents sales tax option comes in the wake of Gov. Mike Easley's decision to withhold county reimbursements.

The result was an estimated loss of $400,000 for Orange County, said Commissioner Moses Carey.

Easley's decision was based on a necessity to trim some expenditure in the midst of a particularly poor economic year for the state, leaving some local governments financially dry in the coming year.

Several Orange County commissioners said the county will most likely take advantage of the half-cent sales tax option.

Commissioner Alice Gordon said the state's decision to withhold reimbursements is the main cause behind the county considering the sales tax increase.

"We don't want to raise the sales tax," Gordon said. "We're talking about the well-being of citizens of Orange County."

She said planned raises for county employees and capital improvements would suffer setbacks as a result of the missed reimbursements.

Carey said the tax increase would go into effect Dec. 1.

He said the county probably would not see the relief provided by the tax revenue until next year.

He said there is a slight possibility that Orange County might be able to incur a small gain from the tax after making up the money retracted earlier in the year.

He added that the tax is going to cause problems for those with the lowest incomes in Orange County because it taxes them where they cannot afford it.

"I don't think anyone is eagerly anticipating it," Carey said.

"We just didn't have any other alternative."

Sen. Ellie Kinnaird, D-Orange, said legislators were particularly wary of raising any tax now because it is an election year and raising taxes is a threat to public approval.

Kinnaird stressed that there are few options left when facing such economic hardships as those in many North Carolina counties, including Orange County.

Kinnaird said an option available to the county is to not enact the tax until the next fiscal year begins in July 2003.

Orange County Commissioner S?B? p