Commissioners promise to use 85% of Land Transfer Tax for schools

Posted Tuesday, October 2, 2007

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Pittsboro, NC - To clarify its intent to use most of the land transfer tax revenues for schools, the Chatham County Board of Commissioners voted unanimously today to restrict 85% of revenues for this purpose. The restriction is effective until at least the end of 2010, when a majority of the board will be up for re-election. County staff estimates that this action will provide about $2 million in additional revenues each year for school needs.

“There seems to have been some confusion about this issue. Some have said we are taking money away from the schools by reducing the impact fee,” Vice Chairman George Lucier stated, explaining why he made the motion to restrict use of the land transfer tax. “Commissioners had previously agreed in principle to using most of the tax for school needs, but today’s vote makes it official and explicit,” Lucier said.

Commissioners voted last month to reduce the county’s school impact fee from $2,900 to $1,900 if the land transfer tax is approved by county voters in November. By restricting the funds for school needs, the commissioners ensured that Chatham County Schools will have additional revenues to meet increased needs for facilities, even with the reduction in impact fees.

Residents of the county are encouraged to learn more about the proposed 0.4% land transfer tax, which is slated for a vote on the upcoming Nov. 6 ballot. To provide citizens with educational materials and opportunities for questions, the Board has scheduled community meetings around the county with three meetings remaining:

Thursday, Oct. 4: Chatham Central High School Auditorium, 14950 NC Highway 902 West, in Bear Creek (southwest Chatham), 7 pm. Directions: Take NC 902 West from Pittsboro and cross over US 421. Go about two miles to the school on the right.

Thursday, Oct. 11: Liberty Chapel United Church of Christ (sanctuary), Old US 1, Moncure, 7 pm. Directions: Pittsboro-Moncure Road dead ends at Old US 1 in Moncure. Turn left on Old US 1 and go about one mile to the church.

Thursday, Oct. 18: Eastern Chatham Senior Center, 365 Highway 87 North, Pittsboro, 7 pm. Directions: From the courthouse circle in Pittsboro, head west on US 64 Business (also West St.). At the first stoplight, take a right on Graham Road (NC Hwy. 87 North) and go about one-third mile. The senior center will be on your left.

If approved by county voters on Nov. 6, the 0.4% land transfer tax would provide an alternative revenue source to fund county facilities, especially schools. The proposed tax is a one-time assessment on real estate property sales.

With the reduced School Impact Fee, the net gain in county revenues would be $2.5 million in 2008-09, which is the same as a 3.4-cent property tax increase. Of the $2.5 million net gain, $1.9 million would be restricted for schools. Below is a summary of the net increase for school needs over the next five years.

Additional Revenue for School Needs
FY 2008 916,108.30*
FY 2009 1,923,827.44
FY 2010 2,020,018.81
FY 2011 2,121,019.75
FY 2012 2,227,070.74
*NOTE: The land transfer tax would only be in effective for a half-year so proceeds would be reduced.