North Carolina State Senate Moves Ahead on Local Sales Taxes

Transport Politic, August 6, 2009

Following an April vote in the House, the Senate appears to be close to allowing the Triangle and Triad to fund new transit systems.
After years of controversy revolving around the regressive nature of sales tax increases, the North Carolina State Senate yesterday tentatively approved a measure that would allow citizens in the Triangle and Triad metropolitan areas the right to vote to increase their local sales taxes by $0.005 on every dollar to pay for transit improvements. Mecklenburg County, which includes the state's largest city (Charlotte), has been taxing itself a similar amount since 1998 after the legislature allowed it and it alone to expand its tax base. The bill, if approved later this week as expected, will also allow less urban areas in the state to push sales taxes by $0.0025 to fund transportation.
The measure passed the state house in April and will let the cities of Raleigh, Durham, and Chapel Hill in the Triangle and Greensboro and Winston-Salem in the Triad construct ambitious transit networks, but only if the citizenry of their surrounding counties can be cajoled into voting for tax increases. The state will require all counties wishing to fund transit to conduct local referenda before the sales taxes can be implemented. Votes are expected in 2010 if the economy improves sufficiently.
A DMU regional rail system connecting Raleigh and Durham came close to receiving federal funds in the early 2000s, but it was shot down because of Washington's strenuous cost-efficiency regulations. A new regional advisory commission released a report in 2008 proposing an even more ambitious project, with lines reaching 50 miles through the Triangle region. New streetcars could serve the downtowns of the two inner cities, and many more buses would extend through what is one of America's fastest growing regions. A $0.005 sales tax would be an efficient way of funding the new network.
Meanwhile, Greensboro and Winston-Salem have been planning a new light rail connector between each downtown, though their project is not as far advanced. The new tax, if approved, would allow planning and construction to go ahead.
Each region, however, is sprawling and will have a hard time meeting the cost-effectiveness guidelines required by the Feds because of likely low ridership compared to proposed lines in other cities. This barrier could be insurmountable unless they significantly reform their land use policy to encourage dense, station-oriented growth. Without money from Washington, both the Triangle and the Triad will be doomed to smaller and less effective transit lines.

Public Transportation Bill One Step Closer to Law

The Progressive Pulse, August 4, 2009
Stephen Jackson

A bill granting local governments the option of placing a public transportation sales tax referenda before votes sailed through Senate Finance today.
H148 allows Triad and Triangle counties to place a half cent sales tax referendum on the ballot as Charlotte has on two occasions in the past decade, with the remaining 94 counties granted a quarter cent local option referendum. The bill also allows all counties in North Carolina, providing they operate or have within their boundaries a public transportation system, to levy a $7 local vehicle registration fee to be used for public transportation. The bill also establishes a non-highway equivalent of the Highway Trust Fund to be used to match local (and federal) public transportation monies, as well as provide grants to ports and rail operations. The fund will be (no surprise given the economy) initially un-funded.
After a build-up of some months, the vote on H148 was anti-climatic. After the House easily passed the bill in April, budget difficulties and several false alarms when the bill was pulled from the Senate Finance Committee agenda at the last minute, promoted doubts that the bill would get a hearing on the Senate side this year.
Thanks to the perserverance of the bill sponsors and key advocates, a hearing of a little over 10 minutes with just two questions was all it took for the bill to leap to the Senate Finance hurdle. It now goes before the full Senate possibly as early as tomorrow as legislators struggle to pass the budget and get out of Raleigh before next week.
The vote came as a pleasant surprise to advocates for the bill who spent hours leading up to the vote shoring up support and worrying about possible opposition from influential Senators and opposed to local option sales taxation. That oppoisition did not materialize in the face of a broad, bi-partisan and well-organied coalition of supports and legislators. Those sick of waiting for the bus or train are hoping that the Senate floor vote is as clear cut.