§ 105-164.44I. Distribution of part of sales tax on video programming service and telecommunications service to counties and cities. - North Carolina Statutes

§ 105‑164.44I. Distribution of part of sales tax on video programming service andtelecommunications service to counties and cities.

(a)        (Effective untilJuly 1, 2011) Distribution. – The Secretary must distribute to the countiesand cities part of the taxes imposed by G.S. 105‑164.4(a)(4c) ontelecommunications service and G.S. 105‑164.4(a)(6) on video programmingservice. The Secretary must make the distribution within 75 days after the endof each calendar quarter. The amount the Secretary must distribute is the sumof the revenue listed in this subsection. The Secretary must distribute twomillion dollars ($2,000,000) of this amount in accordance with subsection (b)of this section and the remainder in accordance with subsections (c) and (d) ofthis section. The revenue to be distributed under this section consists of thefollowing:

(1)        The amount specifiedin G.S. 105‑164.44F(a)(2).

(2)        Twenty and sixty‑fivehundredths percent (20.65%) of the net proceeds of the taxes collected duringthe quarter on video programming, other than on direct‑to‑homesatellite service.

(3)        Thirty‑two andforty‑six hundredths percent (32.46%) of the net proceeds of the taxescollected during the quarter on direct‑to‑home satellite service.

(a)        (Effective July1, 2011) Distribution. – The Secretary must distribute to the counties andcities part of the taxes imposed by G.S. 105‑164.4(a)(4c) ontelecommunications service and G.S. 105‑164.4(a)(6) on video programmingservice. The Secretary must make the distribution within 75 days after the endof each calendar quarter. The amount the Secretary must distribute is the sumof the revenue listed in this subsection. The Secretary must distribute twomillion dollars ($2,000,000) of this amount in accordance with subsection (b)of this section and the remainder in accordance with subsections (c) and (d) ofthis section. The revenue to be distributed under this section consists of thefollowing:

(1)        The amount specifiedin G.S. 105‑164.44F(a)(2).

(2)        Twenty three and sixtenths percent (23.6%) of the net proceeds of the taxes collected during thequarter on video programming, other than on direct‑to‑homesatellite service.

(3)        Thirty‑sevenand one tenths percent (37.1%) of the net proceeds of the taxes collectedduring the quarter on direct‑to‑home satellite service.

(b)        Supplemental PEGChannel Support. – G.S. 105‑164.44J sets out the requirements for receiptby a county or city of supplemental PEG channel support funds distributed underthis subsection. The Secretary must include the applicable amount ofsupplemental PEG channel support in each quarterly distribution to a county orcity. The amount to include is one‑fourth of twenty‑five thousanddollars ($25,000) for each qualifying PEG channel certified by the county orcity under G.S. 105‑164.44J. A county or city may not receive PEG channelsupport under this subsection for more than three qualifying PEG channels.

The amount of moneydistributed under this subsection may not exceed two million dollars($2,000,000) in a fiscal year, plus the amount of any funds returned to theSecretary in the prior fiscal year under G.S. 105‑164.44J(d). If theamount to be distributed for qualifying PEG channels in a fiscal year wouldotherwise exceed this maximum amount, the Secretary must proportionately reducethe applicable amount distributable for each PEG channel. If the amount to bedistributed for qualifying PEG channels in a fiscal year is less than thismaximum amount, the Secretary must credit the excess amount to the PEG ChannelFund established in G.S. 66‑359. For purposes of this subsection, theterm "qualifying PEG channel" has the same meaning as in G.S. 105‑164.44J.

(c)        2006‑2007Fiscal Year Distribution. – The share of a county or city is its proportionateshare of the amount to be distributed to all counties and cities under thissubsection. The proportionate share of a county or city is the base amount forthe county or city compared to the base amount for all other counties andcities. The base amount of a county or city that did not impose a cablefranchise tax under G.S. 153A‑154 or G.S. 160A‑214 before July 1,2006, is two dollars ($2.00) times the most recent annual population estimatefor that county or city. The base amount of a county or city that imposed acable franchise tax under either G.S. 153A‑154 or G.S. 160A‑214before July 1, 2006, is the amount of cable franchise tax and subscriber feerevenue the county or city certifies to the Secretary that it imposed duringthe first six months of the 2006‑2007 fiscal year. A county or city mustmake this certification by March 15, 2007. The certification must specify theamount of revenue that is derived from the cable franchise tax and the amountthat is derived from the subscriber fee.

(c1)      RevisedCertification. – If a county or city determines that the amount of cablefranchise tax it imposed during the first six months of the 2006‑2007fiscal year differs from the amount certified to the Secretary under subsection(c) of this section, the county or city may submit a new certification to theSecretary revising the amount. For distributions for quarters beginning on orafter October 1, 2007, the Secretary must determine the proportionate share ofa county or city based upon certifications submitted on or before October 1,2007. For distributions for quarters beginning on or after April 1, 2008, theSecretary must determine the proportionate share of a county or city based uponcertifications submitted on or before April 1, 2008. Certifications submittedafter April 1, 2008, may not be used to adjust a county's or city's base amountunder subsection (c) of this section.

(d)        SubsequentDistributions. – For subsequent fiscal years, the Secretary must multiply theamount of a county's or city's share under this section for the preceding fiscalyear by the percentage change in its population for that fiscal year and addthe result to the county's or city's share for the preceding fiscal year toobtain the county's or city's adjusted amount. Each county's or city'sproportionate share for that year is its adjusted amount compared to the sum ofthe adjusted amounts for all counties and cities.

(e)        Use of Proceeds. – Acounty or city that imposed subscriber fees during the first six months of the2006‑2007 fiscal year must use a portion of the funds distributed to iteach fiscal year under subsections (c) and (d) of this section for theoperation and support of PEG channels. The amount of funds that must be usedfor PEG channel operation and support in fiscal year 2006‑2007 is twotimes the amount of subscriber fee revenue the county or city certified to theSecretary that it imposed during the first six months of the 2006‑2007fiscal year. The amount of funds that must be used for PEG channel operationand support in subsequent fiscal years is the same proportionate amount of thefunds that were distributed under subsections (c) and (d) of this section andused for this purpose in fiscal year 2006‑2007.

A county or city that usedpart of its franchise tax revenue in fiscal year 2005‑2006 for the operationand support of PEG channels or a publicly owned and operated television stationmust use the funds distributed to it under subsections (c) and (d) of thissection to continue the same level of support for the PEG channels and publicstations. The remainder of the distribution may be used for any public purpose.

(f)         Late Information.– A county or city that does not submit information that the Secretary needs tomake a distribution by the date the information is due is excluded from thedistribution. If the county or city later submits the required information, theSecretary must include the county or city in the distribution for the quarterthat begins after the date the information is received.

(g)        PopulationDetermination. – In making population determinations under this section, theSecretary must use the most recent annual population estimates certified to theSecretary by the State Budget Officer. For purposes of the distributions madeunder this section, the population of a county is the population of itsunincorporated areas plus the population of an ineligible city in the county,as determined under this section.

(h)        City Changes. – Thefollowing changes apply when a city alters its corporate structure orincorporates:

(1)        If a city dissolves andis no longer incorporated, the proportional shares of the remaining countiesand cities must be recalculated to adjust for the dissolution of that city.

(2)        If two or morecities merge or otherwise consolidate, their proportional shares are combined.

(3)        If a city dividesinto two or more cities, the proportional share of the city that divides isallocated among the new cities on a per capita basis.

(4)        If a cityincorporates after January 1, 2007, and the incorporation is not addressed bysubdivisions (2) or (3) of this subsection, the share of the county in whichthe new city is located is allocated between the county and the new city on aper capita basis.

(i)         Ineligible Cities.– An ineligible city is disregarded for all purposes under this section. A cityincorporated on or after January 1, 2000, is not eligible for a distributionunder this section unless it meets both of the following requirements:

(1)        It is eligible toreceive funds under G.S. 136‑41.2.

(2)        A majority of themileage of its streets is open to the public.

(j)         Nature. – TheGeneral Assembly finds that the revenue distributed under this section is localrevenue, not a State expenditure, for the purpose of Section 5(3) of ArticleIII of the North Carolina Constitution. Therefore, the Governor may not reduceor withhold the distribution.  (2006‑151, s. 8; 2006‑66, ss. 24.1(h),(i); 2007‑145, s. 9(a); 2007‑323, ss. 31.2(a), (b); 2007‑527,s. 28; 2008‑148, ss. 1, 2; 2009‑451, s. 27A.2(d).)