§ 105-502. Use of additional tax revenue by counties. - North Carolina Statutes

§ 105-502.  Use of additionaltax revenue by counties.

(a)        Restriction. - Thecounty must use sixty percent (60%) of the amount of revenue specified in thissubsection for public school capital outlay purposes as defined in G.S.115C-426(f) or to retire any indebtedness incurred by the county for thesepurposes during the period beginning five years prior to the date the taxestook effect:

(1)        The amount ofrevenue the county receives under this Article.

(2)        If the amountallocated to the county under G.S. 105-486 is greater than the amount allocatedto the county under G.S. 105-501(a), the difference between the two amounts.

(b)        Exception. - TheLocal Government Commission may, upon petition by a county, authorize a countyto use part or all of the revenue, otherwise required by subsection (a) to beused for public school capital outlay purposes, for any lawful purpose. Thepetition must be in the form of a resolution adopted by the Board of CountyCommissioners and transmitted to the Local Government Commission. The petitionmust demonstrate that the county can provide for its public school capitalneeds without restricting the use of part or all of the specified revenue forthese purposes.

In making its decision, theLocal Government Commission must consider information in the petitionconcerning not only the public school capital needs but also the other capitalneeds of the petitioning county. The Commission may consider information fromsources other than the petition. The Commission must issue a written decisionon each petition stating the findings of the Commission concerning the publicschool capital needs of the petitioning county and the percentage of revenueotherwise restricted by subsection (a) that may be used by the petitioningcounty for any lawful purpose.

Decisions of the Commissionallowing counties to use a percentage of the revenue that would otherwise berestricted under subsection (a) for any lawful purpose are final and continuein effect until the restrictions expire. A county whose petition is denied, inwhole or in part, by the Commission may subsequently submit a new petition tothe Commission.

(c)        Reserve Fund. - Acounty may expend part or all of the revenue restricted for public schoolcapital needs pursuant to subsection (a) in the fiscal year in which therevenue is received, or the county may place part or all of this revenue in acapital reserve fund. A county must specifically identify revenue placed in areserve fund in accordance with Chapter 159 of the General Statutes.

(d)        Taxes in Effect. -For purposes of this section in determining the number of fiscal years in whichone-half percent (1/2%) sales and use taxes levied under this Article have beenin effect in a county, these taxes are considered to be in effect only from theeffective date of the levy of these taxes and are considered to be in effectfor a full fiscal year during the first year in which these taxes were ineffect, regardless of the number of months in that year in which the taxes wereactually in effect. (1985 (Reg. Sess., 1986), c. 906,s. 1; 1987, c. 622, s. 11; 1993, c. 255, ss. 2, 4; 1998-186, s. 2; 2008-134, s.13(a); 2009-395, s. 2.)