This week, JLF’s Joe Coletti published a research brief on municipal sales tax increases. Coletti explains that, in almost every election cycle, a North Carolina county has a quarter-cent sales tax increase on the ballot:
Since 2007, 76 counties have gone to their voters 159 times to raise the local sales tax by a quarter-cent. That is an average of 2.1 referendum elections per county.
Coletti explains, in 2007, the General Assembly gave counties the power to increase sales tax by a quarter-cent if they received voter approval. Counties began hosting special elections to approve this tax increase and saw very low voter turnout. Robeson County, for instance, saw a turnout of 4.2 percent. Of course, it is easier for the people who support a measure to get it passed when they are the only voters who show up, so the passage rate of these sales tax referenda, predictably, go up when voter turnout goes down (see image above).
Of course, the General Assembly recognized this too, so:
The General Assembly in 2013 removed the ability of counties to hold referenda on the sales tax increase outside of an already scheduled election. Cherokee and Jackson effectively found a loophole in 2016 when they scheduled their sales tax votes in conjunction with the Congressional primary. Voter turnout in Cherokee was 7 percent, and it was 11 percent in Jackson. Needless to say, both passed.
Further, Coletti writes:
Last year, seven of 12 referenda held in May, with an average turnout of 19 percent, passed. In contrast, just four of 20 held in November, when turnout was 51 percent, passed. It is not surprising, then, that only four of 60 referenda in presidential election years passed, but eight of 10 in municipal elections since the initial round of votes in 2007 did.
This is still relevant, as three counties will soon be hosting referenda on the quarter-cent sales tax increase:
Mecklenburg will try again on November 5th, this time saying the $50 million tax hike will support the arts, education, and parks. Six towns in the northern part of the county would receive earmarked funds, including four who sought the ability to create municipal charter schools in 2018.
Forsyth and Madison have scheduled their second attempts to raise taxes for March 2020. County officials there may be counting on a competitive Democratic primary and a Republican incumbent to yield a different result than we have seen in the past three presidential cycles, which had more competition on the Republican side.