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Boone Mayor Andy Balls urges county commissioners to change the sales tax distribution method back to a per capita basis during the board’s meeting on Tuesday.

Photo by Allison Haver

Originally published: 2014-04-15 20:07:04
Last modified: 2014-04-16 16:20:39

Commissioners vote down tax distribution request

by Allison Haver

The Watauga County Board of Commissioners voted 3 to 2 to keep the ad valorem system as the sales tax distribution method.

Boone Mayor Andy Ball spoke before the commissioners on Tuesday and requested that the commissioners revert the sales tax distribution method to a per capita basis.

The tax switch would have significantly increased the revenue for the Town of Boone.


Last year, commissioners voted 3-2 to switch to a hybrid ad valorem system, which has provided more funding to Watauga County, Seven Devils, Blowing Rock and Beech Mountain.

The switch followed the Boone Town Council's vote to adapt its multi-family housing regulations, changes the council said would create more housing stock for the work force and the county said would jeopardize the sale of the former Watauga High School property.

As a result of that tax switch, the Town of Boone saw a revenue loss of about $1.7 million, while Beech Mountain, Seven Devils and Blowing Rock saw an increase.

Beech Mountain saw an extra $470,000; Blowing Rock had an extra $334,000; and Seven Devils had an extra $73,000.

Ball said that in the fiscal year of 2006-07, private businesses in the Town of Boone had historically collected 60 percent of total county sales tax revenues.


"Now under the ad valorem distribution system method we are only receiving 12 percent back to the Town of Boone that funds improvements that helps fulltime residents, tourists and the business community alike," Ball said.


According to Ball, the ad valorem method has resulted in a significant loss of revenue to the town's general fund.


"We do need to work toward a solution which benefits everyone rather than using each others taxes for political gain," commissioner Billy Kennedy said.


Town Manager Greg Young and the Town of Boone's Finance Director Amy Davis joined Ball at the meeting.

"Well back in March of last year, when you proposed the multi-family ordinance which lost us the sale of the high school, I called you and I still haven't received a call back and asked to meet with you," Chairman Nathan Miller said.


Ball said he recalled having a conversation with Miller but had taken his attorney's advice and decided not to have a direct conversation with the commissioner unless it was an official setting due to possible legal action from the county.

"As I recall you refused to meet with me," Miller said. "Then you as a council continued to meet behind closed doors to hash out statements to the press about the conflict between the county and the town," he said.


Ball said all statements were provided by the mayor and then approved at the council meetings.


"We are going back and hashing through what happened in the past and if you all would like to I can take back to council the idea of a mediation session as was proposed last year," Ball said.


If the commissioners had voted to revert to a per capita basis, the deadline to change the distribution method, to be effective for the upcoming fiscal year, is the end of April.


Miller and vice chairman David Blust said they did not believe they would be able to meet before the April 30 deadline to discuss the matter further with the all the towns.


On March 18, the town of Boone passed a resolution urging the commissioners to change the sales tax distribution method back to per capita.

The towns of Blowing Rock, Seven Devils and Beech Mountain also passed resolutions recently requesting that the commissioners uphold the ad valorem method.

Representatives from the three towns were present at the meeting to support the commissioners in their decision to keep the ad valorem method.

UPDATE: The original version of this story has been updated to include more information.