Sales-tax plan keeps NC from making winners in all areas

It’s the time of year that North Carolinians love with such passion – March Madness. And while we each may have a favorite team, inevitably there is a pride we share when any North Carolina team advances (even if we don’t verbalize it).

That mentality should be the same for our legislative policies. The rhetoric of “urban versus rural” shouldn’t be in our collective vocabularies. In fact, when it comes to economic success, we should be rooting for the same team: North Carolina.

On Monday, lawmakers revealed a plan to redistribute sales-tax revenue to funnel more dollars to rural communities. Currently, a portion of sales-tax collections is distributed to counties based mostly on where the sale occurs, but the proposal would change that formula to redirect the dollars to where they live.

These changes would punish the largely metropolitan counties that use those sales-tax dollars to build and maintain the infrastructure necessary to support large retail centers. Sales-tax dollars collected from in-county and out-of-county shoppers are used to build and maintain the roads leading to the retail centers and to pay law enforcement officers who respond to needs on those roads.

According to projections by legislative staff, Wake County and its cities and towns would collectively see a drop of about $18 million, or 13 percent. Mecklenburg County and its towns and cities would lose about $35 million, a 16 percent drop.

That’s real money for growing areas with growing needs. Currently, cities have limited revenue-raising options for filling those budget gaps. Legislators have suggested that metro cities and counties can raise their property tax rates to offset the losses, but many people moving to North Carolina come from Northeastern states that have higher property taxes. Raising property taxes could have a chilling effect on attracting future development to North Carolina and affect all parts of the state.

When we pick winners and losers through income redistribution, we divide our state.

Instead, we should create a strategy for growth and opportunity that builds on all our strengths. Each region of our state needs a strategic economic development plan based on its regional assets and workforce. Each region’s strategy should be unique and focused on real expectations, achievable goals and the reality of precisely how a region wants to grow.

Let’s build economic development strategies around the job centers in rural parts of our state, places like Hickory, Jacksonville and Rocky Mount. Let’s invest in what each of those job centers needs in terms of education, infrastructure and marketing. Let’s bring more jobs to existing job centers, which can support the whole region. Let’s use our state’s new transportation strategy of “hub and spoke” to get as many folks as we can within a reasonable commute of a job center with low unemployment through strategic investment.

For more than 20 years, North Carolina has invested hundreds of million in strategies to support rural North Carolina. And yet our rural areas are still struggling with high unemployment, lack of opportunities and shrinking populations. Instead of picking winners and losers, let’s develop a strategy that aims to raise all boats. As Abraham Lincoln said, “You cannot make the weak stronger by making the strong weaker.”

Let’s leave the brackets to basketball and develop a strategy that makes real progress toward one North Carolina. Our metro regions are prepared to do our part to help those struggling with high unemployment and lack of opportunity – we believe in shared successes and wins for everyone. The Metro Mayors Coalition stands ready to work with the legislature to develop a plan that will advance all of North Carolina.

This story was originally published March 24, 2015 at 2:11 PM with the headline "Sales-tax plan keeps NC from making winners in all areas."