Preservation in the News

By: Rick Martiez

Don't think the war over the land transfer tax is over. The battlefield is merely shifting from the statehouse to the county seat.

The budget that Gov. Mike Easley signed into law last week gave the counties the right to assess up to a 0.4 percent tax on real estate sales. But before the new tax can be levied, the law requires counties to hold a voter referendum. These referendums will be the new battlegrounds in the transfer tax fight.

That's the word from Tim Kent, N.C. Association of Realtors head honcho. He told me Realtors are going to fight the transfer tax county by county, a strategy they've been forced to adopt.

The Realtors hoped to kill the transfer tax at the state level and spent north of $700,000 trying to convince legislators that the levy is a bad idea. That didn't happen.

I fully expected Kent to be licking his wounds when I tracked him down. Far from it, he sounded like John Paul Jones.

"The statewide campaign was Step 1," Kent said. "Step 2 is to be engaged at the local level, and we're going to be ready to operate by this fall."

Kent's brigades will need to be ready. In November, Washington County commissioners will ask voters for a 1 percent tax. That county is one of seven jurisdictions that had pre-existing General Assembly authority to levy a transfer tax.

Brunswick, Durham and Union county commissioners are also pondering a November referendum, but they can ask only for a 0.4 percent tax. Kent regards the lower rate as a victory. Nearly all transfer tax bills introduced early in the session called for a full 1 percent.

"A statewide 1 percent transfer tax rate would have had an impact of up to $720 million [annually] on taxpayers," Kent said. "The 0.4 percent rate will result in $250 million. We think our campaign reduced taxpayer impact significantly." The N.C. Association of County Commissioners estimates the 0.4 percent rate will generate $311 million.