Gavin Stone | Daily Journal
Mayor Pro Tem Jesse McQueen and Mayor Bill Bayless discuss the agenda with Christian at the special meeting on Thursday.
City leadership grateful for ‘clear path’ for new fiscal year
Gavin Stone | Daily Journal
City Manager Matthew Christian speaks to the Hamlet City Council on Thursday.
HAMLET — The City of Hamlet, the lone municipal holdout on signing the interlocal agreement with the Richmond County government to resolve their sales tax dispute that has raged over the last 14 months, voted unanimously on Thursday to approve the deal during a special meeting.
The county has agreed to pay Hamlet the amount of $240,234 twice, once for fiscal year 2020-2021 and once for fiscal year 2021-2022, and make other payments to the other five municipalities, in exchange for Hamlet and Rockingham ending their pursuit of a lawsuit against the county over breach of contract. This agreement effectively ends the friction that has raged since the Board of Commissioners voted in April 2020 to change to an ad valorem sales tax distribution method without prior warning, which redistributed a total of about $3 million in the first year from the municipalities to the county.
Councilwoman Abbie Covington was not present for the vote.
When asked after the vote how much this money helps the city, Hamlet City Manager Matthew Christian said it “gives us a clear path forward of what we have to work with for the next two years.”
“We’re going to have some discussions now that things are finalized about what we can get done, how much can we get done over those next two years,” Christian said. “That’s what any council … needs to do is you’ve got to have that one year-two year strategic plan.”
“We just have to operate within our means,” he continued. “I think now we know what that picture looks like … for at least the next year or two.”
Representatives from the other five municipalities signed the agreement Monday, and their respective boards will formally vote on the agreement at their next meetings. At this Monday meeting, the representatives all arrived at a consensus that they approved of the county’s offer, according to Rockingham City Manager Monty Crump.
The municipalities twice came together — in April 2020 and in March 2021 — to urge the county to switch back to the per capita sales tax distribution method, but the county refused because doing so would force them to raise their already-high property tax rate to offset their budget shortfalls, and cited the damage that raising the tax rate could have on industrial recruitment. The Local Government Commission had been flagging the county’s “unsustainable” practice of using fund balance and enterprise funds to balance their General Fund for several years, and part of the county’s effort to end these bad habits was changing the sales tax distribution method to ad valorem, which is typically advantageous to counties because they tend to have lower populations but greater presence of industrial tax customers.
The distribution of the funds by the county for 2020-2021 and 2021-2022, as laid out in the agreement, will be as follows:
• Rockingham — $252,070
• Hamlet — $240,234
• Ellerbe — $66,661
• Dobbins Heights — $76,103
• Hoffman — $63,572
• Norman — $30,270
The county is distributing a total of $1,457,820 as a result of the deal. An informal part of the agreement was a request, spearheaded by Board of Commissioners Vice Chairman Justin Dawkins, to hold quarterly meetings with municipal leaders to “shape a strategic direction for the county as a whole.”
“We look forward to moving forward,” said Christian. “It’s just time to get to work.”
Asked about the quarterly meetings, Christian said that the county and municipalities “coordinating our efforts” is “absolutely essential.”
“Communication and a shared vision for our future is absolutely essential to getting wherever it is we want to be,” he said.
Mayor Bill Bayless said this kind of cooperation had been talked about in the past but “never came to fruition.” He and Christian agreed that if the county wants to meet with the municipalities, they should go to each municipality rather than have the municipal leaders go to the county’s Administration Building so that the county leaders can gain more familiarity with the different regions.
Bayless said that he’d hope to gain more communication with the county commissioners which the city doesn’t have at the moment, except within the limited scope of the sales tax issue.
“We’ve had more [communication] in the last several months than we have had in the last 10-15 years,” he said.
