HOFFMAN — Hamlet City Councilwoman Abbie Covington sat surrounded by Hoffman Town Council members and one Richmond County commissioner, Don Bryant, Tuesday night to explain what the Richmond County commissioners had voted unanimously to approve three weeks prior and how it would affect the town.
It was the first time any of them, including Bryant — who voted for the change — had had the impacts of the county’s switch from a per capita sales tax distribution method to an ad valorem method explained to them in detail. Hoffman stands to lose $89,669.28 in sales tax revenue, or 85.84% of the amount they received in 2018-2019, annually, according to an analysis by the City of Rockingham of figures provided by the state.
Norman would lose 100% of its sales taxes levied, or $25,793.61, based on their 2018-2019 numbers. Dobbins Heights would lose 79.44%, or $120,185.13. Ellerbe would lose 55.61%, or $103,960.90. Hamlet would lose 40.94%, or $475,316.25. Rockingham would lose 36.3%, or $608,778.70, according to the analysis.
None of the municipalities received any prior notice that this change was being considered by the county. If this move isn’t undone by Thursday, it will be locked in for the next 12 months, at least.
“This is what makes it so serious for Norman, Ellerbe, Hoffman and Dobbins Heights: Rockingham and Hamlet will weather this, at least this year, because obviously we have a much bigger budget,” Covington explained. “We’re going to take a much bigger loss, but it doesn’t have the impact to our budget.”
At the end of the meeting Tuesday, the Town of Hoffman voted unanimously to approve a resolution urging the Board of Commissioners to return to a per capita sales tax distribution method and raise the county’s taxes “rather than placing this shortfall solely on the backs of” municipal residents.
Covington said that, in a conversation with County Manager Bryan Land in recent days, Land told her the change to ad valorem was necessary to balance the county’s budget.
Maccie Bethea, Hoffman’s town clerk, said that if Hoffman takes these cuts, the town will be “insolvent.”
Bryant said that the move seemed like “the logical thing at the time” of the vote, in part because Land said there are more than 50 other counties in the state who use an ad valorem sales tax distribution, but added, “I did not understand what I voted on, I’ll be the first to admit it.”
“Was there any discussion as to how this is going to affect these small communities?” Bethea asked Bryant.
“Do you want me to tell you the truth? No,” answered Bryant.
Later, Mayor Pro Tem Daniel Kelly asked Bryant whether the decision change to ad valorem was made after several meetings, allowing a period of time for the commissioners to study the issue, or if it was made during one meeting.
“Two minutes,” Bryant replied, referring to how long the issue was considered by commissioners.
The Daily Journal has sent Land four emails since April 10 asking why municipalities were not notified, whether he agreed with the above analysis of the impacts on municipalities, and other questions, but has received no response as of press time. A phone call was also made to his office Tuesday to request that a note be left for him to respond to the emails. Another call of this nature was made following earlier emails.
At another point in the meeting Tuesday, Hoffman Finance Officer Minnie Myers, accused the county of making the move because “it was the easiest way for them to make up a budget shortfall.” Covington added, “it was the largest revenue source they could tap without permission from any of the people they tapped it from.”
“I’m sorry that I voted for this,” Bryant said. “All of a sudden we were meeting at the old courthouse (because it allowed for social distancing), it wasn’t the best facilities set up for us. Communication was not good and we were probably all, like everybody else, ready to get out of there and I guess you can say it was shoved in on us.
“I respect Bryan Land 100%, I support him 100%,” Bryant continued. “I think we all need to share this problem … so I will let him know that I will rescind my vote.”
Many of the Hoffman Town Council members and Covington thanked Bryant for attending the meeting knowing that he would end up taking hard questions.
Covington said it was clear from her conversations with the county that this decision to change to ad valorem had nothing to do with the losses from the pandemic, and everything to do with the county’s poor financial situation. She said she had asked Land for a meeting this week but that he had turned her down.
“I’m willing to (cut our budgets) based on the (effects of the COVID-19 pandemic) but I’m not willing to do that based on the county putting the burden on us that we had no part in creating,” Covington told Bryant.
The City of Rockingham held a telephone and email poll of the City Council Tuesday to approve a resolution by unanimous consent asking for the county commissioners to rescind the vote as well, according to City Manager Monty Crump. The council will affirm the vote by a later vote of council at their next official meeting, Crump said.
Other municipalities are expected to join Rockingham and Hoffman in this action before the Thursday deadline.
Bryant cautioned those at the Hoffman meeting Tuesday night that he was only one vote on the Board of Commissioners, and a majority would be needed to overturn the move. Bryant promised to personally call other commissioners to urge them to change their minds.
Land said prior to the commissioners’ vote on this change that it would net the county 10% more of the total sales tax revenues levied to the county and municipalities, which would amount to an additional $675,000 annually. Land also stated that the move would “offset” the expenses that Rockingham and Hamlet have shifted over to the county in recent years in the form of employee salaries to staff the new 9-1-1 Center and more area over which the county must now enforce building codes.
But Rockingham found that the county will add $1,423,703.88 to its sales tax revenues annually, and increase its share of the total by 12.3%, not 10%.
Dobbins Heights Mayor Antonio Blue said in an interview Monday that, with a potential $120,185 annual cut to their sales tax revenues, the town “might last three to four years” before folding.
Ellerbe Mayor Fred Cloninger said that this is going to “hurt” Ellerbe, and that he has expressed his “disappointment” with the way the county has handled this. Cloninger said that it would take about a $0.20 tax increase to cover the cost of the cuts from the switch to ad valorem, but that he would have to “leave the state” if he did this.
“There’s no way in the world we would do a $0.20 increase,” Cloninger said. “We’re going to make some decisions, look for ways to cut some things out.”
![“The obvious goal… [is] getting NASCAR back,” Chairman Jeff Smart concluded. “Not only for financial reasons, but for quality of life. Bring it back. Let’s bring racing back to the rock. That’s what we are doing this for.”
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