State sales tax change could send millions of dollars back to rural areas

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WINSTON-SALEM, N.C. -- When you search the parking lot of a big bulk store it won’t be long until you see shoppers packing their cold items into a cooler.

That’s because several of them have 30 minutes or more to drive to reach home.

“In Davidson County, we don't have a store like Sam’s or Costco,” said Jack Thrift Jr., who said he makes the drive each week to pick up meat and other items for large community meals.

“Today I picked up pork tenderloin,” said Thrift who has around 300 cancer survivors to feed later this week at Center United Methodist Church in Welcome.

A new proposal in the North Carolina Senate would help areas like Welcome benefit from the money its residents spend in bigger urban areas that retailers are drawn to.

Senate Majority Leader Harry Brown, from Onslow County, introduced a bill on Monday that would redistribute sales tax money in North Carolina on a per capita basis. That could cost large urban areas like Charlotte and hot tourist spots along the coasts and send millions of dollars into rural areas unable to draw big box retailers and hotels on their own.

“So citizens from our mostly poor, rural counties no longer involuntarily redistribute their tax dollars to subsidize a few rich urban counties when they drive to those areas to spend their money,” said Brown.

Brown said that could help rural areas afford infrastructure improvements and school upgrades that they haven’t had the money for in recent years.

But mayors from larger cities are ready to fight the move. Winston-Salem Mayor Allen Joines believes the current system of sales tax distribution helps bigger cities maintain the infrastructure needed to draw retailers and shoppers to urban areas.

“Individuals that are coming into our city to utilize our services ride on our streets, use the traffic signals -- sales tax helps pay for that,” said Joines. “It helps keep the streets maintained and keep the city running so to speak.”

Joines believes if the bill is signed into law Winston-Salem stands to lose more than $3 million with the redistribution of sales tax money.

“It’s going to be a long-term detriment to the state,” said Joines.

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