North Carolina § 105-522 - City hold harmless for repealed local taxes.

§ 105-522. City hold harmless for repealed local taxes.

Definitions. - The following definitions apply in this section: Eligible municipality. - A municipality that was incorporated on or before October 1, 2008, and receives a distribution of sales and use taxes under G.S. 105-472. Hold harmless amount. - The sum of the following amounts allocated for distribution to a municipality for a month. The references in this subdivision to Article 39 of this Chapter and Chapter 1096 of the 1967 Session Laws and Articles 40 and 42 of this Chapter do not include the adjustment made pursuant to G.S. 105-524. The amounts are as follows: The amount of sales and use tax revenue allocated under G.S. 105-486. This calculation determines the effect of repealing a one-half percent (1/2%) sales and use tax distributed on a per capita basis. An amount determined by subtracting twenty-five percent (25%) of the amount of sales and use tax revenue allocated under G.S. 105-472 or Chapter 1096 of the 1967 Session Laws from fifty percent (50%) of the amount of sales and use tax revenue allocated under G.S. 105-486. This calculation determines the effect of distributing a one-quarter percent (.25%) tax on the basis of point of origin instead of on a per capita basis. Requirement. - A county is required to hold the eligible municipalities in the county harmless from the repeal of the local sales and use taxes formerly imposed under this Article. The Secretary must add an eligible municipality's hold harmless amount to the amount distributed to the municipality under this Subchapter. To obtain the revenue for the hold harmless distribution, the Secretary must reduce each county's monthly allocation under G.S. 105-472(b) or under Chapter 1096 of the 1967 Session Laws by the hold harmless amounts for the municipalities in that county. History (2007-323, ss. 31.16.3(f), 31.16.4(c); 2007-345, s. 14.4(a); 2008-134, ss. 14(a), 15(c), (f), (g); 2015-268, s. 10.1(e3).) Editor's Note. - Session Laws 2007-323, s. 31.16.4(c), which amended subsection (a), effective October 1, 2009, and applicable to distributions for months beginning on or after that date, was repealed by Session Laws 2008-134, s. 15(c), effective July 28, 2008. Session Laws 2007-323, s. 31.16.4(e), which was repealed by Session Laws 2008-134, s. 15(e), effective July 28, 2008, provided: "For fiscal year 2009-2010, the repealed sales tax amount determined under G.S. 105-522(2)(a)(2) b, as enacted by this section, and G.S. 105-523(a)(2) b, as enacted by this section, is calculated based on twenty-five percent (25%) of the amount distributed to a municipality or county under Article 39 of Chapter 105 of the General Statutes or Chapter 1096 of the 1967 Session Laws on or after October 1, 2009, less the amount distributed to the municipality or county on the basis of point of origin under repealed G.S. 105-520(a) in October, November, and December of 2009." Session Laws 2007-323, s. 1.2, provides: "This act shall be known as the 'Current Operations and Capital Improvements Appropriations Act of 2007'." Session Laws 2007-323, s. 32.3, provides: "Except for statutory changes or other provisions that clearly indicate an intention to have effects beyond the 2007-2009 fiscal biennium, the textual provisions of this act apply only to funds appropriated for, and activities occurring during, the 2007-2009 fiscal biennium." Session Laws 2007-323, s. 32.5 is a severability clause. Session Laws 2007-345, s. 14.4(a), which amended subdivision (a)(2), effective October 1, 2009, and applicable to distributions for months beginning on or after that date, was repealed by Session Laws 2008-134, s. 15(f), effective July 28, 2008. "For fiscal year 2009-2010, the hold harmless amount determined for a municipality under G.S. 105-522 and the repealed sales tax amount determined for a county under G.S. 105-523 is reduced by the amount distributed in October, November, and December of 2009 to the municipality or county on the basis of point of origin under repealed G.S. 105-520(a)." Session Laws 2015-268, s. 10.1(i), made the last sentence of subdivision (a)(2), as added by Session Laws 2015-268, s. 10.1(e3), effective July 1, 2016, and applicable to local option sales taxes collected on or after that date and distributed to counties and cities on or after September 1, 2016. Effect of Amendments. - Session Laws 2007-323, s. 31.16.4(c), effective October 1, 2009, and applicable to distributions for months beginning on or after October 1, 2009, in subdivision (a)(2), added "the sum of the following:" at the beginning of the introductory paragraph, designated the former provisions of subdivision (a)(2) as subdivision (a)(2)a., and added subdivisions (a)(2)b. and (a)(2)c. Session Laws 2007-345, s. 14.4(a), effective October 1, 2009, and applicable to distributions for months beginning on or after that date, inserted "distributed to a municipality for the month" in subdivision (a)(2); deleted "Chapter to the municipality for a month" in subdivision (a)(2)a.; in subdivision (a)(2)c., substituted "by subtracting twenty-five percent (25%) of the amount of sales and use tax revenue distributed under Article 39 of this Chapter or under Chapter 1096 of the 1967 Session Laws from fifty percent (50%) of the amount distributed under Article 40 of this Chapter" for "under sub-subdivision a. of this subdivision subtracted from the amount determined under sub-subdivision b. of this subdivision" in the first sentence, and deleted the last sentence. Session Laws 2008-134, s. 14(a), effective October 1, 2008, and applicable to distributions for months beginning on or after that date, in subdivision (a)(2), substituted "allocated under G.S. 105-486 for distribution to a municipality" for "distributed under Article 40 of this Chapter to the municipality for a month, other than revenue from the sale of food that is subject to local tax but is exempt from State tax under G.S. 105-164.13 B"; and in subsection (b), substituted "otherwise allocated to the municipality for distribution under" for "distributed to the municipality under" in the second sentence, and substituted "the amount otherwise allocated to a county for distribution under Article 39 of this Subchapter" for "each county's monthly allocation under G.S. 105-472(b) " in the third sentence. Session Laws 2008-134, s. 15(g), effective October 1, 2009, and applicable to distributions for months beginning on or after that date, rewrote subdivision (a)(2). Session Laws 2015-268, s. 10.1(e3), added the last sentence of subdivision (a)(2). For effective date and applicability, see Editor's note.