ROCKINGHAM — Although a verbal commitment had already been made, the City Council voted unanimously Tuesday to approve an interlocal agreement between the county and municipalities.
The agreement puts to rest a year-long battle between the Richmond County government and leaders of the county’s six chartered municipalities following the Board of Commissioners’ 2020 decision to change the allocation method for sales tax revenue from per capita to ad valorem.
The resulting change led many of the municipalities to raise property taxes for the first time in years and threatened smaller towns with insolvency.
Per the agreement, the county agrees to pay $728,910 to the municipalities for the current and most recent fiscal years. The payment for FY 20-21 was due June 30.
The municipalities are set to receive the following amounts per fiscal year:
- Rockingham – $252,070
- Hamlet – $240,234
- Ellerbe – $66,661
- Dobbins Heights – $76,103
- Hoffman – $63,572
- Norman – $30,270
Another part of the agreement required Rockingham and Hamlet to release claims regarding the county’s possible breach of a previous interlocal agreement for the consolidation of the 911 Center.
Richmond County Manager Bryan Land had cited the consolidation of the 911 Center as one of the reasons for the sales tax change — which Rockingham City Manager Monty Crump called “an absolute red herring.”
According to the agreement signed in February of 2015, the center is supposed to be self-sufficient, “financed by 911 fees, grants, and funds provided by the county” and the county will not charge the city for taking over the call-taking and dispatch functions.
Councilman Bennett Deane called the agreement “a tremendous, good-faith effort” on the part of Commissioner Justin Dawkins and Chairman Jeff Smart “to try to fix something that was done prior” to their election to the board.
Commissioners Don Bryant, Tavares Bostic, and Dr. Rick Watkins were the only current members who were on the board when the decision was made.
“It’s a shame that this was thrown on us the way it was,” Deane said. “But I applaud those two gentlemen, in particular, for leading this and trying to work through this the best they can, taking on a bad situation (and) doing the best they could with it.”
Deane said he thinks this agreement is the best that could be worked out and looks forward to working on long-term solutions.
The councilman added that the money from the agreement makes the city whole after the increase in property taxes. In 2020, Rockingham raised its property tax rate for the first time in 20 years.
Deane also said that Crump deserves “a tremendous amount of credit” for leading “an effort of cooperation” between the municipalities.
“I think this is a good move and a sign of good things to come,” Deane said.
One good thing that came out of the dispute, according to Mayor Steve Morris, was a strengthening of the city’s relationships with the other municipalities — especially Hamlet.
Councilman Gene Willard said that while the agreement is just a short-term solution, a long-term commitment is needed from the county.
Morris added that the municipalities also need to pay attention to what the county is doing with the revenue windfall.
“They received about $3 million dollars extra two years in a row and they’ve already budgeted to spend every bit of it,” Morris said. “There’s none in reserve for anything.”
The mayor said the county could have used the extra money to decrease the tax rate.
In 2016, a majority of the commissioners voted to decrease the property tax rate. However, then-Commissioner Ben Moss, wary of future expenses, warned and voted against the reduction. Two years later, the county had to raise the rate higher than it had been at the time of the decrease.