Georgetown Co. Council advances Local Option Sales Tax proposal toward voter referendum

Georgetown County officials question how revenues from proposed sale tax would be spent

Some council members oppose the sales tax referendum, and they have raised questions about how the revenues would be spent.

Georgetown Co. Council advances Local Option Sales Tax proposal toward voter referendum

Georgetown County Council has approved the second reading of a proposed one-cent local option sales tax that could help lower property taxes.

Sales tax proposal raises concerns about spending – Coastal Observer

Georgetown County Council moved a step closer to placing a referendum on a 1-cent local option sales tax before voters in November, but two members said they have concerns about the proposal. The state law that provides for the local option tax requires that 71 percent of the revenue be used to offset property taxes. The remainder can be used for county and municipal government operations. Voters rejected the tax by 54 votes in 2024, the same time that they passed a 1-cent capital project sales tax. The capital project tax collected in the first year was $18.6 million, according to the state Department of Revenue. Council Chairman Clint Elliott said this week the county is still using the $10 million estimate for collections from 2024, which officials said at the time they thought was low. While the local option tax in 2024 was promoted as tax relief, Council Member Raymond Newton said this week he is concerned about how the revenue will be used. “It could go for any general operations that the county so chooses,” Administrator Angela Christian said. “That can be from roads, infrastructure, stormwater, safety, law enforcement, any of those kinds of things.” Newton focused on stormwater, pointing out that when the council agreed to buy the former Customs House on Front Street for $5.6 million, which he opposed, he thought the money would be better spent on stormwater projects. “We were told we presently don’t have the equipment or manpower to handle our stormwater problems,” he said. But the budget only raised spending for stormwater by $45,000. Christian said the money for equipment, $1.2 million, was included in the capital projects budget. “It’s part of our long-term strategy.” Funding for staff wasn’t included because it will take time for the equipment to arrive, she said. Newton proposed dedicating revenue from the local option sales tax to stormwater management. “Generally, every summer my phone’s ringing off the hook,” he said. “I don’t know what to tell them.” Council Member Louis Morant asked if it is possible to specify how the sales tax revenue will be spent. “Can a percentage of that amount be allocated specifically for stormwater?” Jay Watson, the county attorney, said the language of the referendum comes from state law. Changing that would open the referendum to a legal challenge. “Once the money starts coming back, then that becomes a question for council to look at,” Watson said. Morant asked how the council is supposed to sell the sales tax to voters. The council could pass a resolution expressing its intent, even though that would not be legally binding, Watson said. Council Member Bob Anderson said the time to specify spending of the county’s portion of the 29 percent revenue is in the next budget. He also had concerns about the local option sales tax, noting that it has failed in the past. “It was really considered a regressive tax because you’ve got a lot of folks in the county that do not pay enough property taxes to where they’d see a return on their investment on what they’re paying in sales taxes,” he said. Property taxes outside the Waccamaw Neck don’t cover the cost of county services to those areas, Anderson said. “Over here, we’re $5 million in the red.” The property tax credit from the sales tax applies to personal property such as vehicles and boats as well as land and buildings, Elliott said. Anderson said he accounted for that. The referendum ordinance passed on second reading 4-2 with Anderson and Newton opposed. There was no comment at a public hearing. The measure will be up for a final reading on Tuesday.