1000 x 90

Time is of the Essence for Negotiations Between Watauga, Boone Regarding Sales Tax, Ball and Miller Both Cry Foul

By Jesse Wood

April 12, 2013. Unless a last-minute meeting, which is still a possibility, is scheduled between the Boone Town Council and Watauga County Board of Commissioners, the sales-tax distribution switch from per capita to an ad valorem basis will be up for a vote on Tuesday. By state law, the deadline to pass such a proposal is the end of April. 

And Chairman Nathan Miller says he has the majority of votes needed.

The towns of Seven Devils, Beech Mountain and Blowing Rock passed resolutions supporting the potential switch earlier this week and agreed to – as Miller calls it, a “hybrid solution” – a 40/60 split of the revenue, where each town would give back 60 percent of the added revenues from the change to Watauga County, thus preventing the county from going in the red because of the switch.

This 40/60 resolution doesn’t affect the fact that Boone would lose more than $2 million in sales tax revenue on an ad valorem basis.

Initially, Miller believed Watauga County would end up with a surplus of around $1.5 million due to the 40/60 split.

However, Miller said that on Good Friday he found out through the N.C. Department of Revenue that every taxing jurisdiction, including the local fire departments, which do not receive per capita funds, get a cut of the ad valorem revenues. While researching factors involved in the switch, Miller said staff at the Department of Revenue didn’t alert county staff to the surplus the fire districts would receive. 

“I am not happy with the Department of Revenue,” Miller said.

Yet, Miller said, the county still stands to gain $500,000 through the process, adding that these numbers are based on last year’s sales tax figures.

With the switch and a 60/40 split, Beech Mountain would receive an extra $470,000; Blowing Rock would receive an extra $334,000; and Seven Devils would receive an extra $73,000, according to figures provided by County Finance Director Margaret Pierce. These figures are based on last year’s sales tax numbers. 

According to the 2010 Census, Boone has a population of 17,122; Blowing Rock has 1,241 residents; Beech Mountain has 320 residents; and Seven Devils has 192 residents. In all, Watauga County has roughly 51,000 citizens.

The ordeal with the sales-tax switch began shortly after the Boone Town Council approved new regulations to multi-family housing that Miller said would railroad the $19 million sale of the old Watauga High School to Templeton Properties. (Just in the past week, Phil Templeton penned a letter stating his intentions to back out of the deal once the customary inspection period ends unless the town eased certain restrictions for the property.)

In late March, Miller said the decision to move towards switching the sales tax distribution method was politically motivated in an attempt to gain leverage with the Town of Boone and have the council exclude the old high school property from any new multi-family housing regulations that were made after the board of commissioners accepted Templeton’s offer.

A week later, after High Country Press reported that the Town would potentially lose $2 million in revenue with the sales-tax change, the Town of Boone sent out a letter to its 17,000-plus residents and media outlets condemning the “threats” from Miller, addressing the regulations and issue of the sale of the old high school, and stating its stance on a possible meeting between the two governmental bodies.

The letter read, “The Town significantly amended the proposed ordinance [after Miller spoke before a public hearing with the Boone Town Council and Planning Commission in early February].”

In addition that letter quoted that the Mayor Loretta Clawson also penned a letter, which read, “The provisions do not apply to the old high school property as long as the developer provides financial assurance that the commercial portion of the project is built. It’s also important to note the Town has set aside 150,000 gallons of scarce water resources for the project … Since then, Mr. Miller has expressed to Boone Town Council members that the amended ordinance is not acceptable.  The Town has requested specifics about those concerns in regard to the old high school property, but has not received what it calls, “a satisfactory response.”

(Regarding the financial assurance, Clawson mentioned above, Templeton, in his letter, said that those financial commitments would “prove to be unattainable in today’s economic climate.”)

Soon a back and forth between the county and town ensued, airing positions in letters through the media. Clawson called the back-and-forth in the press a “circus,” where she added that the offer to enter into a mediation with the county still stands.

“Once it is determined what, if any, specific changes should be considered in our ordinance to assist in the sale, there will be a full and open public hearing for all to weigh in on any proposed solution,” Clawson wrote. 

Miller has maintained throughout the past couple months that the Town of Boone has refused to meet, on several occasions, to discuss the propositions at hand and that when the town has agreed to meet, it is under unacceptable circumstances. 

Miller said that the Town of Boone wants the commissioners to meet in closed session for discussions and mediations, which Miller called “illegal.” He also called the Boone Town Council closed session meetings to discuss the sales-tax switch and the old high school sale illegal, as well.

In March, the Boone Town Council met at least twice in closed session to discuss the situation regarding the old high school and the sales tax, according to Boone Town Council Member Andy Ball. The meeting was for the purpose to discuss the “threat of legal action to the town,” Ball said.

As for a future meeting, Miller said, “The county will only meet in public … we will act within the confines of the law.”

Ball said that the Boone Town Council is willing to meet with the Watauga County Board of Commissioners through a mediator in closed session.

The two entities, Ball said, would be in separate rooms, whereby a mediator touches base with each party and works out a deal – all in closed session, which Ball said was legal under general statutes. After a deal is agreed upon, Ball said the two parties would then go public in a forum-type setting.

As for Miller talking with officials from the other townships for the purpose of the 60-40 split, Ball is crying foul, also.

“The deal that has been struck is a clear violation of open-meeting laws. On behalf of the county, commissioners worked out a deal behind the scenes in a very, very shady way,” Ball said. “It’s extortion for them to do this to taxpayers. I am outraged.”

“Discussions from county commissioners to other elected officials of other towns discussing the idea of a hybrid solution, clearly those meetings should have been public, part of open records,” Ball continued.

Miller, defending his position, also citing general statues.

Miller readily admits that he met with one council member at Seven Devils, the mayor of Blowing Rock and another council member, and one council member with Beech Mountain to discuss the hybrid, sales-tax resolution.

“Never did I meet with three or more commissioners of any town or municipality,” Miller said. “I simply met with them and said this is what I am thinking, what are you all thinking.”

“They are crying foul, but they are clearly wrong. Andy Ball has no clue what he is talking about,” Miller added. “I am tired of being called a bully and unethical. I am doing everything within the confines of the law, and I can clearly delineate the law.” 

Commissioner John Welch said he learned about the negotiations between Miller and the other municipalities through the media.

“I am understand I am in the minority [being one of two Democrats on a five-member board,” Welch said. “But to totally block us out of all negotiations with the towns is wrong and not giving us the heads up before the negations were complete and to have me find out in the newspaper, just doesn’t make sense to me.”

He added that he felt he should have at least had a courtesy call and chance for input since his name is on the letterhead that Miller has used in the past to express his opinion during the recent letter-war between the Town of Boone and Watauga County.

In the end, he said this whole ordeal, specifically the back-and-forth between the county and the town and its inability to negotiate – or simply meet with one another – has been “ridiculous.”

“It’s been drawn out and is really embarrassing. People elected serve everybody whether it’s the town or the county or both. We just can’t come together for a simple discussion,” Welch said, adding that he would like to see more open discussions and public input. 

Both Ball and Miller said a Sunday meeting was possible. The chances look slim, though. Plus according to state law, meetings of governmental bodies require a advanced public notice of 48 hours. So if a meeting were to take place, it wouldn’t be before 3 p.m. on Sunday. 

Check out the N.C. General Statutes for yourself: 

§ 143318.10.  All official meetings of public bodies open to the public.

(a)        Except as provided in G.S. 143‑318.11, 143‑318.14A, and 143‑318.18, each official meeting of a public body shall be open to the public, and any person is entitled to attend such a meeting.

(b)        As used in this Article, “public body” means any elected or appointed authority, board, commission, committee, council, or other body of the State, or of one or more counties, cities, school administrative units, constituent institutions of The University of North Carolina, or other political subdivisions or public corporations in the State that (i) is composed of two or more members and (ii) exercises or is authorized to exercise a legislative, policy‑making, quasi‑judicial, administrative, or advisory function. In addition, “public body” means the governing board of a “public hospital” as defined in G.S. 159‑39 and the governing board of any nonprofit corporation to which a hospital facility has been sold or conveyed pursuant to G.S. 131E‑8, any subsidiary of such nonprofit corporation, and any nonprofit corporation owning the corporation to which the hospital facility has been sold or conveyed.

(c)        “Public body” does not include (i) a meeting solely among the professional staff of a public body, or (ii) the medical staff of a public hospital or the medical staff of a hospital that has been sold or conveyed pursuant to G.S. 131E‑8.

(d)       “Official meeting” means a meeting, assembly, or gathering together at any time or place or the simultaneous communication by conference telephone or other electronic means of a majority of the members of a public body for the purpose of conducting hearings, participating in deliberations, or voting upon or otherwise transacting the public business within the jurisdiction, real or apparent, of the public body. However, a social meeting or other informal assembly or gathering together of the members of a public body does not constitute an official meeting unless called or held to evade the spirit and purposes of this Article.

(e)        Every public body shall keep full and accurate minutes of all official meetings, including any closed sessions held pursuant to G.S. 143‑318.11. Such minutes may be in written form or, at the option of the public body, may be in the form of sound or video and sound recordings. When a public body meets in closed session, it shall keep a general account of the closed session so that a person not in attendance would have a reasonable understanding of what transpired. Such accounts may be a written narrative, or video or audio recordings. Such minutes and accounts shall be public records within the meaning of the Public Records Law, G.S. 132‑1 et seq.; provided, however, that minutes or an account of a closed session conducted in compliance with G.S. 143‑318.11 may be withheld from public inspection so long as public inspection would frustrate the purpose of a closed session.  (1979, c. 655, s. 1; 1985 (Reg. Sess., 1986), c. 932, s. 4; 1991, c. 694, ss. 1, 2; 1993 (Reg. Sess., 1994), c. 570, s. 1; 1995, c. 509, s. 135.2(p); 1997‑290, s. 1; 1997‑456, s. 27; 2011‑326, s. 8.)

 § 143318.11.  Closed sessions.

(a)        Permitted Purposes. – It is the policy of this State that closed sessions shall be held only when required to permit a public body to act in the public interest as permitted in this section. A public body may hold a closed session and exclude the public only when a closed session is required:

(1)        To prevent the disclosure of information that is privileged or confidential pursuant to the law of this State or of the United States, or not considered a public record within the meaning of Chapter 132 of the General Statutes.

(2)        To prevent the premature disclosure of an honorary degree, scholarship, prize, or similar award.

(3)        To consult with an attorney employed or retained by the public body in order to preserve the attorney‑client privilege between the attorney and the public body, which privilege is hereby acknowledged. General policy matters may not be discussed in a closed session and nothing herein shall be construed to permit a public body to close a meeting that otherwise would be open merely because an attorney employed or retained by the public body is a participant. The public body may consider and give instructions to an attorney concerning the handling or settlement of a claim, judicial action, mediation, arbitration, or administrative procedure. If the public body has approved or considered a settlement, other than a malpractice settlement by or on behalf of a hospital, in closed session, the terms of that settlement shall be reported to the public body and entered into its minutes as soon as possible within a reasonable time after the settlement is concluded.

(4)        To discuss matters relating to the location or expansion of industries or other businesses in the area served by the public body, including agreement on a tentative list of economic development incentives that may be offered by the public body in negotiations. The action approving the signing of an economic development contract or commitment, or the action authorizing the payment of economic development expenditures, shall be taken in an open session.

(5)        To establish, or to instruct the public body’s staff or negotiating agents concerning the position to be taken by or on behalf of the public body in negotiating (i) the price and other material terms of a contract or proposed contract for the acquisition of real property by purchase, option, exchange, or lease; or (ii) the amount of compensation and other material terms of an employment contract or proposed employment contract.

(6)        To consider the qualifications, competence, performance, character, fitness, conditions of appointment, or conditions of initial employment of an individual public officer or employee or prospective public officer or employee; or to hear or investigate a complaint, charge, or grievance by or against an individual public officer or employee. General personnel policy issues may not be considered in a closed session. A public body may not consider the qualifications, competence, performance, character, fitness, appointment, or removal of a member of the public body or another body and may not consider or fill a vacancy among its own membership except in an open meeting. Final action making an appointment or discharge or removal by a public body having final authority for the appointment or discharge or removal shall be taken in an open meeting.

(7)        To plan, conduct, or hear reports concerning investigations of alleged criminal misconduct.

(8)        To formulate plans by a local board of education relating to emergency response to incidents of school violence.

(9)        To discuss and take action regarding plans to protect public safety as it relates to existing or potential terrorist activity and to receive briefings by staff members, legal counsel, or law enforcement or emergency service officials concerning actions taken or to be taken to respond to such activity.

(b)        Repealed by Session Laws 1991, c. 694, s. 4.

(c)        Calling a Closed Session. – A public body may hold a closed session only upon a motion duly made and adopted at an open meeting. Every motion to close a meeting shall cite one or more of the permissible purposes listed in subsection (a) of this section. A motion based on subdivision (a)(1) of this section shall also state the name or citation of the law that renders the information to be discussed privileged or confidential. A motion based on subdivision (a)(3) of this section shall identify the parties in each existing lawsuit concerning which the public body expects to receive advice during the closed session.

(d)       Repealed by Session Laws 1993 (Reg. Sess., 1994), c. 570, s. 2. (1979, c. 655, s. 1; 1981, c. 831; 1985 (Reg. Sess., 1986), c. 932, s. 5; 1991, c. 694, ss. 3, 4; 1993 (Reg. Sess., 1994), c. 570, s. 2; 1995, c. 509, s. 84; 1997‑222, s. 2; 1997‑290, s. 2; 2001‑500, s. 2; 2003‑180, s. 2.)