Repeal the transfer tax

From N.C. Sen. David Hoyle, D-Gaston:

I have been a long-time opponent of this so-called “home tax.” I believe that it is important to explain why it's an example of bad public policy and also explain how it was included in the overall budget last year and never received a fair vote.

As the Observer noted, last week the Senate voted overwhelmingly (by a 38-6 margin) for my legislation to repeal the land transfer tax option. While North Carolina's economy is doing better than a lot of other states, we are not immune from the economic downturn. In no area is this more evident than in the housing market.

Homeowners throughout our state are suffering and we are working hard to address their needs. I strongly supported a budget this year that works to stabilize the housing market and help protect homeowners from foreclosure.

I also know that we must remove any threat to home equity. That's why we must repeal the land transfer tax option. This continued threat of a land transfer tax could adversely affect homes sales and result in less money for counties because property taxes are their main source of revenue to build schools and fund other critical needs.

Last year, my colleagues and I were working hard to take the Medicaid burden off counties. We were trying to free up more money for counties to spend on school construction and address the rapid growth in our state. The Senate made a commitment to a permanent solution and we kept our word – and all counties benefited. By taking over Medicaid and a portion of the county's sales tax, we removed this burden and made sure that counties would benefit from it by up to $500,000 a year for three years. This was an incredibly complex issue, but we did the right thing.

The leadership of the House had other ideas about ways for counties to raise revenue. Their number one priority was the land transfer tax option. They made it clear that there would be no final budget agreement (and no Medicaid relief for counties) without including this tax option in our state budget. My Senate colleagues and I were faced with a difficult and unfair choice: oppose the whole budget, which funds everything from our schools and universities to roads and prisons, or go along with the House and vote for a budget including this tax. Our other option was to shut down the government.

The Senate passed Medicaid relief as a separate bill to keep it out of the budget negotiations, but to no avail. I made the tough call and I stand by it.

Since then, voters in 20 counties have had the chance to vote on the land transfer tax. All 20 counties have soundly rejected it, some by percentages higher than 90 percent.

The voters have spoken and we heard them loud and clear. I call on the House to follow our lead and repeal this unpopular and unfair threat to homeowners. The Senate held a clean up-or-down vote. I urge the House to do the same.