RALEIGH — A local legislator wants the state to shift gears on a plan to have the N.C. Division of Motor Vehicles bill citizens for property taxes owed on vehicles along with annual license tag fees.
Rep. Sarah Stevens said while this might sound good on the surface in ensuring that taxes are paid, it will present extra costs to county governments due to fees that are included.
In the case of Surry, Stevens’ home county, total billing costs for vehicles would rise from $25,000 to $80,000, according to figures she provided earlier this week when discussing the DMV Tag and Tax Together program.
Beginning with registration-renewal notices mailed in May for bills due in July, vehicle owners will receive combined statements not only for the cost of new license stickers but also the county taxes owed for the same cars or trucks.
“They wanted to make it easier,” Stevens said of the taxation process, given that 13 percent of motor vehicle property taxes go unpaid annually. The Tag and Tax Together program ensures that an owner can’t renew a tag without paying the taxes.
A registration-block mechanism has been in place for years in the state, but sometimes fails to provide such a tax-collection guarantee since it must be activated by counties. “It doesn’t always work,” Stevens said.
However, Stevens, a Republican House member, said that under Tag and Tax Together, counties would be charged a fee of $2.05 for each license-renewal/tax bill processed by the state agency. When credit cards are used, the handling fee will jump to $6.13 per transaction, she said.
When applied to large numbers of vehicles, a major expense will be posed to localities, Stevens said. She cited figures showing that Surry County now spends $120,000 for all property tax billing, but under the change it faces the $80,000 cost for motor vehicles alone.
Initially, Stevens sought to derail the plan by filing House Bill 30 on Jan. 30, aiming at repealing Tag and Tax Together.
However, in view of the cost the state already has spent to combine the process of property tax billing and license renewal, Stevens said she identified an alternate way to accomplish the same purpose.
Her plan, which is now in the draft stage, would have counties process the tag renewal and property taxation rather than the DMV.
The local cost under that plan would be 60 cents per transaction, according to the representative.
“Counties would still collect 100 percent of what’s due and we would get a lot of bureaucracy out of the way,” said Stevens, who is trying to build support for localities being the billing agents.
“I hope counties will get on board (with the plan) because it is more sensible for them.”
Reach Tom Joyce at 719-1924 or email@example.com.