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North CarolinaHB 3052025-2026 SessionHouseWALLET

AN ACT TO PROMOTE FAIRNESS IN SALES TAX DISTRIBUTIONS FOR MUNICIPALITIES IN GUILFORD COUNTY BY ALLOWING MUNICIPALITIES THAT DO NOT LEVY AD VALOREM TAXES TO RECEIVE A PERCENTAGE OF LOCAL GOVERNMENT SALES AND USE TAX DISTRIBUTIONS.

Sponsored By: John M. Blust (Republican)

Became Law

COMMERCECOUNTIESLOCALLOCAL GOVERNMENTMUNICIPALITIESRATIFIEDRETAILINGTAXATIONTAXES, SALES & USEGUILFORD COUNTYCHAPTEREDTAX DISTRIBUTION

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Bill Overview

Analyzed Economic Effects

3 provisions identified: 2 benefits, 0 costs, 1 mixed.

How new county tax is spent

Each year, Guilford County must use Article 46 sales tax money in this order: the larger of 20% or $5 million for fire and rescue capital, then the larger of 10% or $2.5 million for Guilford Technical Community College capital, and the rest for classroom teacher salary supplements. These dollars must add to, not replace, existing funds and keep at least the 10‑year average support. The State sets the annual set‑asides using last year’s totals and pays them monthly; after the set‑asides, it pays qualifying towns’ shares and then the county the remainder. Qualifying towns may spend their shares on any public purpose. Summerfield must first send its shares to the Summerfield Fire District until the total reaches $3,000,000 for water‑related fire protection capital; after that, Summerfield may use its shares for any public purpose. These rules take effect July 31, 2025.

Sales tax shares for certain towns

The law lets certain Guilford County towns that do not levy a property tax, and do not already get ad valorem distributions, receive a share of local sales tax. A town’s share equals 25% of what the per‑person method would pay, minus its property‑based distribution. If the result is above $0, the State pays it. The Secretary of Revenue first sets the county’s allocation, pays these town shares from it, then splits the rest among the county and other towns, and also shows what each taxing district would have received without these payments. A town must pass and send a resolution to start; in 2025 it is due by October 1, and in later years it must be adopted in April. Payments begin in the fiscal year after the next one. Payments stop if the town starts a property tax, or two fiscal years after the county switches to the per‑person method. Property taxes by a service or fire district inside the town do not end eligibility, and taxing districts in Guilford County or Greensboro are held harmless. This special town‑share system pauses once the county begins collecting the voter‑approved 0.25% Article 46 tax, and restarts if the county later repeals that tax. These rules take effect July 31, 2025.

Sales tax only with voter OK

Beginning July 31, 2025, Guilford County can add a 0.25% local sales tax only if voters approve it in a referendum. After a majority yes vote, the Board may levy the tax by resolution with at least 10 days’ public notice. The ballot must say the money is for teacher salary supplements, fire protection equipment and services, Guilford Technical Community College, and municipal public purposes. This rule applies to referendums held on or after July 31, 2025, even if the Board’s resolution was passed before, on, or after that date. If voters approve, shoppers in the county pay the extra 0.25% on taxable purchases.

Sponsors & Cosponsors

Sponsor

  • John M. Blust

    Republican • House

Cosponsors

  • Jerry "Alan" Branson

    Republican • House

Roll Call Votes

All Roll Calls

Yes: 570 • No: 194

House vote • 7/30/2025

HB 305: Guilford County Sales Tax Distribution Modifications.

Yes: 93 • No: 21 • Other: 3

House vote • 7/29/2025

HB 305: Guilford County Sales Tax Distribution Modifications.

Yes: 95 • No: 20 • Other: 4

Senate vote • 6/26/2025

HB 305: Guilford County Sales Tax Distribution Mods.

Yes: 42 • No: 0 • Other: 8

Senate vote • 6/25/2025

HB 305: Guilford County Sales Tax Distribution Mods.

Yes: 46 • No: 0 • Other: 4

House vote • 6/17/2025

HB 305: Guilford County Sales Tax Distribution Mods.

Yes: 67 • No: 46 • Other: 6

House vote • 6/17/2025

HB 305: Guilford County Sales Tax Distribution Mods.

Yes: 105 • No: 8 • Other: 6

House vote • 5/7/2025

HB 305: Guilford County Sales Tax Distribution Modifications.

Yes: 54 • No: 57 • Other: 8

House vote • 5/7/2025

HB 305: Guilford County Sales Tax Distribution Modifications.

Yes: 68 • No: 42 • Other: 7

Actions Timeline

  1. Ch. SL 2025-87

    7/31/2025House

  2. Ratified

    7/31/2025House

  3. Ordered Enrolled

    7/30/2025House

  4. Concurred On 3rd Reading

    7/30/2025House

  5. Concurred On 2nd Reading

    7/29/2025House

  6. Placed On Cal For 07/29/2025

    7/3/2025House

  7. Withdrawn From Cal

    7/3/2025House

  8. Placed On Cal For 07/15/2025

    6/30/2025House

  9. Withdrawn From Com

    6/30/2025House

  10. Re-ref Com On Rules, Calendar, and Operations of the House

    6/26/2025House

  11. Ruled Material

    6/26/2025House

  12. Special Message Received For Concurrence in S Com Sub

    6/26/2025House

  13. Special Message Sent To House

    6/26/2025Senate

  14. Passed 3rd Reading

    6/26/2025Senate

  15. Passed 2nd Reading

    6/25/2025Senate

  16. Placed on Today's Calendar

    6/25/2025Senate

  17. Reptd Fav

    6/25/2025Senate

  18. Re-ref Com On Rules and Operations of the Senate

    6/23/2025Senate

  19. Com Substitute Adopted

    6/23/2025Senate

  20. Reptd Fav Com Substitute

    6/23/2025Senate

  21. Re-ref to Finance. If fav, re-ref to Rules and Operations of the Senate

    6/20/2025Senate

  22. Withdrawn From Com

    6/20/2025Senate

  23. Ref To Com On Rules and Operations of the Senate

    6/18/2025Senate

  24. Passed 1st Reading

    6/18/2025Senate

  25. Special Message Received From House

    6/18/2025Senate

Bill Text

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