Fiscal effects of local option sales taxes on school facilities funding: The case of North Carolina

Wen Wang, Zhirong J Zhao

Research output: Contribution to journalArticle

2 Scopus citations

Abstract

Since the 1970s, the North Carolina Legislature has authorized its counties to levy four local option sales taxes (LOST). Proceeds from two of them are partially restricted for school capital needs; two other LOST are used to augment counties' general revenues that may also affect school capital funding. Experiences from other states have raised concerns that the adoption of LOST may increase inequality in school finance, but the empirical results have been mixed. Using a data set of one hundred North Carolina county school districts from 2004 to 2006, this study examines how public school facilities are funded, and investigates whether the adoption of LOST aggravates or alleviates inequality in public school capital revenues in the state.

Original languageEnglish (US)
Pages (from-to)507-533
Number of pages27
JournalJournal of Public Budgeting, Accounting and Financial Management
Volume23
Issue number4
DOIs
StatePublished - Jan 1 2011

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