The North Carolina Senate unveiled a new proposal this week for changes to the local sales tax redistribution formula across the state—a proposal that could affect rural economies and possibly rural education.

Rep. Paul Tine, who represents part of Beaufort County in the N.C. General Assembly, said that right now 75 percent of the local sales tax revenue is distributed based on the point of sale, meaning the revenue stays in the county where the sale has occurred. The other 25 percent is distributed based on the populations of other counties, also known as a per-capita distribution.

The original House Bill 117 wanted to base 80 percent of the local sales tax redistribution on county populations with the other 20 percent remaining at the point of sale, but now the Senate has changed the proposal to 50-50, Tine said.

“They say the reason is that they can invest in rural communities,” he said. “Some counties who are asking for the funds say they will use it toward education.”

Beaufort County usually dedicates a portion of its sales tax revenue to the public school system, and this year is no different.

Mark Newsome, chief financial officer for Beaufort County, said the county’s two largest unrestricted revenue funds are from property and sales taxes. He said the county is expected to get a total of $7,884,266 in sales tax revenue this fiscal year.

“The split between the two is approximately 80/20,” Newsome said in an email. “I believe it would then be reasonable to use that split to describe the amount of sales tax revenue that went to the school system. The school system’s funding for the current year is $15,033,163. Twenty percent would be approximately $3,006,633.”

The Senate’s new bill comes after the legislature received protests from wealthier urban counties who would stand to lose from the 80 percent per-capita based changes as well as lawmakers against the plan for wealth redistribution.

“We need to be doing some (rural) investment,” Tine said. “We continue to struggle with our employment numbers and economic growth.”

Because of Beaufort County’s status as a Tier 1 county, it stands to benefit from the redistribution to a more per-capita based system. Under the original bill, the county would have gained about $45,000 more in local sales tax revenue for the fiscal year 2015-2016.

But despite the possible gains Beaufort County could receive under the Senate’s 50-50 proposal, Tine said he thinks the legislature is trying to go about investing in rural counties in the wrong way. He said he thinks the extra revenue should come from the state, rather than from local sales taxes from other counties.

Tine said he thinks hurting counties on the local level would end up backfiring and causing problems.

“I would vote no because, again, it’s the wrong plan,” he said. “You don’t do it by taking from one neighbor and giving to another.”

“You don’t take it from one county and give it to another county.”