Brunswick County will pay more than $113,000 to the state of North Carolina for selling gas from county pumps to some nonprofits without following a required process to account for state fuel taxes.
More than $60,000 will be refundable under state law, but the county likely will eat about $7,300 in interest payments and more than $50,000 in fuel tax because it did not follow the rules for the last three years.
A system that allowed the nonprofits to fuel official vehicles at county-owned pumps, was stopped on Dec. 31. It had been in effect for more than three years, but tax laws provide for recovery of unpaid taxes only for the previous three years.
The county expects to go through the same process for unaccounted federal fuel taxes in the same period, county attorney Huey Marshall said, but the federal fuel tax is only about one-third of the state tax, meaning that the refundable payments and interest should be significantly less than the state tally.
The county is not required to pay fuel tax on what is used for county vehicles.
Ann Hardy, Brunswick finance chief, said the law allows fuel tax refunds to volunteer fire and rescue squads and shelter workshops. Hardy wasn't sure what would be eligible under the shelter workshops exemptions, but it likely doesn't include Brunswick Senior Resources and Brunswick Transit Agency, which racked up $51,752 of unpaid fuel tax combined.
Both agencies used the county pumps - Brunswick Transit accounted for $47,073 and the rest was attributed to Brunswick Senior Resources. Community Development Corporation, also likely not refundable, had $598.33 in unpaid taxes, according to a list of agencies discussed during Monday's Brunswick County Commission meeting.
All will be billed by the county for the back taxes, but Bill Sue, Brunswick commissioners chairman, said the county may end up paying the bill for Brunswick Transit and Brunswick Senior Resources. Both are funded primarily through the county and state, he said, and don't have the money to pay the back tax.
The remainder of unpaid fuel taxes was for fuel purchased by volunteer fire and rescue squads throughout the county. The county learned of the error when it switched fuel wholesalers last year, county officials said.
At the time, it had four sites in the county where the fuel could be obtained by the nonprofits. Now, Marshall said, all the sites have been closed except the one at the county government complex in Bolivia where county vehicles get fuel.