County Tax Collectors and City Taxes

Published for Coates' Canons on April 13, 2023.

It’s increasingly common for county tax collectors to collect taxes for municipalities in their counties.  Five years ago I discussed in this blog post how interlocal agreements can authorize these arrangements.  Below, I dive a bit more deeply into the details on how such agreements should be crafted. Many thanks to the collectors who responded to my query on the Ptax listserv (to which you should subscribe if you are not already—click here).

Appointment as Municipal Tax Collector

G.S. 105-349 requires every local government that levies property taxes to appoint a tax collector. It makes no exceptions for governments that contract with other governments for tax collection services.  If a local government fails to appoint a tax collector, then technically no one has the authority to use the collection remedies available under the Machinery Act (attachment, levy, foreclosure) for that local government’s property taxes.

My informal survey via Ptax suggests that this requirement is being ignored by many (most?) municipalities that rely on their counties for property tax collection.  About 90% of the county tax collectors who responded to my query reported that they have not been appointed municipal tax collector despite being contractually obligated to collect municipal taxes.

However, a handful of county tax collectors said that the interlocal agreements between their counties and the towns specifically appointed them as municipal tax collectors through a provision like this:

The Tax Collector of the County is, by this Agreement, appointed as the Tax Collector for the Town, for same term under which they serve as County Tax Collector. This Agreement and appointment as Town Tax Collector shall apply to any subsequently appointed County Tax Collector.   All duties of the Town Tax Collector for the collection of the taxes, fees and assessments to be collected by the County, pursuant to N.C.G.S. §105-349 through 378, are transferred to the County Tax Collector, including Settlements as provided in N.C.G.S. §105-373.

Note the language referring to term of the municipal tax collector, which was not included in the sample agreements shared with me by county tax collectors.  I think the appointment as municipal tax collector must reference a term for that appointment, given that the Machinery Act requires that all local government tax collectors be appointed for specific terms during which they can be removed from office only for “good cause.”

If your interlocal agreements do not contain a similar appointment provision, I recommend you add one.  Alternatively, the county could ask the municipal board to adopt a resolution to the same effect.

Either way, the county tax collector should also take the oath required for the municipal tax collector position. G.S. 105-349(g).   That oath could be done separately for each municipality for which the collector is responsible, or it could be done once with an oath that lists the county and all of those municipalities.


If a county tax collector is also responsible for municipal taxes, their bond must cover both county and municipal taxes. G.S. 105-349(c).  The interlocal agreement should require the tax collector to obtain a separate bond to cover municipal taxes or modify the collector’s existing bond to do so.  It’s probably best for the town to cover the cost of that new or modified bond, although that issue can be negotiated between the parties.

While the Machinery Act leaves the specific amount of the bond up to the governing board, it does state that no tax collector shall be permitted to collect any taxes not covered by their bond.  I think this means that a tax collector’s bond must be large enough to cover the full tax levy for which they are responsible, including the county tax levy plus the levies for all of the municipalities for which they are responsible. That’s big money for larger counties and could make for an expensive bond.  One tax collector told me that his bond covers only the amount of cash that is reasonably expected to be handled by his office in a given day.  I’d be interested in hearing more about the bond amounts for tax collectors; please email me ( if you are willing to share the details of your bond.

Annual Order of Collection

Technically a tax collector has no authority to use enforced collections for a given tax levy unless and until they are ordered to collect those taxes under G.S. 105-321(b).  This order must happen annually for each new tax levy.  If you are collecting a municipality’s taxes, you should ask that governing board to issue an order of collection to you each spring or summer just as your board of commissioners does for county taxes.

Municipality to Mirror County Tax Resolutions

The county tax collector’s life will be much less complicated if municipal taxes are governed by the same optional collection procedures the county applies to its own taxes. Accordingly, the interlocal agreement should obligate the municipality to adopt resolutions that mirror county resolutions concerning discounts under G.S. 105-360(c), the lack of an obligation to collect minimal taxes ($5 and less) under G.S. 105-321(f), and the authority to apply overpayments of up to $15 to the following year’s taxes under G.S. 105-321(g).

Refunds & Releases

I don’t think the municipality may delegate to the county the authority to rule on requests for refunds or releases of municipal taxes. As a result, the county tax collector must obtain from the municipality’s governing board approval of any municipal property tax refund or release under G.S. 105-381 just as the collector gets approval from the board of commissioners for refunds or releases of county taxes.

Remember that a governing board may delegate authority to approve small refunds and releases (<$100) to that government’s unit’s attorney, finance officer, or manager.  But that authority cannot be delegated to officials from another unit of government.

Many tax collectors obtain after-the-fact approval for routine refunds and releases (overpayments, double listings, etc.) from their boards via the consent calendar at the next board meeting.  This approach seems low risk, but tax collectors should always get clear instructions from their boards (both county and municipal) on when and how they want to review and act on refunds and releases.

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Topics - Local and State Government