Grayson County officials weigh county assistance district to capture estimated $4 million in uncollected sales tax

Grayson County officials discussed forming a county assistance district (CAD) that would add a local sales tax in unincorporated parts of the county and could return an estimated $4,000,000 a year now being retained by the state.

The proposal, discussed at a county workshop, would require voter approval in the unincorporated areas and faces technical complications where municipal extraterritorial jurisdictions (ETJs) and existing special districts already levy local sales taxes. No formal vote was taken at the workshop.

The issue matters because county leaders said the revenue could finance county services strained by rapid residential growth, including road construction and repair, fire and emergency medical services (EMS) and public safety. Commissioners repeatedly framed the CAD as a way to shift some funding burden away from property taxes and onto consumers who purchase goods in unincorporated areas, including visitors and nonresidents.

"Low estimate is we're losing about $4,000,000 in uncollected sales tax in the unincorporated areas," the Grayson County judge said during opening remarks, describing that figure as "conservative." The judge said the county would seek to place the proposal before voters in November.

Commissioners discussed two main rate options. One option would seek the full 2 cents per dollar (described in the meeting as a 2¢ addition) countywide in unincorporated areas. Because some ETJs already carry a half-cent municipal or management district tax, the court considered a countywide 1.5-cent option and a second CAD covering only areas without existing half-cent levies so the effective rate would not exceed state limits in those ETJs. "We can't do a countywide election at 2% because we would be over that in those two areas," Commissioner Moore said, describing the Pilot Point and Gunter ETJs as examples.

Brian (staff member) explained procedural and legal constraints: if an emergency services district (ESD) or other political subdivision later sought its own sales tax, that entity would still have to hold a separate election and the two bodies would need a shared-use agreement to split revenues. "They will still need to go out for an election for the people in their ESD, and they would need to approve... unless there's a shared use agreement with the county," Brian said.

County officials identified specific allowable uses for CAD proceeds under state law as presented in the workshop: construction, maintenance and improvement of roads; law enforcement and detention services; maintenance and improvement of libraries, museums, parks and recreational facilities; public welfare and firefighting; and promotion of economic development and tourism. "It does have about five items that we can expend spend this money on, so it is limited," Commissioner Moore said, listing those categories and noting the county's priorities were roads and public safety.

Several commissioners described how new subdivisions and commercial development in unincorporated areas — including projections of a development of roughly 1,700 homes — will increase wear on county roads and demand for EMS. Commissioners said sales tax on construction materials and retail activity tied to growth would expand the county's revenue base if collected locally. "All the subdivisions that are being built in the unincorporated areas... there would be sales tax on that concrete," the judge said, adding that the county could apply proceeds to roads and fire/EMS and then use reserves to lower property tax rates over time.

Officials also discussed administrative and mapping tasks needed before placing the proposal on the ballot, including identifying precise ETJ boundaries and county appraisal district geocodes that determine where sales tax should be credited. A staff directive to clarify those jurisdictional boundaries and the practical mechanics of the ballot was discussed but no formal direction with a deadline was adopted.

Several commissioners and staff argued for a 1.5-cent countywide option as simpler to administer and less susceptible to daily ETJ boundary changes. "For simplicity's sakes, I believe the 1.5% sales tax would probably be the best way to go," one commissioner said, urging the court to avoid repeated elections tied to boundary shifts.

Workshop participants noted that out-of-state and online vendors sometimes report sales tax by ZIP code, which can misdirect local shares to cities until the comptroller's office audits and reallocates revenue. County staff said the state comptroller enforces correct remittance when vendors are audited.

The workshop concluded without a motion; commissioners said the conversation would feed a future agenda item to place a CAD election before unincorporated-county voters. "So that'll be probably coming to an agenda near you soon," the judge said before adjourning the workshop at 11:34 a.m.

Ending: County officials said voters in unincorporated Grayson County would ultimately decide whether to create the CAD and set the local tax rate; the court did not place the measure on a ballot at the workshop.