STATE ERROR SENDS SCHOOL MONEY TO LAW ENFORCEMENT

Funds Came From Drug Tax

State officials gave 375 law enforcement agencies, including the
Wilmington Police Department and New Hanover, Brunswick and Pender
County sheriff's offices, $2.4 million that should have gone to
schools from North Carolina's tax on illegal drugs.

And now the state legislature wants the money back that the N.C.
Department of Revenue paid out between July 1 and Dec. 31, 2005.

But law enforcement agencies don't have to cut checks for the amount
they were overpaid.

Instead, the revenue department will pay the money back out of its own pocket.

To recoup those costs, the revenue department will withhold money
from future payments to law enforcement agencies until 2009.

"If we are deemed that we have been overfunded ... we're going to do
what we need to do to make it right," said Brunswick County Sheriff
Ronald Hewett, who is president of the N.C. Sheriffs' Association.

The association, the governor's office and the revenue department
had asked law enforcement agencies not to make law enforcement
agencies repay the costs.

But legislators disagreed.

"For many agencies, this is money that's been expended," said Eddie
Caldwell, the association's executive vice president and general
counsel. "So this way, if it's held out from future payments, at
least they won't have to come up with the cash immediately."

N.C. Revenue Department spokeswoman Kim Brooks said the error was an
oversight because the department was uncertain about a 2005 ruling
by the state Supreme Court on whether fines went to schools.

"I guess that's basically what that was - an error or oversight by
the department," Brooks said. "It's something that happened, and
it's something that we're going to correct."

The ruling said penalties on the drug tax should be paid to schools,
and the tax and interest could be divided with the state and law
enforcement agencies.

The largest overpayment was $342,000 to the Charlotte-Mecklenburg
police and the smallest was 13 cents to the Andrews department. In
Southeastern North Carolina, the Wilmington Police Department
received $9,279; the Brunswick County Sheriff's Office received
$23,075; the New Hanover County Sheriff's Office received $21,039;
and the Pender County Sheriff's Office received $10,466.

The University of North Carolina Wilmington Police received $16.88.

Drugs, moonshine and other illegal substances taken during
investigations are taxed.

Police frequently take property such as real estate and vehicles to
pay the tax.

Staff writer Veronica Gonzalez contributed to this report from the
Associated Press.