Tavares, FL - Sunday, feb. 16, 2014
For almost 15 years, the County Govt., the cities, and the School District received equal thirds of revenues from a Penny Sales Tax approved by voters.
That tax is due for a public renewal vote in 2015, and the School Board is talking about instead launching a referendum for a different, and additional 1/2 penny tax just for their capital spending needs.
But the County government leaders and League of Cities would rather stay with just renewing the existing tax and percentage splits because they are fearful the public won't support a renewal of the tax if the schools go for a separate, new sales tax.
This story by Livi Stanford in today's Daily Commercial (see link below) provides all the details, so read it to get an idea of what could happen - either all three tax entities join together to renew the existing tax, or the School Board independently tries to get voter approval of their own half penny tax, which leaves the County & Cities to campaign for voters to also approve renewal of the existing penny tax which would be split only between the County & the cities.
My Opinion:
Currently my opinion is that renewal of the existing penny sales tax with the existing 33% split among County, Cities & Schools is justified to maintain the status quo, but voters should ask for specific reports on where the money went in the last 15 years (which projects and how much was for projects vs bond interest etc), AND they should ask for a list of specific projects to be completed using the future tax revenues.
Additionally, if the Schools decide to go for the separate, and additional 1/2 penny tax, then success for voter approval (in 2015, not this year) of both taxes is up in the air. There is no doubt the Schools are running short of capital funding revenues, but that is partly because they and the County waived impact fees. Who knows if the Schools will get the added tax, and the County & Cities will get enough public support for the one penny tax renewal? One or both requests could be shot down by voters.
Here is the link to the full Daily Commercial story, followed by the text in case they turn off the links later. The PRINT version includes a good table showing the past uses of the existing "penny" sales tax, which is why we always recommend subscribing to the print version of the Daily Commercial.
http://www.dailycommercial.com/news/article_4251f64c-0b4a-5338-ba00-43002693280f.html
Penny sales tax a contentious issue
Livi Stanford | Staff Writer [email protected] | Posted: Sunday, February 16, 2014 6:00 am
Over the last 10 years, many projects have come to fruition in Lake County, from the construction of the new Emergency Operations and Communications Center, to the manufacturer of the new Clermont Community Center, to the rebuilding and modernization of Tavares High School.
Shows how far a penny will go.
These projects are all examples of how revenue from the one-cent sales tax for infrastructure is spent. It added up to a total of $34.8 million in total revenue last year that was divided between the cities, school district and the county — with each receiving a third of the allocation. The 14 cities then must divide up their allocation proportionally.
As the tax is set to sunset, or expire, in 2017, county officials said this week at a board workshop they would like residents to have the opportunity to vote on whether to renew the tax in 2015.
However, there is some contention about how the tax revenue should be divided, with some school board members suggesting that half a cent be allocated for the schools, as the student population is expected to increase by 2020, and there is need for additional schools to be built.
County commissioners want to keep the status quo and agreed in consensus this week to formally vote on drafting a letter to the school board and the cities, asking them to support this. The matter will be discussed and voted upon at a future commission meeting.
Commission Chairman Jimmy Conner has stated previously that if the sales tax is not renewed, there would be no option other than to raise property taxes to pay for needed capital improvement projects.
“We use it to buy ambulances, patrol cars and for parks,” Conner said of the revenue. “It is really an important quality of life issue.”
Commissioner Timothy Sullivan, who serves as a liaison to the Lake County League of Cities, said the cities, school and county, have a need “to see these dollars continue so it doesn’t have an impact on property taxes.”
“The benefit of the one-cent sales tax is it spreads the load not only among residents, but anyone that does business in Lake County,” he said. “Property taxes hurt the people you are trying to protect the most; while the sales tax is based on people who spend money and it doesn’t include food or medicines.”
school district
Harry Fix, director of the Growth Planning Department for Lake County Schools, said previously that penny sales tax money has been spent on rebuilding and modernizing several of the county’s high schools, including Eustis High School and Umatilla High School.
As the school district looks at its future needs, Fix said several schools, such as Beverly Shores Elementary School, Oak Park Middle School and Treadway Elementary may need to be modernized or rebuilt.
Further, a consultant for the school district in November 2013 projected that by 2020, there will be an increase of about 2,297 new students in the schools, particularly in the southern part of the county. As a result, school officials see the need to build two new schools there within seven years.
In the last five years, the school district has lost more than $67 million in capital property tax revenue because the stagnant economy has kept property values low, and the Florida Legislature has cut the maximum allowable millage for capital purposes from 2 mills to 1.5 mills.
School board members Tod Howard, Bill Mathias and Debbie Stivender agree the district needs additional funding from the sales tax.
“We need about a half cent to do the repairs and replacements to the older schools,” Howard said.
While acknowledging there is no doubt more funding is needed, Stivender, chairwoman of the school board, said a request for a bigger share of the sales tax money won’t be favorably received.
“I don’t think the municipalities and the county are going to be extremely happy with that idea,” she said.
Stivender suggested a general obligation bond as a possible alternative.
Meanwhile, Mathias suggested working together with the municipalities and county to rotate every five years the half-cent share option.
“The first five years we could give the county the half cent, the next five years the school district, and the last five years it goes to the municipalities,” he said.
School board officials have not yet determined specifically how the sales tax revenue will be spent in the future.
County Commissioner Sean Parks said while he recognized the school board’s needs, it is also equally important they work together on the issue.
county
This past fiscal year, the county spent its portion of the penny sales tax revenue on projects such as the EOC, Judical Center expansion and the planned historic courthouse renovation.
About half of the county’s portion is also spent on road reconstruction, resurfacing and sidewalks, which received the smallest part of revenue. Spending for public safety and equipment also factors into the county’s portion of the money.
Parks said the renewal of the penny sales tax is vital.
“We need the current configuration,” referring to each party receiving a third. “Our population has grown 80,000 to 100,000 people and we have an increasing level of service needs.”
At the budget workshop, Conner expressed concerns about the school district as a partner in receiving sales tax revenue.
“My concern is if you include the school board, it (a renewal of the tax) won’t pass, based on all the problems they have,” he said referring to six principals who inaccurately reported their class sizes to the state, leading Superintendent Susan Moxley to call for an independent review of all schools in the district. “Then again, if you don’t include them, it may not pass.”
Commissioner Welton Cadwell also believes a renewal won’t pass unless the school district receives some of the revenue.
While the county commission has not determined specifically how their portion will be spent, they agreed public safety, quality of life projects — such as parks and sidewalks — and roads are top spending priorities.
“I want to say, to me, the biggest issue facing us over the next three years is this sales tax,” Conner said. “I know everybody likes sidewalks and parks, but should you put ambulances in service 12 hours instead of 24 hours” there would be quite the outrage.
cities
Jim Myers, executive director of the Lake County League of Cities and finance director for the city of Eustis, said the penny sales tax is vital for meeting cities’ capital project needs.
“In Eustis, it means $1.4 million in capital projects and infrastructure in Eustis annually,” he said. “We are able to utilize that money each year.”
Without that funding source, Myers said the city may have to resort to property tax increases.
Funding from the penny sales tax in Eustis has gone toward projects such as the downtown streetscape project, which renovated the sidewalks and changed several streets to two-way streets, Myers said.
“We also finished a $6 million stormwater project” with the revenue, he added.
While no decision has been made from the cities on the sales tax renewal, Myers said he anticipates discussion will begin on the issue in the fall .
“I can’t speak for all the cites, but I would be hard pressed to believe any of those cities would not want it to be renewed again,” he said.
Keith Mullins, chairman of the Sales Surtax Oversight Committee, which includes two members each appointed by the county, school board, League of Cities, as well as the representation of two constitutional officers, said the tax was last renewed in 2001.
Prior to that, the Clermont city council member said the local option sales tax was divided solely between the county and the cities, with the county receiving 70 percent and the cities 30 percent.
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