Sales Tax Referendum Gathering Steam

The county commission will vote Tuesday whether to ask the voters to raise the county sales tax from 6% to 7%. (Agenda Item 5B1)

After aborted attempts in 2012 and 2014, when a majority of the board thought the proposal was “half baked” and the need not urgent enough to convince the voters to cough up several billion over ten years, this time no one will say that the proposal hasn’t been finely tuned.

To her credit, County Administrator Verdenia Baker has put enormous energy and thought into lining up partners and getting potential opponents on board. She has made countless trips to the District, the League of Cities, business groups, city and town governments, and even homeowners associations to solicit ideas and sell the concept.

The School District has bought in, voting to partner up and accept just 48% of the take – less than they would have received with a go-it-alone half cent increase “for the children”.

The cities have also rallied to grab a piece of the potential windfall, producing a detailed wish list of projects to absorb their 18.5% – many of which would never have been conceived under their own municipal budgets.

And the master stroke was to bring in the Cultural Council as the tip of the spear. Acting in a capacity that can be looked at as “fee for service”, the Cultural Council is the hired gun whose “One County, One Plan, One Penny” campaign is already cranking up. The School District and the County Government are prohibited by law from engaging in political campaigning to pass a measure favorable to them, but the Public/Private Cultural Council is under no such restraint. Their 4.5% of the proceeds (about $122M over 10 years) is payment rendered to convince the public that this tax increase is to their benefit.

If it passes, the county will receive 28.5% of the proceeds, and although it is an “infrastructure surtax”, intended for maintenance of roads, bridges and facilities, much of the money is earmarked for new capital projects. It even contains a $27M “Economic Development Fund” for unspecified projects “to attract, retain, and expand businesses to improve the local economy.”

We think this a bad direction for the county, but there is enough muscle behind the proposal, that keeping it off the ballot would seem unlikely at this point. Only one Commissioner has signaled his opposition (Hal Valeche, to his credit), and the usual folks who oppose tax increases – such as the Economic Council, the Palm Beach Post editorial board, even some TAB partners, are either supporting the proposal or remaining neutral.

If you would like to go on record as opposing this referendum, send an email to the BCC or speak at the meeting on Tuesday.

Here are some things to keep in mind:

  • It is a net tax increase of $220M per year – there is no talk of reducing ad-valorem taxes
  • It is not subject to the scrutiny applied to items in the annual ad-valorem budget
  • It creates an incentive to make purchases outside the county (both Broward and Martin are at 6%)
  • It is regressive
  • It is not an “infrastructure maintenance” tax, but includes many new capital projects