Dodging a Bullet – No Sales Tax Referendum
In a 4-3 vote, the County Commission yesterday rejected a staff proposal to place a half penny “infrastructure” sales tax on the November ballot.
Criticism of the proposal, from TAB, the Economic Council and others pointed out the “grab bag” nature of the projects, the size of the increase ($110M) in relation to the current budget for Engineering and Public Works ($55M), ballot competition with the School System and the Children’s Services Council re-authorization, and the multi-year decision by the Commission to defer road and bridge maintenance in favor of other priorities.
In December, four of the Commissioners voted to proceed with the referendum and asked staff to bring back a more complete proposal. This time, Jess Santamaria changed his mind after hearing input from the public, and joined Steven Abrams, Paulette Burdick and Hal Valeche to kill the measure.
Shelley Vana, who complained about the state of roads in her district, declared “there is no free lunch” and wanted the “people to decide”. Mary Lou Berger, who sees a public safety issue in deteriorating roads, wanted to proceed with the option of re-thinking it in July. Mayor Priscilla Taylor, who considers the sales tax hike an “investment”, declared that our voters are smart enough to decide for themselves and we shouldn’t worry about what other taxing districts are doing.
Hal Valeche thinks that road and bridge maintenance should be prioritized in the normal budget cycle, and Paulette Burdick didn’t think the public would see this as higher priority than the School’s needs or the CSC. Steven Abrams thought it was a “tax in search of a topic” and captured the situation clearly when he said he couldn’t see people standing on the sidewalk with signs saying “Vote for Drainage, Vote for Road Repair.”
As this is the third try since 2012, we can’t be sure it will not come back, but for now it looks like the proposal is dead for 2014.
Thanks to those who spoke against the measure, including Alex Larson, Anne Kuhl, Daniel Martel of the Economic Council, Realtor Christina Pearce, and Fred Scheibl of TAB. There were no speakers in favor of the referendum.
For the Palm Beach Post Story, see County rejects sales tax ballot bid
Another Go at the Sales Tax on Tuesday
The proposal for a county sales tax increase is back on the agenda, Tuesday March 11, postponed from the December 17 meeting by a 4-3 vote. (See Item 5G1.)
In December, there was consensus that the proposal was a “potpourri” or grab-bag of small projects lumped togther to utilize the $110M a year that a .5% increase would bring. It’s reincarnation is still a grab-bag of small projects, but they are limited to infrastructure and spending for Parks and Recreation was removed. Since the total hasn’t changed, the net effect is to add MORE road projects to the proposal. The largest of these is a line item for “resurfacing – 7 years @ $12M/year” for $84M.
A noteworthy aspect of this proposal coming out of George Webb’s Engineering and Public Works Department, is the condition that 40% ($44M per year) is to be shared with the municipalities for wherever they would like to spend it. However allocated, this would represent a sizeable amount relative to most city, town and village budgets. (Note- this sharing is required by the authorizing statute for sales tax surcharges).
As for Engineering and Public Works itself, the $66M / year retained in this proposal would more than double their $53M current budget.
It should be said that road projects have gotten more of their share of cuts over the last few budget cycles, as the enormous half a $Billion (with a “B”) Sheriff’s budget gobbles up an ever larger percentage of the county tax revenues. Adding $66M to E&PW from a different revenue source would seem to be a questionable action.
The December proposal was allocated differently – $44M for the School District, $40M for the county (including Parks and Recreation), and $26M for the municipalities. The school district did not want to play in this though – rumor has it that a separate sales tax increase will be brought forward by those folks. In the revamped proposal, E&PW decided to just keep all the money for themselves.
This proposal should be considered within the overall background of county finances, not in isolation. Property Appraiser Gary Nikolits is projecting a 6-7% increase in taxable valuations this year. Even with some reduction in millage (which we think is justified), there should be sufficient property tax revenue to start addressing infrastructure maintenance that has been deferred over the last few years. When you build a road, you should plan to maintain it – this is one of the natural and expected functions of government. That spending was diverted to other priorities is a management failing – not a justification for a new tax.
A serious proposal for a sales tax hike could be justified if it was revenue neutral – ie. offset the $110M in new revenue with an equal reduction in ad-valorem tax. That is not what is being proposed. Instead, it is still George Webb’s “wish list” of work he’d like to do but was unable to justify in the normal budget process.
If this were actually to get on the ballot in November, particularly next to a School System increase (“it’s for the children!”) and the re-authorization of the taxing district for the Children’s Services Council (“It’s also for the children!”), then a betting man would wager that it will go down in flames. Perhaps they all will, as the taxpayers do not sense that their money is spent wisely today.