Friday, January 31, 2014

Let’s Not Make a 130 Million Dollar Recurring Mistake

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In November Pinellas County voters will be asked to approve a 1 percent hike in the local sales tax. This sales tax increase is estimated to produce 130 million dollars per year.

The new revenue will flow directly to the Pinellas Suncoast Transit Authority (PSTA).

Currently the PSTA operating budget is just under 70 million dollars. The referendum ordinanceGreenlight Pinellas Tax Ordinance, (Click to Read) allows the new sales tax revenue to flow immediately to PSTA with no controls on the use of these new funds in the Ordinance voters are being asked to approve.

There are no controls, no caps, no guidance, no adjustable rates and absolutely nothing to prevent those desperately pushing for light rail to grab the revenue flow and get it pledged to a bond issue which would render the tax captive for the life of the bonds.

The real issue with this sales tax referendum is not public transportation. Pinellas County needs and must have a robust public transportation system.

The real issue is governance.

The Pinellas County Commission after years of endless presentations by TBARTA (Tampa Bay Area Rapid Transit), HART (Hillsborough Rapid Transit Authority) and PSTA all working to together, finally bought in an Ordinance written by PSTA legal staff that essentially backs a truck full of your money up to the PSTA door dumps it there and drives off.

You have probably heard the old saw “nature abhors a vacuum.” There are no naturally occurring vacuums nature immediately fills them.

Money is government’s equivalent of nature’s vacuum.

When money shows up, Government immediately spends it. I cannot begin to tell you how many hours I spent as a public sector assistant director and manager making sure “all” the money was committed.

You can pretty well bet that the PSTA management team is already hard at work planning what they will spend the first year $60 - $70 Million dollar windfall on.

Chairman Welch and the County Commissioners will tell you since they sit on the PSTA Board the County Commission will still be in control.

Highly unlikely.

It is hard to believe they will be voting against spending money they just asked the tax payers to approve, especially since they have gone out of their way to remove the only dissenting County Commissioner from the PSTA Board.

Once this open ended, broadly drawn, fixed tax Ordinance is approved, it would take another referendum to change things, and some quick and well planned maneuvering by PSTA could totally tie the hands of any future County Commission and the voters.

The decision to vote for or against this Referendum question is not nearly as much about the fate of public transportation in Pinellas County as it is about a massive tax grab ($2.6 Billion) over 20 years, and how those funds will be managed.

It’s your money, what do you think?

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Disclosures: Contributor to
No Tax for Tracks

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