How the Greenlight Pinellas transit plan would affect your wallet

The transit sales tax plan's effect depends on your PSTA property tax.
If approved on Nov. 4, the Greenlight Pinellas transit plan would increase the county sales tax by a penny, to 8 cents on the dollar. The Pinellas Suncoast Transit Authority's existing property tax levy would be eliminated. [LARA CERRI | Times]
If approved on Nov. 4, the Greenlight Pinellas transit plan would increase the county sales tax by a penny, to 8 cents on the dollar. The Pinellas Suncoast Transit Authority's existing property tax levy would be eliminated. [LARA CERRI | Times]

ST. PETERSBURG — Supporters of the Greenlight Pinellas transit plan promise the expanded bus service and light rail system between St. Petersburg and Clearwater would transform the county and the region.

For plenty of voters, though, the decision will come down to one question: How much is it going to cost me?

The answer: It depends.

If approved on Nov. 4, the plan would increase the county sales tax by a penny, to 8 cents on the dollar. The Pinellas Suncoast Transit Authority's existing property tax levy would be eliminated.

That would translate to $130 million in annual revenue and varying affects on the wallets of residents, from the owner of a $50,000 mobile home in Lealman to a $1 million mansion in East Lake. The impact also would vary for businesses.

Opponents say the regressive tax would hurt the poor, especially renters and others who don't own property and would not benefit from the offset in property taxes.

Supporters say a sales tax is a more equitable way to fund transit. They note that about a third of the revenue would come from visitors to the county. They argue that lower income residents, second-shift workers and night school students — many of whom can't afford a car — would benefit from a beefed up transit system that runs at night and on weekends.

How much will it cost?

To gauge the potential impact on a typical homeowner, consider a property at the county's median home value of $161,600, according to the census figures. The transit tax for that property is $81.52.

Whether a property owner would see a net savings or loss if the sales tax replaces the property tax depends largely on that owner's spending habits.

Using the IRS sales tax deduction calculator, PSTA concluded that a family with the county's median income of $46,000 would pay about $800 in sales taxes annually at the new 8 percent rate, about $104 more per year. That means a household with a median income and a median home value would pay $31 more per year, or about $2.58 per month.

Generally, Greenlight supporters say, homeowners with a taxable value of $140,000 would break even, and owners of more expensive properties and moderate spending habits would save money.

Many renters and owners with low-value properties would pay more, however, because the higher sales tax won't be offset by property tax savings. A family at the median income who lives in a rental home would pay about $104 more per year.

According to Pinellas County Property Appraiser Pam Dubov, there are currently about 11,000 homestead properties in Pinellas with no taxable value because they have exemptions greater or equal to their value. That means they currently pay no property tax to PSTA.

Using the same formula above, a family of four hovering near the poverty line of $23,850 and living in a rental home could pay as much as $72 per year, or $6 a month, in additional sales tax

With a regressive tax, "the people who do the best are the very best off," said Matt Gardner, executive director of the nonprofit, nonpartisan Institute on Taxation and Economic Policy in Washington.

"It's pretty clear that low income families are going to see a tax hike under this," he said. "The real question is which low income families are going to be hit most heavily."

Barb Haselden, chairwoman of the opposition group No Tax for Tracks, said that is reason enough to reject the referendum.

Haselden owns a home and an office in St. Petersburg and estimates she would save as much as $300 under the Greenlight plan. But she worries about seniors, disabled veterans and other low-income residents, especially those who will never use public transportation.

"They're just going to be donors," she said. "These pennies add up."

Opponents are overstating the effect the sales tax would have on low-income households, said Kyle Parks, a spokesman for the Yes on Greenlight campaign.

The tax would not apply to basic needs that make up the bulk of a household's spending, such as food, medicine and medical supplies, prescription eyeglasses and baby food, Parks said, and reliable public transportation could eliminate the need for a second car.

"It's really important from our point of view to dispel the misinformation that this is going to be a huge impact," Parks said. "That perception is just not widely held. When you consider the benefits that a better transportation system would bring to people of all income levels, this is a fair way to pay for it."

City-by-city data

A city-by-city analysis shows just how much the potential impact would vary depending on household income and property values.

To estimate the net cost or savings on a typical household in each city, PSTA considered median housing values and household incomes, taxes paid on a homesteaded property, and estimated sales tax paid by a household with two exemptions.

In 11 cities — nearly all of them on the coast — households with a median income and property value would pay less than they do now. The savings range from a couple of dollars in Tarpon Springs to nearly $232 in Indian Rocks Beach.

Households in seven cities, including Clearwater, St. Petersburg, Dunedin, Oldsmar and Palm Harbor, would see increases of up to $20.

Residents in six more cities would see increases because they do not currently pay the PSTA property tax. Belleair Shore, Belleair Beach, Kenneth City and Tierra Verde do not receive services from PSTA. Treasure Island and St. Pete Beach use general fund dollars to pay for trolley service.

The Greenlight plan would add or enhance service in all five of those cities.

Business impact

The net impact to businesses is harder to calculate.

Business owners who own property would see the transit tax disappear from their bills, but their net savings or cost would depend on how many locally taxed goods they buy.

The more property a business owns, the bigger the potential savings.

Consider real estate company Bellwether Properties of Florida. With a taxable value of $142.6 million this year, the company would see its property tax bill reduced by as much as $104,000.

Other top 10 county taxpayers include DeBartolo Capital Partnership, Wal-Mart, Publix, Duke Energy and Raymond James Financial. The latter two have donated to the Friends of Greenlight campaign, touting the plan's potential as an economic shot in the arm for the county and the region.

By shifting to a sales tax, "You're moving away from having businesses pay their share of the cost of funding transit and I think that's problematic," Gardner said.

Business owners are excited about a potential property tax break but would continue to pay other property taxes and would pay the higher sales tax on goods they purchase locally, said Chris Steinocher, president of the St. Petersburg Chamber of Commerce and co-chairman of the Greenlight campaign.

Studies show a viable transit system would attract the "best and brightest" employees who demand options beyond cars, Steinocher said.

"What I'm hearing from my employers is, 'This is as much about attracting the right people to my community as it is my savings,' " he said.

Steinocher also points out that many Pinellas businesses and residents pay federal gas taxes that fund transportation projects, but Florida (and especially the Tampa Bay area) pays more than it gets back. Federal funding is a critical part of the Greenlight plan.

"That's my money and your money," he said. "We'd get back some of the dollars we've invested but haven't seen before."

Contact Tony Marrero at [email protected] or (727) 893-8779. Follow @tmarrerotimes.

NOTE: This story has been updated to reflect the following correction: A household with a median income and median property value in Belleair Beach would see a net tax increase of about $153 under the Greenlight Pinellas transit plan. Another figure, furnished by the Pinellas Suncoast Transit Authority, appeared Monday in the Times.