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PolitiFact Florida: Fact-checking the tax swap for Greenlight Pinellas

 
Greenlight Pinellas aims to expand bus service by adding routes and extending hours, but also would add a 24-mile light-rail line between St. Petersburg and Clearwater. [LARA CERRI | Times]
Greenlight Pinellas aims to expand bus service by adding routes and extending hours, but also would add a 24-mile light-rail line between St. Petersburg and Clearwater. [LARA CERRI | Times]
Published Oct. 20, 2014

When it comes to discussing the Greenlight Pinellas mass transit initiative, two things are certain: Taxes and citizens complaining about taxes.

If the measure passes on Election Day, the county's sales tax would go up 1 cent. So an opposition group has made the alleged unfairness of it all a cornerstone of its campaign. No Tax for Tracks, a grass roots group opposed to Greenlight Pinellas, said in an email to voters that not only is the switch from a property tax for the Pinellas Suncoast Transit Authority to an increased sales tax unfair, it's going to last forever.

"They call it a 'tax swap,' but PSTA's revenue will increase from $32 million per year to $148 million per year," the email reads. "Any financial dictionary will tell you that this is not a 'tax swap,' this is a revenue increase of over 300 percent! And the tax is permanent, we never get to vote on this again."

The group has notably been mindful of its wording here, because they have said that the swap was a "300 percent tax increase." We rated that False, because that number would be the change to the PSTA operating budget, and not any individual taxpayer.

But will the tax swap for Greenlight Pinellas be permanent?

The countywide transportation plan aims to expand bus service by adding routes and extending hours, but also would add a 24-mile light-rail line between St. Petersburg and Clearwater.

In order to pay for the changes, the county's sales tax would go up from 7 percent to 8 percent, becoming the highest tax rate in the state. This would replace the Pinellas Suncoast Transit Authority's current county funding through a property tax.

Greenlight Pinellas is different from something like Penny for Pinellas, the county's 1-cent capital improvement tax. The Penny for Pinellas has to be reauthorized by voters every 10 years. Here, the interlocal agreement the PSTA and the County Commission created for the plan does not specifically guarantee a future vote on the sales tax increase.

The "tax swap," as Greenlight Pinellas organizers call it, would boost the authority's budget from about $34 million to as high as $120 million to $130 million, PSTA calculates. If voters approve the change on Nov. 4, the change would take effect Jan. 1, 2016. Any future changes to the Greenlight plan would be subject to a referendum.

The property tax technically wouldn't go away, as the PSTA needs the state to approve its elimination. Gov. Rick Scott vetoed a bill in 2012 that would have done this, getting rid of the property tax and replacing it with the increased sales tax if voters choose. Now, if Greenlight Pinellas passes, the PSTA would set the millage rate to zero and start collecting the sales tax. The property tax could be eliminated by the Legislature in the future, but the fact that it would still exist on property tax bills has led No Tax For Tracks to speculate this could lead to double taxation. Greenlight Pinellas rules say PSTA can't have both sets of tax revenue.

The new sales tax itself stays in place "until repealed," as the ballot language says. No Tax for Tracks argues that repeal won't ever take place, because of how the PSTA and Pinellas County agreed to fund the project.

The interlocal agreement says the surtax money can only be used to fund Greenlight projects, PSTA chief development officer Cassandra Borchers told us. It also specifies that the county has to continue to fund PSTA operations and maintenance.

However, there are ways written into the agreement for the tax to be rescinded. If the plan isn't implemented as promised or in the time frame allotted, if the money from the sales tax is used for something other than the Greenlight plan, if there is a payment default or some unforeseen calamity in the future, the tax can be reduced or terminated. It also is slated for review in 50 years, and every 20 years thereafter.

But overall, it won't be easy to stop the tax once it starts. That's because the tax money is going to pay for a major construction project.

Jewel White from the Pinellas County Attorney's Office said there are clauses written into the contract that allow for decades of guaranteed tax money in order to secure financing for capital projects, such as more buses and the proposed light-rail line.

Unless one of the triggers to end the sales tax is met, the County Commission likely wouldn't examine the issue, White said. Because the sales tax is under the same ordinance that governs initiatives like Penny for Pinellas, it has to be put to voters to be enacted, she said. After that, options for repeal are few.

Pinellas residents could ask the commission to address the issue.

"Certainly, anyone can approach the commission at any time," she said. "Once money gets bonded, though, it's pretty hard to undo."

No Tax for Tracks activists also said these steps are wholly improbable, because if the county ended the tax, they would have to find some way to continue to pay its obligations to PSTA.

The statement is partially accurate but leaves out important details. We rate it Half True.

Edited for print. Read the full version at PolitiFact.com/florida.