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Forget this old idea of a new tax district

The Hernando commission just can't get away from a bad idea — starting a new tax district for an essential or desirable public service. Nearly every spring for the past decade, the idea blooms early in the budget season, only to be rightfully nipped in the bud by commissioners reluctant to add new line items to annual property tax bills.

This year, the county staff wants a public hearing to propose a new taxing district to pay for libraries. Commissioners shot down the same notion a year ago. Meanwhile, Commissioner Diane Rowden wants to talk about a tax district, known as Municipal Service Taxing Unit, or MSTU, for law enforcement. It's the same proposal she has floated almost every year between 2003-08. It has never gained traction, and it shouldn't now.

The staff's idea is to assess a quarter mill property tax, or 25 cents per $1,000 of assessed real estate value, to raise roughly $2 million for libraries. The focus on library funding is welcome after years of benign neglect that saw the county system absorb $2 million in budget reductions over three years. That resulted in less operating hours and 16 fewer positions on the payroll. Commissioners also approved and then extended a moratorium on impact fees on new home construction that would have financed capital spending on libraries.

Even with the cuts, the Hernando County Library system's performance earned it statewide recognition as the Florida Library Association's library of the year for 2013. Just two months ago commissioners agreed to a new three-year plan for libraries focusing on serving the community, innovation and cost-efficient customer service

The county doesn't need a new taxing mechanism to help achieve those goals. It needs a commission commitment to reverse the trend of treating libraries as an after-thought. For political cover, the commissioners can check the results of their just-concluded citizen survey in which 63 percent of the respondents said maintaining services is more important than lowering taxes and fees.

Now Hernando's general fund tax rate is $5.92 per $1,000 property value. It also has additional taxing units for transportation, public health, mosquito spraying, emergency services, stormwater management and fire protection in Spring Hill. Why add another?

Raising the general fund tax rate to $6.17 per $1,000, or the equivalent of an extra $25 in annual tax on a house with a taxable value of $100,000 after exemptions, achieves the same financial goal as a new quarter-mill tax for libraries. It also avoids the pitfalls of establishing separate financial silos for each government service.

Besides, establishing separate taxing units for unincorporated Hernando County means the city of Brooksville, and its 3,800 taxable parcels valued at nearly $400 million, don't contribute unless the county and city negotiate contracts for the government service financed by an MSTU. In other words, with fewer property owners contributing, the commission faces the likelihood of having to collect higher taxes from the rest of the county taxpayers to maintain status quo funding. It is a tax equity issue that never seems to be considered during these annual discussions.

Commission Chairman David Russell, a critic of the tax districts, offered a practical observation Tuesday. "The money all comes from one source,'' he told the rest of the board. "It comes from the people.''

Indeed, and it doesn't matter from which pocket. The commission should abandon the idea of starting new taxing districts to pay for existing public services.

Forget this old idea of a new tax district 03/30/13 [Last modified: Saturday, March 30, 2013 9:33am]
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