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A Times Editorial

Mayor has no business handing out tax gifts

St. Petersburg Mayor Foster wants to write off a Progress Energy tax bill.


St. Petersburg Mayor Foster wants to write off a Progress Energy tax bill.

St. Petersburg Mayor Bill Foster wants to write off Progress Energy Florida's $147,000 tax bill because he considers the company a good corporate citizen. If that's all it takes to avoid paying taxes, the mayor better prepare for a long line outside his office. Every philanthropist, volunteer and business contributing to the civic life in St. Petersburg ought to get the same deference. Foster has no business giving away tax breaks, particularly when the city faces a budget shortfall, and this would set a horrible precedent. The City Council should refuse to endorse this expensive gift, and Progress Energy chief executive officer Vinny Dolan can demonstrate the utility's commitment to the community by walking a check over to City Hall.

City auditor Bradley Scott — whose job is to help ensure the city receives the taxes it is owed — discovered in September that Progress Energy had not been collecting and remitting utility taxes and franchise fees on several properties the city annexed in 2004 and 2007. The bill ultimately totaled about $147,000. That is a pittance compared to the $184 million the company did remit during that time, and the company contends the mistake happened because of a failure of proper legal notice by the city.

The auditor recommended the city demand payment from Progress Energy. But earlier this year, as the dispute continued, Foster cut his own deal to let the company off the hook. As St. Petersburg Times staff writer Michael Van Sickler reported Thursday, Foster decided he didn't want to upset such a "good corporate citizen" and told the company the city would not sue over the unpaid taxes in recognition of Progress Energy's considerable charitable contributions. Notable among those gifts is the $50,000 the company gave last year to Foster's pet project, a sports alliance that helped bring International Baseball to Progress Energy Park.

Never mind that Progress Energy's generosity is possible in part because Foster's constituents pay their bills every month. Never mind that no other Progress Energy customer has the option of avoiding city taxes because he wrote a check last week to the Florida Orchestra, the Dalí Museum or another St. Petersburg nonprofit, or volunteered to feed the homeless or tutor a child.

A draft of the resolution that Foster wants the City Council to bless later this month would forgive the utility the tax debt, owing to "the significant monetary charitable contributions" it makes to the city and the arts. But charity is voluntary, and taxes are not. As an attorney, Foster knows that. As mayor, he has a responsibility to ensure taxes are applied as fairly as possible. And the next time a dispute over a tax bill erupts, it should be handled by city lawyers instead of the top elected public official. The City Council shouldn't endorse his scheme, and Progress Energy should be too embarrassed to accept a tax break its customers can't get.

Mayor has no business handing out tax gifts 04/14/11 [Last modified: Thursday, April 14, 2011 7:27pm]
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