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  1. Hillsborough

Hillsborough County eyeing alternative tax options to fund transportation needs

Hillsborough County knows the frustration of the growing traffic east of Interstate 75 on State Road 60.  (LUIS SANTANA   |   Times)
Hillsborough County knows the frustration of the growing traffic east of Interstate 75 on State Road 60. (LUIS SANTANA | Times)
Published Jul. 25, 2019

TAMPA — With its voter-approved transportation sales tax in legal limbo, Hillsborough County Commissioners voted unanimously Thursday to forge ahead with a budget plan for the next fiscal year that doesn't depend on revenue already being collected through the penny tax.

The county is facing a shortfall when it comes to funding the laundry list of transportation projects that have gone neglected despite years of urban sprawl and exploding population growth, said Public Works Director John Lyons said.

County Administrator Mike Merrill had hoped the commission would use some of the new transportation tax revenue to pay for previously-scheduled road projects that are now funded by the county's dwindling reserve of property taxes. Merrill said the county should do that every year to reduce the budget deficit and free funds to address a backlog of other needs, such as expanding fire service.

The county had been slated to fund $31 million in existing transportation projects next fiscal year, but without clarity on the future of the sales tax, commissioners voted to scrap that plan completely.

RELATED: Florida Supreme Court to decide future of Hillsborough's transportation tax

The commission's vote only granted the county a one-year exemption from a transportation spending plan adopted in 2017. That plan, known as the $812 million plan, promised to dedicate one-third of all new property taxes, an estimated $812 million, on funding long-ignored transportation needs over a 10-year period.

Now, the plan will be reduced to $781 million. And to fulfill all of the county's current transportation needs — a growing backlog of improvements in pedestrian and bicycle safety, road expansion and needed maintenance — it would cost about $2.58 billion, Lyons said.

"From my perspective, this is a revenue problem, it's not an expenditure problem," Merrill said. "There are no services anybody wants to cut, and we've pretty much ground this to the bone in terms of expenditures. In the long run, land use changes will maybe solve part of the problem, but our immediate challenges are existing deficiencies."

Commissioners didn't have to find an answer at Thursday's workshop, where Merrill presented the proposed budget for the 2020 fiscal year. Instead, county staff plan an additional schedule of transportation workshops next month.

Any changes to the budget must be made ahead of the county's first public budget hearing Sept. 12. The commission is set to approve the final budget Sept. 19, following a second public hearing.

The likelihood of the Florida Supreme Court to determine the constitutionality of the county's one-cent transportation tax by the final budget hearing is slim at best, Lyons said. And until that happens, the county can't take a gamble on a favorable ruling.

Lyons presented the board with four options for funding the transportation shortfall. Increasing the county's fuel tax by 5 cents would bring in an estimated $29.8 million in revenue for the county each year, Lyons said. Increasing the county's communication services tax from 4 percent in the unincorporated areas to the maximum 5.22 percent would generate an additional $5.9 million each year, Lyons said, and levying a 10 percent public service tax on county services such as water and electricity would bring in up to $80 million each year.

Commissioners balked at the idea of increasing the countywide millage, voting instead to keep rates no higher than the current levels next fiscal year.

The county will continue to fund its existing transportation projects, but it will not embark on any new initiatives that rely on property taxes for funding.

"We can learn lessons, certainly, but the main point is we cannot continue to fund transportation and other essential services from general revenue, we need a dedicated transportation funding source," Merrill said. "Hopefully we will have that when the Supreme Court decides."

Contact Anastasia Dawson at adawson@tampabay.com or (813) 226-3377. Follow @adawsonwrites.

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