Hillsborough wrestles with how to spend money from its new transportation tax

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TAMPA — Hillsborough County commissioners will take two votes Wednesday to determine what projects they will pay for with revenue from the one-cent transportation sales tax approved in last November's election.

First, Commissioner Les Miller will ask fellow commissioners to reinstate the percentages, approved by voters, that once dictated how the tax money would be spent on transit, intersections, safety and other categories. Those percentages were removed from the county charter last month by a judge, which left it to county commissioners to decide how the money is spent.

PREVIOUS COVERAGE: Hillsborough's transportation tax is legal, but spending allocations and oversight committee are not, judge says

Following that vote, county administrator Mike Merrill is scheduled to present the 2020 budget, which proposes using some of the sales tax revenue to pay for road projects that the county previously had planned to pay for with property tax money.

The move, Merrill said, would help balance the budget and tackle a growing deficit. "I have been telling the board this for two years now that we were reaching a point in the unincorporated general fund where it wouldn't be sustainable," he said.

But Tyler Hudson, a leader of the advocacy group All For Transportation, which helped pass the referendum, said voters expected the new sales tax to be spent in addition to money the county previously set aside for transportation — not in place of it.

It was an issue during the sales tax campaign, he said. "Voters were absolutely concerned that the county commission would use (sales tax) funding as a bailout and not follow through with their previous promises on transportation funding."

Long before the sales tax campaign was launched, commissioners in 2017 approved a 10-year, $812 million transportation plan that would be paid for with property taxes and existing county revenue. It was a compromise agreed to after the commission rejected a 30-year, half-penny sales tax surcharge the year before.

But Merrill said the policy always allowed for those projects to be paid for with other sources, not just existing county dollars. "At the time of discussion," he said, "the board anticipated if a transportation sales tax were passed, that would be an eligible funding source."

Fifty-seven percent of voters approved the sales tax in November, but its legality was almost immediately challenged by Commissioner Stacy White, who filed a lawsuit in December. Circuit court judge Rex Barbas ruled the sales tax was valid, but it was up to county commissioners, not voters, to decide what projects the tax money should pay for.

He issued his final ruling last week. Should either side choose to appeal, the case would likely jump to the Florida Supreme Court, meaning a final ruling on the future of the tax could still be months away.

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But Miller and other commissioners have gone on the record saying they want to spend the estimated $280 million in sales tax revenue in a manner consistent with what voters approved at the ballot box.

"They wanted this," he said. "I feel like we should uphold the wishes of the majority of the public."

If the board agrees to reinstate the percentages, there could be issues with Merrill's plans to use the sales tax money to help pay for the $812 million of road projects.

The plan would work in the short term. The 2020 budget proposes that only $31 million of the sales tax be spent on that existing project list, which includes resurfacing, safety and intersection projects.

But if commissioners continued to use sales tax dollars to pay for those projects down the line, as Merrill suggests, the county would run into an issue with predetermined spending allocations. Those percentages only allow for up to 15 percent to be spent on road widenings, Merrill said, which would leave about $500 million of road projects unfunded.

"We would have a lot of underfunded transportation projects," Merrill said. "The board would either have to find a new funding source, raise millage or cut services."

But Miller said he was concerned with Merrill's suggestion to reroute sales tax dollars.

"To me, that is not what the people, what the voters, wanted," Miller said. "They wanted that money to be an enhancement as opposed to switching that out."

All For Transportation leader Christina Barker said it comes down to an issue of trust. Using the tax money to pay for road projects the county had already allocated money to would erode faith voters had in their elected officials, Barker said, even if it is a way to address a growing deficit.

"We understand the county has other needs," Barker said. "But they need to be as brave as their constituents were when they decided to fix transportation, and find a way to fix their budget issues without going back on previous commitments."

Contact Caitlin Johnston at cjohnston@tampabay.com or (727) 893-8779. Follow @cljohnst.