County Commissioner Leslie Campione, School Board member Bill Mathias, Vance Jochim and Don Magruder participated in a panel discussion about the proposed 15 year extension of the existing one cent penny sales tax (Penny Tax).
The Penny Tax, also known as the infrastructure sales tax, is a one cent sales tax added to the existing six cent state sales tax collected on the purchase of certain items. The existing Penny Tax will no longer be collected after December 31, 2017 unless voters approve a 15 year extension during a special election on November 3, 2015.
The Penny Tax is not new. It was first approved by voters in 1988 and again in 2001. Revenue collected by the Penny Tax is distributed to Lake County, Lake County School Board and the municipalities in Lake County. Florida law restricts how these local governments can use Penny Tax revenue.
Penny Tax revenue can be used to pay for six types of projects: law enforcement, fire and EMS vehicles and equipment; construction, reconstruction or remodeling of school facilities; parks, trails, recreation and libraries; roads, sidewalks and transportation; water quality, utilities and drainage improvements; and other public infrastructure.
Allowable uses provide for the support of capital projects, infrastructure or equipment with a life-span of greater than five years. Use of property tax and other revenue sources can be avoided when additional revenue is made available from collection of the Penny Tax for these purposes.
The Sales Surtax Oversight Advisory Committee, consisting of nine members, review how Penny Tax revenue is spent by eligible local governments and reports findings twice a year to the Lake County Board of County Commissioners. The Penny Tax is implemented by a county ordinance.
There were many questions from the audience regarding the proposed Penny Tax extension. For instance, why is a special election being held in 2015 when the existing tax does not expire until the end of 2017?
The response was that the county commission authorized a special election to be held in November 2015 in view of the fact voters will be addressing other important issues on the 2016 ballot, including the presidential election. Of concern too was why the extension needed to be 15 years in duration.
A longer term is needed to allow for the financing of some capital projects through bonding. Many of the smaller municipalities do not have enough revenue available to pay for the entire cost of capital projects, infrastructure, and equipment in a lump sum manner.
More information about the Penny Tax can be found on the Lake County and Lake County School Board websites.