County seeks fresh sales tax increase

Move follows ’16 rise for parks, roads

Palm Beach County’s sales tax could go up again, this time to help pay for firefighters and other emergency services.

Just six months after voters approved raising the sales tax to pay for fixing aging schools, parks and roads, the County Commission on Tuesday agreed to consider pushing for another sales tax boost.

The proposal could raise the sales tax from 7 cents to 7.5 cents per dollar spent on everything from a new shirt to a new car.

That would make Palm Beach County’s sales tax pricier than Broward (6 cents) and Miami-Dade (7 cents), and one of the highest sales taxes in Florida — where the sales tax on most transactions typically ranges from 6 to 7.5 cents per dollar.

Voters get the final say on whether to raise the sales tax again.

Commissioners Tuesday called for staffers to review the effects of another sales tax increase. After getting that report, commissioners are expected to decide whether to put it on the ballot in 2018.

Commissioners say the possible increase is a reaction to the Florida Legislature’s proposal for more property tax exemptions — which would cut the amount of money cities and counties get from property taxes.

“I don’t do this lightly,” said County Commissioner Melissa McKinlay, who called for exploring another sales tax increase. “We are going to have to get a little creative about diversifying our revenues.”

But the County Commission blaming the Legislature in order to push for another sales tax increase is just an excuse to raise more money, said Sid Dinerstein, of Palm Beach Gardens, who led opposition to last year’s penny sales tax increase.

“They will never have enough,” Dinerstein, former chairman for the Republican Party of Palm Beach County, said about the County Commission. “They just take the money because it’s there and they can fool the people into doing it.”

The Legislature is considering doubling the state’s $25,000 homestead exemption for Florida residents, allowing a $50,000 deduction from the taxable values of more homes across the state.

What would be good for homeowners’ bank accounts would be bad news for city and county coffers.

“It’s going to be a huge burden to overcome,” County Commissioner Dave Kerner said.

The county’s Fire Rescue department has a nearly $400 million budget.

State law allows local voters to decide whether they want to approve a sales tax increase to help pay for emergency services. It was envisioned as a way to allow for a tax swap — using money raised from increased sales taxes to compensate for lost revenues from lowering property tax bills.

“It’s really a substitute tax,” Commissioner Hal Valeche said.

The county in 2010 proposed pursuing a sales tax increase to help cover firefighter costs. But that tax push was scrapped over legal concerns about a potential overlap between the sales tax increase kicking in while the property taxes for fire services were still being charged.

Dividing the sales tax revenue among the cities and the county was another stumbling block.

Business leaders, including the Economic Council and the Realtors Association of the Palm Beaches, opposed the 2010 county proposal to increase the sales tax to pay for emergency services costs.

The sales tax increase approved last year is expected to raise about $2.7 billion over 10 years, helping pay for school repairs, refurbished roads, improved parks and other public facility upgrades.

Another sales tax increase may not end up being the right solution to addressing a potential financial squeeze, County Mayor Paulette Burdick.

If state lawmakers allow more property tax exemptions, the solution could be raising local property tax rates to generate money needed for “health, safety and welfare” needs, Burdick said.

County property tax revenues have been on the rise in recent years, thanks to an improving real estate market.

“This is going to be a significant hardship,” Burdick said about legislators pushing for more property tax exemptions. “I don’t know what they were thinking.”