Charter proposal bad for business growth

Charter proposal bad for business growth



By DON WALLIS
St. Augustine
Publication Date: 08/03/08

Soaring costs of fuel and food have everyone concerned about their budget. The state of the economy makes headlines daily. Yet no one seems to be asking the question, "How will charter government affect our checkbook?"

The commentary surrounding the proposed charter government so far has been focused around term limits, campaign finance and accountability. Completely overlooked have been the economic implications of the proposed charter, but to ignore them would be a mistake.

In the 1972 case of State ex rel Volusia County v. Dickinson, the Florida Supreme Court upheld a charter county's ability to levy utility taxes, noting, "unless precluded by general or special law, a charter county may, without more authority of existing general law, impose by ordinance any tax in the area of its tax jurisdiction that a municipality may impose." That translates into the ability to levy, among other taxes, up to a 10% tax on utilities, including electric, fuel oil/kerosene, water, natural gas, liquefied petroleum, etc. Twelve of the existing 19 charter counties in Florida (out of a total of 67 counties) have chosen to levy a utility tax, and nine of those counties impose the maximum rate allowed by law.

As written, the charter document that will be voted on, on Aug. 26, does not address the county commission's ability to levy a utility tax on unincorporated areas. However, the absence of any language prohibiting this taxing authority leaves it wide open for the county commission to impose a 10 percent tax on your electric and water bills starting Jan. 1, 2009.

One can suppose that the absence of any mention in the proposed charter of a utility tax indicates that there is no intention to utilize this taxing authority, but there is ample evidence, in the form of comments from candidates for county commission, a utility tax in fact is being considered as a solution to the budgetary needs of the fire department.

A 10 percent utility tax is an additional strain on a household with an average electricity bill, so you can imagine the enormous impact that this tax could impose on our local manufacturers and large employers. As demonstrated by the now discredited fire service fee, our county commission often overlooks the economic impact that their decisions have on the business community. Businesses would have been slapped with the bulk of the burden of the fire fees, often citing $3,000 or more in fire fee assessments -- in some cases, doubling their current property tax bills.

Recently a county commissioner expressed his concern over the impact that the proposed 16 percent rate increase by FPL would have on small businesses. While I appreciate the efforts to protect both consumer and business interests, I am left wondering why they are turning their heads on this utility tax.

In addition to the serious threat of new taxes that the proposed county charter would create, the lack of information addressing the potential cost of this change of government is disconcerting. How much will it cost the taxpayers to make the change from our current form of government to charter? A provision in the proposed charter requires an economic impact analysis accompany any future ballot amendments, but I have yet to see any information on the currently proposed charter or its amendments.

A vote for charter government is a vote to give more of a taxing authority to the county commission.

On July 30, the Board of Directors of the St. Johns County Chamber of Commerce voted unanimously to oppose the county charter as proposed on the Aug. 26 primary ballot.

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Don Wallis is incoming chairman of the St. Johns County Chamber of Commerce and is an attorney with Rogers Towers, P.A.

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