A.G. Gancarski
In a drama-free move, the Jacksonville City Council Finance Committee approved a bill authorizing a referendum on extension of the half-cent sales tax on Monday.
Bill 2016-300 passed unanimously as an emergency measure.
CFO Mike Weinstein noted that the referendum would close the three existing pension plans, which created the $2.7 billion unfunded pension liability.
“The beauty of this plan,” said Council Vice President Lori Boyer, is this money can only be used for the unfunded pension liability debt, and that can only happen if “this plan is completely closed.”
Councilman John Crescimbeni noted that “there are a lot of moving parts to this,” and that if the current pension plans are not closed, it’s “game over.”
“I caution my colleagues not to get too hung up on details, because it’s still squishy at this point …. short of a millage rate increase, there is no other option,” Crescimbeni continued, vowing to “convince voters to support this in August.”
Councilman Matt Schellenberg said he “alleviated” the concerns of people in a town hall recently by ensuring that constituents were able to “trust that this half-cent sales tax is only going to the pension fund.”
“I said ‘hey, listen, if you don’t do this, your millage rate will go up,” and that the consumption tax shifts the burden to surrounding counties also, such as St. Johns to the south of his district.
Councilman Danny Becton noted that within a few years, if nothing is done, the city would be on the hook for $433 million of pension costs around 2021 … a number that would be 40 percent of the city’s operational budget.
“We have some obligations that are really beyond our means,” Becton said.
Councilman Tommy Hazouri said his biggest concern is that Jacksonville needs to start substantially reducing the unfunded liability before that tax comes in.
The bill, said Weinstein, will require employees to commit to a 10 percent contribution.
