Florida has $562M meant for Hillsborough County. How will lawmakers return it?

One of the lingering questions of the remaining three weeks of the Regular Session is what the Legislature will do with a $562 million pot of money intended for Hillsborough County transportation projects.

Hillsborough County voters approved a 1% sales surtax in 2018, with the revenues to be used for transportation. But six years later, none of the money has been spent. That’s because the tax was challenged in court and in 2021 the Florida Supreme Court ruled it unconstitutional because the charter amendment referendum restricted how the County Commission could spend the funds, contradicting state law.

When a similar referendum was put before voters in 2022, with inflation spiking at the time, voters rejected it.

But while the case made its way through the courts, consumers in Hillsborough County were paying the tax. All told, $562 million in revenues and interest accrued and the money now sits with the Department of Revenue (DOR). In 2022, a lower court Judge ruled the money had to be spent on Hillsborough County transportation projects, but lawmakers haven’t reached an agreement on how to spend the money.

Last year, the House wanted to exempt a portion of Hillsborough County sales taxes, using the money from the surtax to replenish the county until it ran out. The Senate wanted to set up a program within DOR to allow individual taxpayers to request refunds. Ultimately the chambers failed to agree how to spend it, so the funds continue to sit in DOR.

This year, lawmakers are being cagey about what they want to do with the money. The issue isn’t addressed in either chambers’ tax cut package, nor is it included in either budget, meaning it will likely be part of budget negotiations between the House and Senate in the final weeks of the Session.

Hillsborough County delegation members have held discussions about how best to return the funds to their area, but none have said publicly what they would prefer.

Gov. Ron DeSantis’ recommended budget included a plan to transfer the money from DOR to the Florida Department of Transportation (FDOT). FDOT would then draw up a plan for spending the money on road projects in Hillsborough, to be approved by the Legislative Budget Commission in September. That is one option still under consideration by lawmakers.