That piece of jewelry or T-shirt is about to get a little more expensive in Manatee County as the county’s half-cent infrastructure sales tax goes into effect Sunday.
When Manatee County residents and visitors hit stores and restaurants from Sunday on, the Manatee sales tax rate will be 7 percent instead of the current 6.5 percent rate. The increase comes after voters in the Nov. 8 election approved the county’s half-cent sales tax along with the extension of the half-cent school sales tax.
The Manatee Chamber of Commerce hasn’t heard of any problems from businesses preparing to implement the higher rate.
“We’ve heard positive things that businesses are looking forward to the impact of the additional revenue the county has for infrastructure and roads and parks and public safety,” said Michael Gallen, the chamber’s vice president of public policy and small business. “A lot of our surrounding communities already have the 7 percent rate. They just adjust their system and move forward. We haven’t heard any challenges.”
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County officials estimated the sales tax, which will be in effect for 15 years, will generate $30 million a year, with about $5 million allocated for the cities. The sales tax should generate enough to address transportation, public safety and parks and community amenity needs as the county faces a deficit come 2018.
“The board could, if the need arises, begin spending money this year, but we would have to have a budget public hearing much like we have in September to amend the existing budget,” County Administrator Ed Hunzeker said. “I’ll be meeting with staff after the first of the year, as well as sheriff, to determine what needs will be required in current year. That would include potential indebtedness.”
The county will receive monthly checks, which are mailed directly to the Clerk of Circuit Court office, with the first check expected in February, Hunzeker said.
“If we have projects that are shovel-ready and we want to get going, there could be a need to borrow money and begin projects,” he said.
While impact fees cannot be used to repair existing assets, sales tax revenues can be used to leverage the issuance of debt to finance improvements. About 71 percent of the revenue will go toward transportation projects, 15 percent for public safety and law enforcement, and 14 percent will go toward parks and community amenities.
7 Percent that Manatee sales tax rate will be effective Sunday
“The ordinance the board adopted allows for debt,” Hunzeker said. “We currently don’t have a plan to issue debt. However, that could change. The current budget adopted by the Board of County Commissioners does not contemplate the sales tax. The budget was adopted before voters approved it.” The fiscal year 2018 budget will incorporate the sales tax and the initial projects in the Capital Improvement Program.
The county is seeking a financial adviser for future bond issues, with proposals due to the county by 3 p.m. Wednesday.
“The selected proposer will provide services in the areas of facilitating sale of tax-exempt municipal bonds to finance new projects, coordinating bank loans and reviewing outstanding debt for potential savings on refundings,” according to the RFP. “The county has intentions to issue additional debt for capital based on the current Capital Improvement Program for Transportation and Utilities programs. The county also desires the flexibility for re-analysis based upon needs and market availability.”
The search for a financial adviser comes after the county’s current adviser, Ed Bulleit, elected to pursue other opportunities, according to Hunzeker.
It is always prudent to have a financial adviser as it relates to your indebtedness.
County Administrator Ed Hunzeker
“It is always prudent to have a financial adviser as it relates to your indebtedness,” he said. “We have to be in contact with the credit market on a regular, periodic basis even when not in the business of issuing debt. There are a number of firms that will be qualified and probably respond. Our excellent credit rating will generate responses to solicitation. Our excellent rating is because we don’t have a large portfolio of debt.”
According to the RFP, the county had $323 million of debt outstanding as of Sept. 30, 2015, plus $2.6 million in outstanding state infrastructure loans. In 2016, the county issued an additional $50.9 million of debt outstanding.
“We will be preparing to borrow money to fund the 44th Avenue project to completion,” Hunzeker said. “That will be repaid with impact fee revenues and we have ongoing plans for utilities debt to maintain existing infrastructure that is in the ground and getting older that will be repaid with utility rates.”