County Administrator Jeff Rogers attended the regular Brooksville City Council meeting on April 4, 2022, to present and discuss the county’s plan for a half-cent sales tax increase that will appear for a vote on the November ballot. There are implications for the City of Brooksville should the sales tax increase be approved, namely a $662,000 (annual) revenue increase. Hernando County expects to increase its revenue by $13,898,033 annually.
Its official name is “Half-penny Local Option Sales Tax (LOST),” which is expected to provide additional revenue for the county’s infrastructure needs while reducing reliance on property tax.
The concept behind LOST is that revenue will be generated by anyone purchasing goods in the county, not only homeowners. Rogers reported that 30% of sales taxes are paid by tourists and employees who do not live in the county.
A Citizen Oversight Committee will be assembled to enforce the proper use of revenue collected by the tax.
Rogers reported that there are other legitimate uses for LOST, however, the County is only asking the citizens to use the funding for finance, planning, and construction of infrastructure.
According to the presentation, “The tax would only be collected on the first $5,000 of large purchases of tangible personal property (TPP) or a maximum of $50 on a single purchase.”
The sales tax increase cannot be used for operational expenses or salaries. Groceries, medical services, medication, and fuel are exempt from the tax.
The growth of single-family homes in the county has more than quadrupled since 2015, which saw 389 permits for such homes. So far, in 2022, the county has issued 1,833. With such growth comes the need for roadway projects, and expanded recreation projects. The county is planning to allocate 80% of LOST funds for roadways and 20% for parks and recreation.
According to Rogers, 100 flag football players were unable to play last year due to a lack of ball fields.
Gas tax revenue has been stagnant for the past five years. The county collected $11,311,707 in 2017, and $11,509,801 in 2021. Less than $11 million was collected in 2020, largely due to the COVID-19 pandemic. Unlike materials to fix roadways and signage, gas taxes do not increase every year. Rogers said, “Gas tax is not a Hernando County problem, it’s a whole country problem.”
Hernando County spends its gas tax revenue on transit (The Bus), repaving and intersection improvement, road and traffic maintenance, facility operation and overhead and limerock road paving. Roadway widening is not funded by the gas tax.
Rogers spoke about the possibility of the county receiving a $25 million grant from the federal government’s recent $1.3 trillion infrastructure bill. To receive the grant, the county must invest $5 million. The $25 million is slated to widen and improve a portion of County Line Road.
Rogers also showed that impact fees are still not adequate to build roadways. Existing impact fees total $4,519,200 of the total cost of roadways, which comes to $211,942,010.
Approved language of the November referendum:
“TO ENHANCE THE QUALITY OF LIFE FOR HERNANDO COUNTY’S RESIDENTS, SHALL HERNANDO COUNTY LEVY A ½-CENT SALES TAX, THE PROCEEDS OF WHICH SHALL BE EXCLUSIVELY USED TO REDUCE TRAFFIC CONGESTION, TO CONSTRUCT AND IMPROVE ROADWAYS, AND TO CREATE AND IMPROVE PARKS AND OTHER RECREATIONAL FACILITIES, WITH HERNANDO COUNTY’S USE OF THE PROCEEDS TO BE SUBJECT TO CITIZEN OVERSIGHT?
__YES – FOR THE ½-CENT SALES TAX
__ NO – AGAINST THE ½-CENT SALES TAX”
If approved, the resolution will be valid for 10 years from the date of enactment, and renewable at its end.
Rogers showed a table of surrounding counties’ sales tax rates, which range from 6.0% – 7.5%. Hernando is currently 6.5%. The school district may pursue a renewal of their half cent sales tax currently used for capital expenses on the November ballot as well.