Sunday, October 25, 2020

Benefits of the 1% Sales Tax Increase Detailed


Once scoffed at by the Marco Island City Council, the 1% increase in the Collier County Sales Tax appears to have found a number of converts on the council, now that it was approved by a referendum of county voters during the 2018 general election.

Prior to that vote in November 2018, the City Council held little if any conversations regarding the potential for good that the additional funding could provide to the city for projects that are either not funded or which stood to be underfunded. 

At the January 6 meeting of the City Council, Councilor Larry Honig displayed a pie graph that indicated what the Council was looking to fund over the 7 years of the increase of 1% on the present 6% County Sales Tax. Another graph showed the anticipated revenue sources for those projects, and the 1% in-flow of cash from the temporary hike in the 6% sales tax plays a major role in meeting those demands.

The monies raised would be split between the county and the cities within Collier County. The county would receive $420 million and the cities would receive the additional $70 million. Those dollars would have to be used for transportation, facilities and capital replacement projects and community priorities. 

The tax increase did not apply to food or medicine. The first $5000 of a major purchase would only be taxed as part of the total income realized from the plan would be capped at $490 million and the sales tax rate would be returned to 6% if the $490 million is reached before the sunsetting of the increase on December 31st, 2025.

The issue was hotly debated during 2018 as advocates and foes alike lined up on both sides of the issue, however, when the votes were counted, the issue passed by a slim majority with 73,173 voting in favor and 70,660 opposed.

As part of the Councilors’ Communication, Councilman Honig discussed the issue of the funds being made available by the additional 1% on the existing 6% county sales tax. 

“The purpose of this discussion is to make our intentions very public as to how we intend to spend the money provided by the 1% sales tax vote. At Councilor Grifoni’s request and under Interim Manager David Harden’s direction, this subject matter was discussed at a public workshop on May 20, 2019, held in the afternoon session, somewhat hidden from the real open public view,” said Honig. His presentation was meant to shed more light on the potential windfall of $24,546,956 in additional revenue which will be received via the 1% tax increase through December 31, 2025.

Over the last several years, the City Council has come under criticism for making some of the more major decisions concerning city business during the off-season when so many residents have left for the summer months or during times of the day when citizens cannot make the meetings.

The projects that have initially been earmarked are as follows.

  • Veterans Community Park Improvements – $7,000,000
  • Replacement of Fire Station 50 – $8,000000
  • Extra Street Paving – $2,200,000
  • Storm Water Management – $4,950,000
  • Parking Improvements – $2,200,000

These projects may not be set in stone but could be adjusted. The projects must only be utilized for capital needs and those dollars would have to be used for transportation, facilities, capital replacement projects and community priorities.

One response to “Benefits of the 1% Sales Tax Increase Detailed”

  1. Gary R. Broad says:

    Rather than always increasing Taxes use some common sense and REDUCE SPENDING. I also understand Marco Island has a very large debt.

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