GreenLight Pinellas - An Analysis of Ordinance 13- 34

In the November 4, 2014 election Sales Tax Referendum you are NOT voting directly on the GreenLight Plan.

This is the language you will see on the Ballot:

Levy of Countywide One Percent Sales Surtax to Fund Greenlight Pinellas Plan for Public Transit.

Summary: Shall the improvement, construction, operation, maintenance and financing of public transit benefiting Pinellas County, including an expanded bus system with bus rapid transit, increased frequency and extended hours, local passenger rail and regional connections be funded by levying a one percent sales surtax from January 1, 2016 until repealed, with the proceeds deposited in a dedicated trust fund? 

___ YES, for the 1% sales surtax 

___ NO, against the 1% sales surtax 

Read that title very carefully. You are voting to make Ordinance 13- 34 a law. This is an important distinction, because Ordinance 13- 34 will become a law if the referendum succeeds, but the GreenLight Plan does not.

Here is a link to the actual Ordinance (Law) that you are being asked to approve in the sales Tax Referendum: Greenlight Pinellas Tax Ordinance. 

You can also read my review of the Pinellas County/PSTA Interlocal Agreemet 

which  activates if the Sales Tax Ordinance passes.

 ORDINANCE  NO. 13- 34 

AN ORDINANCE OF THE BOARD OF COUNTY COMMISSIONERS OF PINELLAS COUNTY LEVYING THE CHARTER COUNTY AND EGIONALTRANSPORTATION SYSTEM SURTAX SUBJECT TO ELECTOR APPROVALAT A RATE OF ONE PERCENT; ESTABLISHING THE EFFECTIVE DATE OFTHE SURTAX; PROVIDING FOR ADMINISTRATION, COLLECTION, ANDENFORCEMENT OF THE SURTAX; PROVIDING FOR THE DISTRIBUTION, USE, AND FINANCIAL MANAGEMENT OF SURTAX PROCEEDS; CALLING FOR A REFERENDUM ELECTION FOR APPROVAL OF IMPOSITION OF THE SURTAX; PROVIDING A BALLOT TITLE AND SUMMARY OF THE PROPOSED REFERENDUM QUESTION; PROVIDING FOR NOTICE OF THE REFERENDUM ELECTION; PROVIDING FOR NOTICE TO BE GIVEN TO THE DEPARTMENT OF REVENUE; PROVIDING FOR INCLUSION IN THE PINELLAS COUNTY CODE; PROVIDING FOR SEVERABILITY; PROVIDING AN EFFECTIVE DATE.

The paragraph presented above in its format from Ordinance No 13- 34 is called the Preamble and appears at the top of the Ordinance document. The Preamble describes in legally acceptable terms what is in the Ordinance that follows.

Here is a Breakdown:

AN ORDINANCE OF THE BOARD OF COUNTY COMMISSIONERS OF PINELLAS COUNTY LEVYING THE CHARTER COUNTY AND REGIONAL TRANSPORTATION SYSTEM SURTAX SUBJECT TO ELECTOR APPROVAL AT A RATE OF ONE PERCENT;

This Section establishes the Board of County Commissioners legal authority to levy the sales tax increase.

ESTABLISHING THE EFFECTIVE DATE OF THE SURTAX;

This section establishes the County Board of Commissioners ability to set the effective date of the tax.

PROVIDING FOR ADMINISTRATION, COLLECTION, AND ENFORCEMENT OF THE SURTAX;

This section establishes the legal grounds for the administration and collection of the sales tax.

PROVIDING FOR THE DISTRIBUTION, USE, AND FINANCIAL MANAGEMENT OF SURTAX PROCEEDS;

This Section sets up the overall responsibility for management of the proceeds of the sales tax.

CALLING FOR A REFERENDUM ELECTION FOR APPROVAL OF IMPOSITION OF THE SURTAX;

This section sets up the referendum mechanism and calls for a public vote.

PROVIDING A BALLOT TITLE AND SUMMARY OF THE PROPOSED REFERENDUM

QUESTION;

This Section provides for the actual Ballot language you will see on your mail in or voting booth ballot.

PROVIDING FOR NOTICE OF THE REFERENDUM ELECTION;

This Section provides for public notice of the Referendum vote.

PROVIDING FOR NOTICE TO BE GIVEN TO THE DEPARTMENT OF REVENUE;

This Section provides for a legal notice to be sent to the Florida department of Revenue should the Referendum pass indicating the County will begin collecting the tax

PROVIDING FOR INCLUSION IN THE PINELLAS COUNTY CODE; PROVIDING FOR SEVERABILITY;

This Section does two important things. First should the Referendum succeed, it incorporates the language of the Referendum Ordinance No. 13- 34 into the County Code as Law and provides Severability which means if any Section of Ordinance No. 13- 34 is found to be illegal; the finding does affect any other Section of the Sales Tax Ordinance.

PROVIDING AN EFFECTIVE DATE

This Section provides for the setting of an effective date for the implementation of the Sale Tax increase should the Referendum pass.

The Preamble contains a legally acceptable summary phrasing of the Sections that follow in the actual Ordinance that will become law.

The WHEREAS Section:

WHEREAS, Sections 212.054 and 212.055(1), Florida Statutes (the "Acts"), authorize certain counties in Florida, including charter counties, to levy a discretionary sales surtax referred to as the "Charter County and Regional Transportation System Surtax" ("Surtax") subject to elector approval; and

This Section identifies the State Statute that provides for charter counties to levy sales surtaxes.

WHEREAS, the Pinellas County Board of County Commissioners ("Board") previously declared its intent in Resolution No. 13-19 to place a referendum question on the November 4, 2014 ballot seeking approval of a levy of up to one percent Surtax to fund countywide transportation projects; and

Note in this WHEREAS the law as provided for by State Statute and established by this Ordinance is constructed to allow a sales sir tax UP TO 1% but in fact the County proposes to levy the entire 1% from day one. 

There is no PSTA budget or plan that requires this fourfold increase in PSTA revenue for the very first year of the sales sir tax.

WHEREAS, the Pinellas Suncoast Transit Authority ("PST A"), a transportation authority created by a special act to purchase, own and/or operate transit facilities within Pinellas County, has developed a plan for the improvement, construction, equipping, operation, maintenance and financing of public transit benefitting Pinellas County, including an expanded bus system with bus rapid transit, increased frequency and extended hours, and local passenger rail and regional connections, commonly referred to as the "Greenlight Pinellas Plan;" and

Here the term Greenlight Pinellas Plan first appears. It is broadly defined by the terms that proceed it in the WHEREAS; and then the WHEREAS further reduces the GreenLight plans' authority by using the phrase "commonly referred to as the Greenlight Pinellas Plan."

There is no definition of the GreenLight Plan, no detail for the Greenlight plan and no specific funding allocation for the bus portion of the GreenLight Plan.

The GreenLight Plan is more of a marketing phrase than a referendum requirement. There is nothing here that ties the County or PSTA to the Greenlight plan, requires any of the sales tax proceeds to actually be spent on the plan.  In fact in the next WHEREAS it becomes clear that the real intent is to fund a bonding effort.

WHEREAS, the revenues generated by the Surtax are needed to fund the costs of public transit and the repayment of any bonds or other obligations or indebtedness which may be incurred for those purposes; and

The real purpose of this sales tax and why it is applied at the full 1% may just begin to unfold here as this WHEREAS begins to lead the revenue generated by Ordinance into the repayment of Bonds or other undefined  indebtedness.

The question is with the PSTA property tax revenue at about $40 million and an expected $100 to $130 million in annual sales tax revenue, if the Bus expansion is really the plan, could that not be handled from the additional sales tax revenues without any bonding or borrowing requirements?

There may be many reasons for moving to a bond issue but one of the principal reasons is to tie up as much of the sales tax revenue as possible in a pledge to pay the bond obligation. This one single move could legally lock Pinellas County into the 1% sales sir tax for the life of the bonds, 20 or 30 years. A large portion of the sales tax proceeds going to interest, not to public transportation.

The control of how the bond proceeds would be spent could and probably would be specified in the bond covenants and the money becomes totally out of the control of the County Commission.

The primary objective of the bonding effort would likely be to assure that the rail proposal of the GreenLight plan gets funded eliminating any future public efforts to stop the rail plan and assuring funds for everything from rail planning to construction.

WHEREAS, it is the intent of the Board to levy the Surtax at a rate of one percent (1 %)  pursuant to the provisions contained in the Acts as provided herein; and

This Section establishes that the Sales Surtax will be applied at the full 1% ($130 million) rather that gradually applied as State law allows and as the PSTA budget needs actually require additional funding to expand bus service.

This Ordinance was drafted by the PSTA Legal department and approved with almost no change by the Pinellas County Commission.

Applying a reasonable person test to just this much of the Ordinance should cause you to strongly consider voting NO.

WHEREAS, the Board finds that the transportation improvements will enhance access to major employment centers in Pinellas County, increasing the County's economic competitiveness, promote walkable communities, enhance mixed-use neighborhoods, promote economic and community redevelopment, protect stable neighborhoods, expand mobility choices for the citizens and visitors of County, promote environmental stewardship, create jobs for the citizens of the County, address traffic congestion which will promote a more efficient countywide transportation system, including without limitation, indirectly promoting more efficient delivery of public safety services, and provide greater community and regional connectivity; and

This Whereas sets the general reasons for proceeding with the Ordinance. It is by design general in approach tries to rope in as many feel good points as possible other than leading to the next Whereas.

WHEREAS, the transportation improvements therefore will further various important public purposes; and 

This Whereas, however, accepts the two above it as fact, lumping the previous Whereas in to the general term "transportation improvements" which becomes the supporting subject of the final Whereas.

WHEREAS, the levy of the Surtax therefore is in the best interests of Pinellas County and its citizens and is necessary to sufficiently fund needed transportation improvements benefitting the County.

In this Whereas, the circular logic of previous three Whereas clauses are now assumed to be in your best interest and a totally valid reason for you to accept the necessity to fund an undetermined plan and one or more to be determined interlocal agreements, and obligation bonds to build an undefined transportation system for which you will pay $130 Million per year for a to be determined period of time.

Section I. Incorporation of Recitals. The above findings and recitals are hereby incorporated herein and made a part of this Ordinance.

This Section insures that all of the Comments in the Whereas Section and Preamble are included as part of the Ordinance that will become law if approved.

Section 2. Surtax. Imposition and Levy of the Charter County and Regional Transportation System

(a) There is levied and imposed by Pinellas County ("County"), the Charter County and Regional Transportation System Surtax authorized by Section 212.055(1), Florida Statutes, throughout the incorporated and unincorporated areas of Pinellas County, at the rate of one percent (1%) on transactions taxable pursuant to Section 212.054, Florida Statutes, subject to the approval of a majority of the electors of Pinellas County voting in a referendum election called for the purpose of determining whether such Surtax should be levied. (b) The levy of the Surtax, if approved by a majority of the electors as required by paragraph 2(a) shall be limited to the purposes set forth in this Ordinance and shall take effect January 1, 2016, and shall remain in effect until December 31st of the year in which the levy is repealed as provided by law

This Section establishes the County's authority under the State statute to levy the sales tax and sets up the taxable items according to Florida law.  The amount of the sales tax is set at one (1) percent with no provision for a gradual ramp up of the tax amount.

You will also note that the use of the Tax is limited to the purpose set forth in the Ordinance and is to remain in effect until December 31 in the year in which the levy is repealed by law.

Note that any bond issue where the sales tax is pledged as a bond revenue source would prevent any repeal of the sales tax and there is no provision preventing refinancing of any initial bond issue which could, without voter approval, keep the sales tax in force literally forever.

Section 3. Administration, Collection and Enforcement. The Florida Department of Revenue shall have all responsibility for the administration, collection, and enforcement of the Surtax levied pursuant to this Ordinance.

This Section establishes the Florida Department of Revenue as the authority for administration, collection, and enforcement of the Surtax levied pursuant to this Ordinance, but the County will distribute the funds via a series of undefined interlocal agreements to PSTA.

The County and PSTA are currently frantically trying to formalize these interlocal agreements even before the Referendum vote takes place.

Section 4. Distribution, Use and Financial Management of Surtax Proceeds.

(a) The Surtax shall be collected by the Department of Revenue and distributed monthly to the County. The County shall deposit the proceeds into the Transportation System Surtax Trust Fund, which fund is hereby created, to be held by the Pinellas County Clerk of the Circuit Court and Comptroller ("Clerk") solely for the benefit and distribution in accordance with the terms of this Ordinance and any inter local agreements providing for the distribution of Surtax proceeds.

Note that there are NO terms of revenue distribution in the Ordinance and there is no definition of the terms of the undefined interlocal agreements. The funds may be held by the County but should they be pledged as bond payments, the bond covenants will set the terms for distribution. There is no specific funding identified for the Bus system expansion.

(b) Subject to the limitations imposed by applicable law, the Surtax proceeds shall be used for the improvement, construction, operation, and maintenance of public transit benefitting Pinellas County, including an expanded bus system with bus rapid transit, increased frequency and extended hours, and local passenger rail and regional connections, and for the payment of the principal and interest on indebtedness (including refinancing thereof) or other financial obligations which may be incurred for such transportation improvements, as authorized by the Acts. The County is authorized to enter into interlocal agreements pursuant to the Acts providing for the distribution of the proceeds from the Surtax to be expended for the purposes authorized in this Ordinance.

In this Sub Section we get close to a commitment to expanding bus service, with some detail: expanded bus system with bus rapid transit, increased frequency and extended hours; but no specifics related to the amount of funds, distribution or obligation of funds to the bus expansion or timing of the bus system expansion. There also no provision for preventing taking funds from the bus system to pay for cost overruns on the rail project or future shortfalls in rail operating revenues.

Here PSTA begins laying the ground work for converting the sales tax into a bond issue and sets the stage for an undefined interlocal agreement providing for the distribution of the sales tax proceeds. No detail as to what those agreements will cover, how they will be developed or who will actually vote on or approve them.

The County and PSTA are now trying to define these interlocal agreements before the Referendum somewhat like the cart before the horse. Interlocal agreements with the other jurisdictions in the County remain undefined.

Note the Ordinance (Law) that you are being asked to approve provides not only for the payment of bond indebtedness, but also allows the pledging of the sales tax revenue for refinancing the bonds, thereby virtually assuring that this sales tax will never go away.

In this Sub Section the Ordinance REQUIRES that all of the sales tax funds received be remitted to PSTA as provided for vaguely in the proceeding Section and further lays the ground work for a bond issue based on the Ordinance. This sub section essentially stops the County from withholding funds from PSTA as a punitive measure should PSTA go out of control. Note that there is no reporting or accounting provision applied via this Ordinance on PSTA to account for any of the funds.

There is no provision for withholding funds should the PSTA continue to receive Property tax Revenue.

(c) The County shall enter into the Inter local Agreement with PST A for the distribution and use of the proceeds of the Surtax as provided in subsection 4(b) herein. Any Surtax proceeds deposited in the Transportation System Surtax Trust Fund shall be remitted to the PST A in accordance with the Interlocal Agreement, and shall be used for the purposes authorized in subsection 4(b) herein, including the payment of the principal and interest on bonds or other obligations or indebtedness, or refinancing such bonds or other obligations, issued or incurred for such transit improvements, as authorized by the Acts and this Ordinance.

In this Sub Section the Ordinance REQUIRES that all of the sales tax funds received be remitted to PSTA as provided for vaguely in the proceeding section and further lays the ground work for a bond issue based on the Ordinance. This sub section essentially stops the County from withholding funds from PSTA as a punitive measure should PSTA go out of control. Note that there is no reporting or accounting provision applied via this Ordinance on PSTA to account for any of the funds.

There is no provision for withholding funds should the PSTA continue to receive Property tax Revenue.

(d) The issuance of all bonds or other obligations or indebtedness pledging the Surtax proceeds shall be subject to the prior approval of the Board, as provided in and pursuant to an interlocal agreement with the agency receiving Surtax proceeds.

This Sub Section sets up the bonding mechanism but carefully omits which Board will approve the Bonds leaving that to be defined in the interlocal agreement.

This interlocal agreement will be "worked out" between the PSTA Board and the County Commission, only problem is there are several County Commission members on the PSTA Board along with a host of other elected officials who may just benefit from the funds and/or bonds being approved. See the PSTA Board at this link PSTA Board of Directors.

It's all bit like putting the fox in charge of the hen house.

Section 5. Conduction of Referendum Election. The Board hereby calls a referendum election and directs the Pinellas County Supervisor of Elections to conduct such election in conjunction with the General Election on November 4, 2014, for the submission of a referendum question to the electors of Pinellas County to determine whether a majority of electors voting in the election are in favor of the levy of the Surtax on transactions occurring within Pinellas County as provided by law. Reasonable costs associated with conducting said election shall be paid by the County.

This Section formally calls for the Referendum to approve the sales tax increase and indicates the County will pay for the costs associated with the referendum. 

Section 6. Ballot Title and Summary. (a) In accordance with the Acts, and Section 101.161, Florida Statutes, the following ballot title and summary are approved for submission to the electors of Pinellas County, Florida, for approval or rejection by a majority of the electors voting in the referendum election scheduled for November 4, 2014. The official ballot shall be in substantially the following form:

Title: Levy of Countywide One Percent Sales Surtax to Fund Greenlight Pinellas Plan for Public Transit.

Summary: Shall the improvement, construction, operation, maintenance and financing of public transit benefitting Pinellas County, including an expanded bus system with bus rapid transit, increased frequency and extended hours, local passenger rail and regional connections be funded by levying a one percent sales surtax from January 1, 2016 until repealed, with the proceeds deposited in a dedicated trust fund? 

___ YES, for the 1% sales surtax 

___ NO, against the 1% sales surtax 

This is the actual language you will see on your ballot. 

The Title of this referendum contains the Words Greenlight Pinellas Plan but there is no place in the actual Ordinance you are being asked to approve that specifically assigns or dedicates any specific funds or percentage of funds to the GreenLight plan. The Ballot language was carefully crafted to support the preplanned marketing effort and to mislead voters.

This is the only place these words (GreenLight Plan) appear in this Ballot Language and they only appear one other place the Sales Tax Ordinance.

The objective here is to attempt to tie all of that advertising and information you will be getting in the mail, seeing on TV and reading on the back of PSTA buses supporting this initiative to the ballot referendum.

You will note that the official Ballot Language Summary does not contain the words Greenlight Pinellas or GreenLight Plan.

Section 7. Notice of Election. The Clerk shall publish notice of the referendum in accordance with Section 100.342, Florida Statutes, on the following dates: October 1, 2014 and October 15,2014.

This Section sets the formal Publication Notices that will appear in the legal section of a local news paper, and be posted on public bulletin boards.

Section 8. Notice to the Department of Revenue and Department of State. Upon completion of the referendum election called for in this Ordinance, the results of such election shall be certified in accordance with Chapter 100 and Chapter 102, Florida Statutes, to the Department of State. If it is determined upon certification of the results that the majority of the electors of Pinellas County voting in the referendum election are in favor of the levy of the Surtax, the Clerk shall, within ten (1 0) days of such certification, but in no event later than November 16, 2015, submit a copy of this Ordinance and the certification of the election results to the Florida Department of Revenue. The notice shall specify that the Surtax will go into effect on January 1, 2016, and will be in effect until repealed as provided by law, that a surtax of 1% will be imposed and provide such other information as the Department of Revenue requires by rule. The Clerk shall also provide the additional notice to the Department of Revenue required pursuant to Section 212.054(7)(b), Florida Statutes.

This Section establishes the time frame, notice and actions of the State Clerk who will notify the Department of Revenue and the Tax will go into effect January 1 2016.

Section 9. Severability. If any section, subsection, sentence, clause, phrase, or provision of this Ordinance is for any reason held invalid or unconstitutional by any Court of competent jurisdiction, such holding shall not be construed to render the remaining provisions of this Ordinance invalid or unconstitutional.

This Section is extremely important in this Ordinance given its poor construction. Legal challenges are almost a certainty. Any successful legal challenge to a specific Section of the Ordinance does not affect the remaining Sections.

In other Words, it would require a legal action challenging the entire Ordinance to cause a full repeal if you vote to make this Ordinance a law; something that would be lengthy, costly and unlikely to happen.

Section 10. Inclusion in the Pinellas County Code. The provisions of this Ordinance shall be included and incorporated in the Pinellas County Code, as an addition or amendment thereto, and shall be appropriately renumbered to conform to the uniform numbering system of the Pinellas County Code.

This Section requires that should the Ordinance be approved by voters it will become part of the Pinellas County Code. That means it has the full force of law, and requires significant and often complicated legal action to change or modify it once approved by the Voters.

This Ordinance has been crafted by PSTA to be a broad as possible, with few controls, no reporting requirements and undefined interlocal agreements.

While it appears that the County may be in control, actually do to the overlapping of County Board of Commissioners and the PSTA Board and the number of elected officials whose jurisdictions could or will benefit from the way the sales tax monies are spent and the lack of defined controls; the PSTA will actually be in control.

PSTA will control the money so PSTA Board members who are elected officials could be put in a position of following PSTA suggestions if they want their jurisdictions to be part of the plan.

Section 11. Filing of Ordinance; Effective Date. In addition to the notices to the Department of Revenue as provided herein, pursuant to Section 125.66, Florida Statutes, a certified copy of this Ordinance shall be filed with the Department of State by the Clerk within ten ( 10) days after the enactment by the Board. This Ordinance shall become effective upon filing of the Ordinance with the Department of State.

This Section requires filing of the Ordinance within ten days of enactment by the board, although there is no clear indication of what provisions must be in place for the Board to approve.

Epilog

It is difficult to truly determine if this Ordinance is just poorly written or cleverly crafted to mislead the voters.

Even the most casual reader should begin to see that Ordinance 13- 34, The Sales Tax Referendum, is not about public transportation it is about establishing a large stream of unmanaged tax revenue to an Authority,(PSTA), that is controlled by politicians not directly elected for that purpose and strongly influenced by special interests who stand to benefit significantly from the revenue flow.

This Referendum is not about public transportation, it is all about turning PSTA into the most powerful, publicly funded redevelopment agency ever created in Pinellas County.

Along with its powerful supporters: National, State and Local Association of Realtors, leading financial organizations, Chamber of Commerce, electric Utilities and other major players, all of whom stand to benefit greatly, will be a deep pockets force determined to get their way for decades to come in Pinellas County.

Thank you for taking the time to read through this lengthy Ordinance and my analysis. Please feel free to copy and reproduce this document, link to it and forward it to your friends on social media and via e-mail.

 

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Disclosures: Contributor to No Tax for Tracks