MANATEE COUNTY — As a trust fund to pay for indigent health care in Manatee County nears depletion, Manatee County officials will take to the public a proposed half-cent sales surtax — a tax that potentially would result in the reduction of property taxes.
A referendum is scheduled for June 18.
After two motions failed — one to hold the referendum in November, and another to deny the proposed ordinance allowing the referendum — members of the Manatee County Board of County Commissioners voted 4-3 March 12 to put the proposed tax on the ballot this summer.
The county currently spends more than $24 million annually on health care-related costs, of which about $9 million is paid for through the trust fund and the remaining $15 million is funded through property-tax revenues.
Officials plan to replace the county’s expenditures of $24 million, to the extent possible, with proceeds of the tax — a move that will free up property-tax revenue for a property-tax reduction. Officials also plan to reduce indigent health-care costs by redirecting patient care from emergency rooms to less-expensive clinics.
“Our proposal is to swap property tax-funded expenses for sales tax-funded expenses, reduce tax rates and, if the Feds come up with a funding (mechanism) to replace the sales tax, we eliminate the sales tax,” Manatee County Administrator Ed Hunzeker said. “The sales tax revenue can only be used for health care — nothing else according to state law.”
Under the current proposal, property-tax revenues could be reduced by about $10 million annually. The sales tax, which would be charged for items costing less than $5,000, would cost many middle-class families about $64 annually.
The tax would go into effect Jan. 1, 2014.
Despite approving putting the referendum on the ballot, commissioners still have the option of canceling the referendum, if details of the sales-tax proposal come back as unfavorable.
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To qualify for use of the indigent-care dollars under the proposed tax, individuals would have to be residents of Manatee County, have no insurance, be unable to qualify for Medicaid and earn up to 200% of the federal poverty level. Individuals would be eligible for up to 12 months.
March — Commissioners vote
to put the half-cent sales tax on the ballot.
June 18 — Public
votes on the proposed tax.
October — If approved, tax would
January 2014 — Collection of the sales tax would begin.
Manatee County residents came forward both for and against the proposed tax.
Opponents objected to funding preventative care and having an “open-ended” financial commitment, as well as a lack of data to measure the effectiveness of how dollars now are spent.
Proponents liked the idea of property-tax relief, because the tax would shift the burden of indigent care to the entire community.
Despite the motion to go forward with the referendum, Manatee County commissioners said they were not completely comfortable with the idea of the sales tax. The timing of the referendum, in particular, raised many concerns.
“We need to find another way to fund what we already are doing,” Commissioner John Chappie said. “I’m in favor of moving it forward, but I am concerned about the timing.”
Pushing the referendum to November, county staff said, would delay the collection of the tax. However, a June referendum would allow the county administrator to present a budget proposal that includes a property-tax reduction to offset the sales tax.
Commissioners also raised concerns about the uncertainty of federal health care-related legislation on local governments. They also wanted to study the issue more closely before sending the sales tax to the public for consideration.
“I don’t want the people of Manatee to spend any money that’s not absolutely necessary,” Commissioner Vanessa Baugh said. “I’m not convinced we need to move so quickly.”
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