Why We Must Pass Both Tax Referenda: The “Numbers Don’t Lie” Redux

The above video contains my complete comments on the lack of taxation. Please watch for context for what is detailed below.

It is no secret that school districts all across the Sunshine State have been forced to squeeze blood from a stone by the Florida Legislature for over two decades, and especially since the Great Recession. As noted in the first “Numbers Don’t Lie” piece, Florida went from 27th in per-pupil spending in 1998 to 44th in 2018. Had we kept pace with inflation alone from 20 years ago, Florida would need to spend $9,913 per student. Instead, we currently spend $7,408.

But it’s far worse than simply not keeping pace with inflation. When Ernest Hooper and I were interviewing candidates at the Tampa Hob Nob a few weeks ago, HD64 Rep. Jamie Grant–by his own admission–stated that the three areas of the economy that have actually outpaced inflation were health care, higher education and K-12 education. This effectively compounds the problem, because not only has the Florida Legislature refused to make a meaningful investment in public education, their decision to be parsimonious has made the reduced spending power of those scant dollars that much more signficant (assuming his statement is true).

Hillsborough County is not the only county seeking tax referenda. It’s happening all over the state, which John Romano wrote about recently in the Tampa Bay Times. Going back to this past March, citizens of various counties are 12 for 12 in voting for some type of tax referendum to support their schools. Clearly voters are starting to understand that Tallahassee has gotten us all into these messes because of its ideological zeal for reducing taxes.

IMG_2267
The Great Taxation Paradox: No one wants to pay, yet we need the services they provide.

People who stand against the tax referenda do so for two principal reasons: 1) they claim “we’re taxed too much already”; 2) they believe Hillsborough County Public Schools has mismanaged its funds. Let’s examine these claims in detail:

“We’re Taxed Too Much Already”

Regarding the first claim, this is typical response from just about anyone when the subject of raising taxes is mentioned. The facts, however, do not support this claim. If anything, we are taxed too little in a state that is experiencing such rapid population growth. The lack of taxation is directly linked to: the unwillingness to investment in public education by the Florida Legislature, resulting in students and staff sweating in schools; the traffic congestion we get caught up in on a daily basis; why Hillsborough County Sheriff’s Office has one of the lowest deputy-to-citizen ratios in the state, etc. Simply put, there’s not enough money to go around.

Mitch Perry’s excellent piece in The Florida Phoenix last month detailed why so many counties are seeking various school and transportation referenda and, most notably, linked this report that highlights two key facts that were addressed during my comments to the school board:

1. Florida ranks 49th out of 50 states when it comes to “tax burden” (i.e. per-capita tax revenue generation).

2. Hillsborough County ranks 52nd out of 67 counties in Florida, which means we have the 15th lowest tax burden in the second lowest state in the U.S.

To say that “we are taxed too much already” is a preposterous statement that clearly ignores these facts and traffics in hyperbole when one considers the actual numbers.

HCPS Mismanages Its Funds

When it comes to the second claim about HCPS mismanaging its funds, it must be addressed in two parts. First, there are the optics of some of the board’s more questionable spending decisions over the last three years. Many critics often cite spending nearly a million dollars on the Gibson Report, nearly a million dollars for new school board offices/relocation of Human Resources from its original location to the Instructional Services Center, remodeling/refreshing the audio-visual equipment in the board room, etc. All told these items add up to perhaps $3 million across the last three years, which amounts to approximately 0.00033% of its total annual budget per year.

This is clearly a case of picking out a few trees while missing the entire forest.

Fiscal Stewardship
It took many painful cuts to get to this point, but Hillsborough citizens should be reassured that HCPS is doing its best with what little funding it receives from both state and local sources.

In truth, however, Hillsborough County Public Schools has done a great job of reigning in its deficit spending during the same period. This fact is all the more amazing when one considers the significance of this in light of continually declining purchasing power when dollars are adjusted for inflation. Many citizens of the county, for instance, may not realize that there has been a sharp reduction in “PECO” funding (Public Education Capital Outlay, the source that pays for installation and maintenance of HVAC systems, building and repairing schools, upgrading technology, etc) for several reasons:

1. At the onset of the Great Recession in 2008, the Florida Legislature–the governing body that effectively caps the tax rates that can be applied by school boards–reduced the millage rate from 2.0 to 1.5. Despite the economy recovering and now thriving, Tallahassee has never raised the millage rate back to pre-recession levels.

2. In addition to the millage rate never being restored, outgoing Speaker of the House, Richard Corcoran, famously quipped “Hell, no” in 2017 when asked if the Legislature would leave tax rates alone and allow rising property values to raise additional funds for education. Despite the Senate being okay with such a sensible compromise, the Grover Norquist anti-tax zealots in the House held firm and rolled back the rates even more.

3. Much of the revenue generated for PECO comes in the form of utilities taxes, including landline telephones, which hardly exist outside of businesses any longer. Therefore, a lot less money is going into those particular coffers at the state level.

Put this all together and what we get is a perfect fiscal storm that looks like this chart.

Capital Funding History
And people wonder why there is no money to fix A/C or otherwise repair our schools

While no one ever likes paying taxes, I would argue that there is a cost of paying too little. Having lived in Florida for just over 20 years now, I have watched our schools deteriorate and our roads fall apart while simutaneously becoming more clogged thanks to two decades of rampant, unchecked sprawl that has had little oversight and even less funding devoted to overcoming these challenges. I would highly encourage anyone who is reading this and lives in Hillsborough County to share this information with friends/family and vote for both of these referenda so that our citizens no longer have to live with the disastrous decisions being made by the Florida Legislature.

Furthermore, especially when it comes to the school district referendum in particular, please bear the following in mind: 1) the referendum can only be used for capital expenses; 2) there will be an oversight committee comprised of six citizens who have no connection to the district and will oversee how the money is spent on projects; 3) for the average Hillsborough citizen, the additional tax will mean about 17 cents per day. Undoubtedly, there will be naysayers who still want to vote no for their own personal reasons regardless of these facts. To them I paraphrase Voltaire by saying we cannot let the perfect be the enemy of the good.

Our students, our schools, and our future depend on it.

Referendum Details
For more details, click here.

 

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