Seminole agrees to hike taxes on gas, utilities
Seminole County will soon add five cents to the price of every gallon of gas sold in the county, a move made to help fill a multi-million dollar hole in the county’s budget and to pay for the increasing costs of mass transportation.
Commissioners also agreed on Tuesday to hike Seminole’s public service tax on water and electric bills in the unincorporated areas from the current 4% to 10% to help pay for the sheriff’s office, fire department and parks.
Per state law, the tax increases required a supermajority vote — or at least four of the five commissioners voting in favor. Commissioner Bob Dallari was the only commissioner to vote against both increases.
The tax hikes on gas and utility bills come just a month after commissioners decided to raise the countywide general property tax rate for the first time in 16 years from $4.90 per $1,000 of a property’s taxable value to nearly $5.38.
Commissioner Amy Lockhart joined other commissioners in saying the increases are not pleasant but necessary because of the increasing costs of providing services to residents. She added each commissioner is a resident who also will have to pay the higher levies.
“We are not somehow on a high horse. We are down in the trenches with all others,” Lockhart said. “We understand how impactful this is to residents. We do not take it lightly.”
Seminole faces a $34-million budget shortfall as the county grapples with inflation, rising insurance costs and increasing salaries for public officials — including for sheriff’s deputies and firefighters.
Without an increase in revenue, the county would have to dig into its reserve funds again next fiscal year, officials said.
Commission Chair Jay Zembower said the county may not be able to rely on FEMA funding if a hurricane or other disaster strikes Seminole County because of federal cuts. That makes shoring up the county budget all the more important.
“We’re down to a point that our reserves are in such a position, that we may find ourselves in a pretty bad place if we don’t do something,” Zembower said.
State law allows counties to add a “local option fuel tax” in penny increments up to 5 cents a gallon of gas. The tax would not apply to diesel fuel or electric vehicles.
Seminole, Orange and Lake counties currently do not have such a tax. However, Osceola and Volusia counties have levied the full 5 cents for years.
The extra nickel on a gallon of gas would cost the average driver, using 48 gallons a month, about $24 a year if they purchased all of their gas in Seminole, according to county documents.
It’s estimated to generate about $8.8 million next fiscal year. After being divided among Seminole’s seven cities, the county would receive about $5.5 million.
The funds only can be used for construction of new roads, resurfacing of paved roads, and the operation and maintenance of mass transit — including SunRail commuter train, Lynx bus system and the new microtransit service Scout.
Seminole has budgeted just over $12.1 million to pay for the county’s share of SunRail next fiscal year.
In addition, Seminole’s new microtransit service Scout — which will replace most Lynx bus routes — is scheduled to begin door-to-door service Oct. 1. The cost to the county for Scout would be between $5 million and $8 million annually, depending on the number of vehicles used.
Last November, Seminole voters approved an extra cent sales tax, which is expected to generate $48 million this fiscal year. But that revenue can only be used to improve roads, build trails and for storm water projects. It cannot, however, be used to pay for mass transit, county officials pointed out in support of the gas tax.
Raising the public service tax to 10% on every monthly water and electric bill in the unincorporated areas would generate an estimated $12 million next fiscal year for the county’s general fund, which pays for Seminole’s day-to-day operations, county officials said.
The average monthly electric bill for residents is about $200. The new fee would hike that bill by $9 after certain exemptions. The average monthly water bill for unincorporated residents is about $90, based on 4,500 gallons, and the new tax would raise it by $5 per month after exemptions.
Orange, Lake and Volusia counties currently charge 10%, and Osceola charges 8%. Seminole cities decide on their own levies and all charge 10%, except Altamonte Springs at 8%.
Sanford resident George Sellery said the utility tax hike will hit lower-income people hard because private utilities — including Duke and Florida Power and Light — are considering rate increases. He urged commissioners to exempt the first 500 kilowatt hours of electricity from the tax.
Richard Creedon, president of the Geneva Citizens Association, spoke out against the increases, which take effect Jan. 1.
“The county has done almost nothing in its proposed budget to meaningfully cut spending,” he said. “You need to budget spending in order of projected revenues. …But the problem is the county doesn’t want to make the necessary decisions to cut spending.”
Dallari did not comment on why he voted against both tax increases. But he referenced comments he made last spring, when he said the county needs to find more efficiencies in its budget and spending.