Tax hike recommended as pension solution

[mtraininjax]

http://www.bizjournals.com/jacksonville/news/2014/02/24/tax-hike-recommended-as-pension-solution.html?ana=RSS&s=article_search

Yet once again, the Mayor defers any real solutions or options and has others do his dirty work for him.  If property tax passes, rents are going up!

Solving Jacksonville's pension woes will require some sort of tax increase, the city's pension reform task decided Wednesday, recommending that voters decide if they want an increase in the sales tax or property taxes.
The plan proposed by the task force would have the City Council raise the property tax rate by roughly 1.5 mills, garnering about $68 million. Then, a referendum would ask voters to approve a half-cent sales tax increase, which would raise the same amount.

If the sales tax increases passes, property tax rates would be legally required drop back down. The money from the sales tax would then, basically, be added to the amount of money the city is required to put into the Police and Fire Pension Fund.

Together, that should add up to about $200 million; this year, the city's required pension contribution was about $140 million.

The task force is seeking a way to pay extra in order to more quickly pay off the unfunded liability that has built up in the fund.

The other side of that deal, said task force Chairman Bill Scheu, is that police officers and firefighters must agree to benefit cuts, including lowering the cost-of-living adjustment and contributing more to their pensions.

"We've said that this is a complete package," Scheu said.

The task force didn't buy into Mayor Alvin Brown's plan to have JEA kick in $40 million in extra pension payments.

"Most people don't want JEA as part of a problem they had nothing to do with,"said task force member Bob Shircliff. "They've got their own problems. I don't think we should get them more involved in city problems."

In its recommendation, however, the task force allowed for the possibility of funding sources other than a tax hike, including the JEA funds, a hike in franchise fees and the sale of city property.

One additional source of funding the task force did recommend tapping into what are known as chapter funds, money that comes from state premium tax collections on property and casualty insurance policies.

Some of that money goes to pay for benefits now in place and part of it goes into a reserve fund. The task force recommended using $20 million from the reserves, an amount the Police and Fire Pension Fund had agreed to as part of a deal reached in secret negotiations.

The task force recommendations will be wrapped up in a meeting next Thursday, after which they'll be sent to the City Council and mayor.

[duvaldude08]

Why is he trying to put a band aid on it? Fix the damn pension problem! 

[tufsu1]

Why is he trying to put a band aid on it? Fix the damn pension problem! 

because the Mayor made an unfortunate pledge while campaigning to not raise taxes....and now he does everything possible to meet that commitment.

[tufsu1]

I'm sure he feels he's doing just that Stephen...but maybe you should discuss it with him

[Tacachale]

The mayor knows that being known as the "no taxes guy" will endear him to a lot of people, whether or not taxes actually stay low, so he makes it the one campaign promise he actually sticks to. Not a good way to run a city, but a good way to keep your poll numbers high, though the varnish is fading on that anyway.

[edjax]

I'm sure he feels he's doing just that Stephen...but maybe you should discuss it with him

I will be, TUFSU.  Ill let you know the outcome shortly. But I don't know what exactly you want me to discuss with him....the differences between a campaign pledge and an oath of office?

I am rather of the impression that he is old enough to be able to tell the difference.

^^maybe you should ask him if he knows the difference.  Not sure he really is all that bright. 

[Dog Walker]

Why is he trying to put a band aid on it? Fix the damn pension problem! 

because the Mayor made an unfortunate pledge while campaigning to not raise taxes....and now he does everything possible to meet that commitment.

but he actually swore an oath to fulfill the obligations of the city of jacksonville.  A somewhat higher provenance of commitment.

We have underfunded almost every city function that supports a good quality of life and funded frivolous things instead = 2.  We have underfunded the obligation that we had to fully fund pensions for city worker = 2.   2+2 = 4 (we have to raise taxes and stop funding foolishness)  Simple math.

[carpnter]

Why is he trying to put a band aid on it? Fix the damn pension problem! 

because the Mayor made an unfortunate pledge while campaigning to not raise taxes....and now he does everything possible to meet that commitment.

but he actually swore an oath to fulfill the obligations of the city of jacksonville.  A somewhat higher provenance of commitment.

We have underfunded almost every city function that supports a good quality of life and funded frivolous things instead = 2.  We have underfunded the obligation that we had to fully fund pensions for city worker = 2.   2+2 = 4 (we have to raise taxes and stop funding foolishness)  Simple math.

We also need to stop making promises that we cannot deliver on.  The guaranteed rate of return on the fund was also unrealistic.

[Bill Hoff]

Related....

This website says Jacksonville residents have the least tax burden of any major city in the US:

http://wallstcheatsheet.com/personal-finance-2/taxes/5-major-u-s-cities-with-the-lowest-individual-tax-burdens.html/2/

#1 Jacksonville.

[JayBird]

Related....

This website says Jacksonville residents have the least tax burden of any major city in the US:

http://wallstcheatsheet.com/personal-finance-2/taxes/5-major-u-s-cities-with-the-lowest-individual-tax-burdens.html/2/

#1 Jacksonville.

Just a few things:

Wall St Cheat Sheet  used to just deal with investment news. Since Spring of 2013 they have started trying to get into politics and some national news. Though their investment news is accurate, and I source them a lot, remember that their model is based on churning out 100's of articles a day to increase page views and thus gain ad revenue. It's working and making the brothers who own it very rich but it also leads to a degree of sensationalism.

The study only compared the largest city in each state and the fact that Florida has no income tax skewed the overall numbers.

Still a good article, another reason for people to look at Jax in a good light. Nothing to pop open the champagne and start building hundreds of suburban homes though.

[thelakelander]

I'm not against having our sales tax raised but if we go that route, it should not be in a vacuum. We have so many things that are underfunded or completely ignored because of a lack of funding.  I'd rather see a push for a sales tax increase attempt to fund and address multiple quality of life issues than simply dealing with the pension.

[Kay]

Ditto.

[fsquid]

Related....

This website says Jacksonville residents have the least tax burden of any major city in the US:

http://wallstcheatsheet.com/personal-finance-2/taxes/5-major-u-s-cities-with-the-lowest-individual-tax-burdens.html/2/

#1 Jacksonville.

one of the big reasons I took a position here within the same company.

[edjax]

I'm not against having our sales tax raised but if we go that route, it should not be in a vacuum. We have so many things that are underfunded or completely ignored because of a lack of funding.  I'd rather see a push for a sales tax increase attempt to fund and address multiple quality of life issues than simply dealing with the pension.

Pretty much what Littlepage said in his article today in the paper. Basically lets think of raising the sales tax a full % and fun not only the pension but other unfounded items throughout the city.

[mtraininjax]

With BJP we got the sales tax and new buildings. With this sales tax increase we get ? Oh, we get to pay for the sins of past leaders. Those past leaders would do well to leave Jacksonville before the tar and feathers come out!