City Councilman Bill Bishop, who is running for mayor, said Monday during a forum hosted by the Meninak Club of Jacksonville that putting a half-cent sales tax on the ballot would be the best way to shore up the finances of Jacksonville's pension system.
Bishop prefaced his comments with the adage that there's no free lunch.
"There's no such thing as a free pension, either," Bishop told 109 attendees who got a taste of the pension debate playing out at City Hall.
Sitting next to Bishop at the panel discussion, Chris Hand, chief of staff for Mayor Alvin Brown, reiterated Brown's support for a financing plan that involves the city and JEA borrowing $240 million and paying it up front into the Police and Fire Pension Fund.
Supporters of that proposal say it will enable the city to improve the pension fund's finances without any tax or fee increases. The city would use savings from pension reform to pay off its $120 million in debt, and JEA would pay off its $120 million by getting a reduction in its annual contributions to City Hall.
When panel moderator Melissa Ross, who hosts First Coast Connect on WJCT, asked Hand what the funding source would be if the city-JEA financing deal doesn't happen, Hand said "we're a long way from the hypothetical you describe."
Hand said the proposal with JEA offers upsides to both the city and the city-owned utility because it will help City Hall accomplish comprehensive pension reform while also benefitting JEA's finances.
"This is one of the closest things to a win-win you can see in city government," Hand said.
But Bishop said reducing the JEA's contributions to City Hall would take a toll on the city paying for services that already have suffered in recent years with cuts in police officers, library hours, park maintenance and road repairs.
If the city gets less from JEA to help pay for everyday services, "the money has to come from somewhere else," Bishop said.
The utility's contributions over a 30-year period would be $276 million less under the proposed financing plan, according to city projections.
Bishop said the economy is recovering so tax revenue is increasing, but not fast enough for growth to solve the city's financial problems. He said a sales tax spreads the cost widely among residents as well as those who come into Duval County for shopping.
A half-cent sales tax would generate about $63 million and it would come with an expiration date if voters approved it. But state law currently doesn't allow a sales tax geared specifically toward paying down pension debt. State lawmakers have been cool to the idea so there's nothing in the works to schedule an election.
Former City Councilman Matt Carlucci, one of the panelists at the Meninak Club, said a sales tax should be reserved for big community projects, not pension payments. He helped craft the JEA financing plan and said the economic is coming back strongly.
He said the city is on the verge of getting pension reform done and cannot afford to bog down in "paralysis of analysis" when it's so close. Click link for full story.
http://jacksonville.com/news/metro/2015-01-27/story/bill-bishop-says-sales-tax-best-way-eliminate-pension-woes