Gulliford wants voters to decide on half-cent sales-tax to pay down pension

[Chris Hand]

Chris, first, welcome to MetroJacksonville.
It would be more efficient to email the PowerPoint and the White Paper to MetroJacksonville
metrojacksonville@metrojacksonville.com

or to the thelakelander through MetroJacksonville.  I would just send them what you sent me.

Will do. Thanks very much.

[vicupstate]

^^ what difference does it make now? So we can point fingers? It is what it is now so we just need to deal with it.

The difference is those that got the 'break' need to be the ones that pay more now. Sales taxes hit renters for instance but they didn't get the tax break on property taxes.

As for pointer fingers, if the situation panned out as I suggested, it provides a great example of why cutting taxes can just come back to bite you later. Something to think about in this current political climate.

[vicupstate]

Mr. Hand, thank you for your informative input.

Can you explain why this is true:

Second, under the current COJ-JEA agreement, the annual JEA contribution will drop from approximately $111 Million now (Fiscal Year 2015) year to approximately $82 Million in Fiscal Year 2017 if the City and JEA cannot reach a new agreement.

Why is the JEA reducing it's contributions to begin with?

Because I believe their contribution would revert back to a percent of revenue instead of the set amount they are required to make under the current agreement.

EdJax is correct, and JEA Paul McElroy said as much at Tuesday's special committee meeting on the JEA Agreement. Under the COJ Charter, our current contribution agreement with JEA ends on September 30, 2016. If a new agreement is not in place by then, the contribution will revert to the millage/revenue formula set forth in the Charter. That formula would produce an annual contribution of approximately $82 million.

So in addition to a ballooning pension problem, the city will be facing reduced revenues from JEA no matter what. Meanwhile property taxes revenues are still down from the R.E. bust.  It sounds like more budget cuts lie ahead.     

[edjax]

^^ what difference does it make now? So we can point fingers? It is what it is now so we just need to deal with it.

The difference is those that got the 'break' need to be the ones that pay more now. Sales taxes hit renters for instance but they didn't get the tax break on property taxes.

As for pointer fingers, if the situation panned out as I suggested, it provides a great example of why cutting taxes can just come back to bite you later. Something to think about in this current political climate.

At this point it needs to be a shared sacrifice by all, renters and property owners alike.  One can probably say the property owners do most of the heavy lifting anyways with regard to taxes. 

[coredumped]

At this point it needs to be a shared sacrifice by all, renters and property owners alike. 

All but the people receiving the money? Where is their sacrifice?

[CityLife]

^^ what difference does it make now? So we can point fingers? It is what it is now so we just need to deal with it.

The difference is those that got the 'break' need to be the ones that pay more now. Sales taxes hit renters for instance but they didn't get the tax break on property taxes.

As for pointer fingers, if the situation panned out as I suggested, it provides a great example of why cutting taxes can just come back to bite you later. Something to think about in this current political climate.

At this point it needs to be a shared sacrifice by all, renters and property owners alike.  One can probably say the property owners do most of the heavy lifting anyways with regard to taxes.

I disagree with the notion that renters do not pay property taxes. Property taxes are typically somewhat factored in to rent paid, whether residential or commercial. Only real difference imo, is that renters can't write the property taxes off their federal income taxes. However, without the mortgage interest deduction, most likely take standard deductions anyways.

[vicupstate]

If the property tax cut for the owner was not passed onto the renter, I don't see how the renter benefited.  If the pension burden was previously carried by property taxpayers and that burden was reduced when it shouldn't have been, why shouldn't the cut be reversed?  What that doesn't cover should be shared sacrifice perhaps.   

[strider]

Strider, respectfully, this administration has made important improvements in local government transparency. Here's information about some of the work we have done through our Office of Public Accountability to give citizens better access to the City of Jacksonville.  http://www.coj.net/welcome/featured-news/city-website-scores-highest-in-state-for-governmen.aspx

Respectfully, my lawyer has made good money off the lack of transparency. Transparency is not just putting out there what you happen to want the public to see and believe, it is truly allowing complete access to the information the law says we are entitled to.  That has, more often than not, been difficult and often all but impossible since this administration took office.  If it is better today, it is only because it has cost you...OK, cost us as the money paid out came from us out here to pay for the administration's error in judgement.

[Cheshire Cat]

If I'm not mistaken, this hit a fever pitch around FY11/12/13 did it not?  There were task forces, meetings, commissions,etc.. to try and get to the root of the issue. 

Were ANY of the proposals then implemented?

I guess this is where I stand on the issue:  Now that we're entering yet another election cycle, the PFRPF (sic) is getting brought back to the front of discussions, but has there been any movement, positive or negative, at all or are we pretty much exactly where we were this time last election (resolution-wise, not $$$-wise) on the issue? 

Short answer is there has been no real or meaningful progress on the pension issue in spite of some hopeful soundbites from the mayors office and we will likely see non before the election.
Actually, this issue hit a fevered pitch during Peyton's second term in office where he effectively put himself at odds with the JSO and JFRD who had helped put him in office.  He failed to resolve it and the hot issue was carried forward into the next election cycle.  Three and a half years later, under Brown the issue is still unresolved.

Cheshire Cat (Diane), with all due respect, that statement about "no real or meaningful progress" simply isn't the case. Thanks to a lot of hard work from Mayor Brown and our administration, City Council, the Police and Fire Pension Fund, public safety employees, the 17 members of the Jacksonville Retirement Reform Task Force, the Pew Charitable Trusts which supported the Task Force, and a variety of other community leaders such as the Jacksonville Civic Council, the COJ is closer than ever before to a comprehensive pension reform solution. in December, the Jacksonville City Council for the first time enacted pension reform legislation. The Police and Fire Pension Fund accepted most of the Council amendments and made a relatively small number of revisions to the tentative agreement between the COJ and PFPF. On a very complex financial and operational issue, we're down to a very few issues. That is huge progress.

If you will email me at chand@coj.net, I would be more than happy to send you our latest Power Point presentation showing you just how far Jacksonville has come on this issue in the last 2.5 years. Jacksonville could soon be one of the leading examples of a community that has addressed the single biggest financial challenge facing many cities, counties, and states across the nation: the cost of public pensions.

In reply with all due respect Chris I would disagree about there being any "huge" progress and your solutions to date are minus needed council support. Meaningful progress to me will be when this administration can get a sound proposal through the City Council.  There have been innumerable claims about progress on this issue for the last few years and yet the issue remains un-resolved.  You and the administration have been at this for 3 1/2 years now and we have heard all sorts of suggestions from borrowing money to the mayor trying to muscle the JEA into an agreement.  I would welcome a review of your proposal and will send you my email address. 

[Cheshire Cat]

To keep everyone updated with regard to how the political football that is the "unsolved pension issue" is being played.This just a few days back.

The first negative mailpiece of the Jacksonville mayoral election is out, and it's a rhetorical masterpiece, distilling many of the themes Lenny Curry and his adherents have advocated in recent months into a hard- hitting two-sided document that lays singular blame at the feet of Alvin Brown for what the mailpiece dubs a "pension disaster."

The address side of the mailpiece has a grid of headshots, a stockphoto cross-section of 21st century American humanity, with a stark message overlaying the pictorial:

"$1,700,000,000.00 in unpaid pension benefits... with no end in sight. Alvin Brown's Pension Disaster Hurts All of Us."

The flipside contains support for this claim.

"Democrat Mayor Alvin Brown's Political Malpractice Is Hurting Us," says the top of the card, next to a first-responder troika of a policeman, a fireman, and a nurse, all with intense expressions on their faces. Then, below that, the damning quotes from a cross-section of local media. Quotes from the two highest rated television news operations in the local market, juxtaposed with selections from print outlets ranging from the local alt-weekly to the Jacksonville Business Journal, lambasting the mayor for inaccessibility, pension problems, credit downgrades, and borrow and spend economics.

"Alvin Brown hides from big issues, plays political shell games," continues the polemic. "Alvin Brown has made a mess of things in City Hall, because on the most important issues Brown is all politics – and no leadership. Brown's pension plan makes no sense – borrowing money to pay unpaid bills?!"

The "Pension Disaster" costs each adult over $2,500, continues the document, which concludes as follows:

"Who suffers from Alvin Brown's Political Malpractice? All of us. Democrat Alvin Brown's Pension Disaster: A $1,700,000,000.00 shell game he's playing with all of us."

All of the expected themes are there, ranging from the Rummell "competence" critique to the general complaint among the news media that the mayor is not accessible when it comes to addressing hot-button issues. Local Democrats were quick to counter the mailpiece's claims, saying it belied the branding that Curry is "not a politician," and was a vessel containing "shameless, bold-faced lies about who created this pension problem."

"It is interesting that a Political Action Committee, which is supported by members of the Civic Council, is attacking Mayor Alvin Brown as fiscally irresponsible for borrowing $240 million from JEA when it was the Civic Council that suggested borrowing $1 billion," maintained James Poindexter, secretary of the Duval Democratic Party, who added that "A bipartisan group of business and political leaders, as well as the pension task force, believe that this is the better option to solve the problem."

Click link for full article:


http://www.saintpetersblog.com/archives/175470

[edjax]

^^ what difference does it make now? So we can point fingers? It is what it is now so we just need to deal with it.

The difference is those that got the 'break' need to be the ones that pay more now. Sales taxes hit renters for instance but they didn't get the tax break on property taxes.

As for pointer fingers, if the situation panned out as I suggested, it provides a great example of why cutting taxes can just come back to bite you later. Something to think about in this current political climate.

At this point it needs to be a shared sacrifice by all, renters and property owners alike.  One can probably say the property owners do most of the heavy lifting anyways with regard to taxes.

I disagree with the notion that renters do not pay property taxes. Property taxes are typically somewhat factored in to rent paid, whether residential or commercial. Only real difference imo, is that renters can't write the property taxes off their federal income taxes. However, without the mortgage interest deduction, most likely take standard deductions anyways.

I agree they do and I never said that renters did not contribute to property tax revenue, I said that actual property owners do most of it, which I still think is the case.

[Cheshire Cat]

Why it all fell apart for Brown back in 2012

In Alvin Browns words:  "I believe the current system should stay. Needs some tweaking, but I believe in strong pension system," said Mayor Alvin Brown while campaigning in 2010

Alvin Brown after election:  "City declares impasse with FOP While Brown was running for mayor he was captured on video saying that he wanted a strong pension system, one that he now wants to cut $1.5 billion from over the next 30 years".

Click link for full story.

http://news.yahoo.com/fop-mayor-broke-pension-promises-041338916.html

[Cheshire Cat]

There is no confirmed deal on the pension nor any "huge" developments, just a new and questionable plan.  The current Brown deal has yet to pass muster with the full JEA board which must vote on the deal or the city council for that matter.  This article just posted days ago goes into more detail. 

While getting JEA back on board has removed a potential unforced error by Brown on pension reform, he will still face a tough sell with City Council members

http://jacksonville.com/news/2015-02-05/story/jea-back-board-mayor-brown-pension-reform-plan

[Cheshire Cat]

City Council member Bill Gulliford put the wheels in motion Tuesday for a referendum asking voters to approve a half-cent sales tax to reduce the city's pension debt.
Gulliford introduced the legislation with the aim of having Jacksonville voters decide the matter in the May 19 general election.

The need for pension reform is dire and needs an abrupt resolution, Gulliford said."This will frame a community debate by virtue of the required referendum," Gulliford said. "If there are other options, I'd like to hear them. If not, folks, we need to take action. Our future depends on it."

He said the only other viable option for cutting into the city's massive public employees' unfunded pension plan liabilities is a property tax increase.

"Doing nothing is not an option," he said. "There has been a lot of talk, but, thus far, no action on funding. And the hole gets deeper as each day passes, sapping the strength from future budgets."

A half-cent sales tax would raise an estimated $60 million annually. The city's mounting pension liabilities amount to about $1.62 billion from the public employees' plan and nearly $1 billion from the general employees' plan.

Gulliford says tackling the pension debt with a sales tax hike is more equitable than a property tax increase or having JEA ratepayers help take on the liability, as proposed by Mayor Alvin Brown.

"The JEA option is questionable," Gulliford said.

For a sales tax referendum to be presented to voters, the Legislature would first have to agree to put it on the ballot. While Gulliford says he thinks it is likely voters would approve the measure, state Rep. Janet Adkins, the Duval County Legislative Delegation chair, says obtaining Tallahassee approval for pension-related legislation would be an unlikely political hurdle to overcome.

A public hearing on Gulliford's proposal is slated for Feb. 24. Although no other council members spoke on the measure, council member John Crescimbeni has said he supports having voters decide whether to pay down the pension deficit with a half-cent sales tax.

JEA is considering a Brown-backed proposal to borrow $120 million to help reduce the pension fund liability in exchange for establishing a JEA employee retirement plan separate from the city, among other concessions.

For more of this article click the link:
http://jaxdailyrecord.com/showstory.php?Story_id=544870

[tufsu1]

In reply with all due respect Chris I would disagree about there being any "huge" progress and your solutions to date are minus needed council support. Meaningful progress to me will be when this administration can get a sound proposal through the City Council. 

Diane...the administration and Council did agree on a sound proposal.  Unfortunately the Pension Board rejected it.