Jax pension tax bill passes 2nd major House hurdle

Jax pension tax bill passes 2nd major House hurdle

Florida Politics

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The Florida House held a second reading Tuesday of Jacksonville’s “pension tax” bill, which would facilitate a referendum to extend the current half-cent sales tax 30 years and devote it to paying off Jacksonville’s $2.6 billion of unfunded pension liability.

The debate before the full House went well.

Going into the House session, those familiar with the lobbying effort expressed optimism as it was headed into the second reading, where it was expected that Rep. Travis Cummings‘ amendments to what he called a “pension liability surtax” would be considered, as well as some counters.

Cummings, an Orange Park Republican, noted that since 2003 the city’s contribution has gone from $9.7 million to $153 million, and unsustainable situation.

When Rep. Mark Pafford asked about raising the city’s property tax rate, Cummings noted that while that is “Plan B or C” he was troubled by the lack of voter referendum for a millage increase and of accountability. He also noted that the property tax rate went up 14 percent a few years ago.

The tax generates “about $60 million a year” now, according to Cummings. The surtax would sunset immediately if and when the pension funding level hits 100 percent.

Rep. John Tobia, a Melbourne Beach Republican, noted the “terrible decisions the city has made in the past,” by way of expressing skepticism over the 100 percent funding target … which Jacksonville is a long way from.

When Rep. Paul Renner asked about other approaches considered, Cummings noted that a City Council supermajority, previously considered in early iterations of the idea, didn’t allow for voter input into the decision. Cummings also said that “leadership provided by former City Council President Bill Gulliford” is moving the collective bargaining burden to the unions and away from the Police and Fire Pension Fund.

An amendment provided Tuesday reinforces the separation of the PFPF trustees from collective bargaining. Another part of the amendment mandates a 10 percent contribution from all employees. The Jacksonville ordinance now requires any new employee who started after June 19, 2015, to contribute 10 percent of pay. On the same day current members went immediately from 7 percent to 8 percent. They will go from 8 percent to 10 percent when the previous pay cuts are restored, according to the current plan. There was no word from Cummings as to whether a pay raise will be a precondition of final union acceptance of this package.

“It could go up, but it could not go beneath 10 percent,” Cummings said, noting that city employees do not pay Social Security.

The amendment was adopted via voice vote acclamation. The bill next moves to the third reading before the full House where it will be voted up or down.

A concerted lobbying effort has gone into pushing the bill, from Southern Strategy Group, Ballard, and the Fiorentino Group, whose Marty Fiorentino has quarterbacked the city’s lobbying effort this Session. Jacksonville Mayor Lenny Curry has made many trips to Tallahassee in the past couple of months to personally buttonhole members of the House and the Senate.

Likewise, co-sponsors from Jacksonville and beyond lined up behind Travis Cummings, who has done the heavy lifting in the House, including Reps. Lake Ray, Jay Fant, Charles McBurney, Cyndi Stevenson, and Charles Van Zant.

“And we’re good,” one lobbyist said. “Another barrier down in the House.”

The Senate companion bill moves on to the Senate’s Rules Committee on Wednesday morning.

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