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Palm Coast Largely Rejects County’s Economic Development Track, Including New Tax

| January 25, 2011

Even then, Flagler County was little more than a footnote to Palm Coast. (© FlaglerLive) 1970 grand opening ITT

Even then, Flagler County was little more than a footnote to Palm Coast. (© FlaglerLive)

You could have seen it coming from as far off as 1999: Palm Coast is not about to be subservient to any county-led economic development effort.

The Palm Coast City Council on Tuesday shot down three of the most substantial ideas favored by the Flagler County Commission: a sales tax to create a dedicated pot for economic development, an economic development council (or “entity”) with a common fund whose ultimate decisions don’t rest with Palm Coast, or any “one pot” that would collectively pool all governments’ contributions, leaving less or nothing for Palm Coast’s exclusive use: Council members  are unwilling to sign off Palm Coast’s portion of sales tax revenue to that “one pot,”  though they’d be willing to contribute a small share of that to Enterprise Flagler, the public-private economic development partnership—“understanding that Enterprise Flagler is going to need some reorganization and some better direction,” Palm Coast Mayor Jon Netts said.

Without new tax revenue, further discussions of a county-wide economic development policy becomes largely academic.

Almost at the same time, a few miles away, the county commission–in a meeting considerably more productive and less scattered than Monday’s–was putting in writing a “statement of principle” that focused on just such a “common fund” whose final spending decisions would “reside in a body that is agreed upon”—likely a new countywide organization.

In the wake of last year’s failed referendum to raise money for economic development through a higher property tax in Flagler County, local governments and business groups have veered toward raising the sales tax instead. That idea was to be an underlying theme at next Monday’s county-led summit on economic development, where elected officials from every city, the county, the school board and unelected members of the business community will present their plans on fostering more local economic activity and jobs.

That Palm Coast would not support a sales tax increase doesn’t mean it won’t happen. An additional sales tax can be imposed two ways: The County Commission can place the proposal on a ballot for popular referendum, though given recent trends the electorate is unlikely to support it. Last year’s economic development referendum was so bitterly criticized that by the time it had made it to the ballot, its backers at the Flagler Chamber of Commerce and Enterprise Flagler asked the commission to pull it. The results were never counted.

The county commission can also impose an additional sales by super-majority vote—that is, a vote in favor of the tax by at least four of its five members. Either decision rests with the county commission, not the city. The resulting dollars, should a new sales tax make it, would then be distributed by proportionately among the cities and the county, though the county is proposing that a proportion of the money would be pooled collectively and administered by that “body” to be agreed upon.

Flagler County’s “Statement of Principle”:

  • The Flagler County Commission on Tuesday agreed to the following preamble to its economic development vision. The text was written by County Attorney Al Hadeed:

    “Economic development is a countywide concern and requires concerted, strategic action. The governments of the County will agree to the creation of a common fund that will be administered according to agreed upon plans and criteria. The common fund will be administered by a representative body of all the governments. The professional staffing to support the common fund will be managed by an agreed upon public – private entity that is financially supported by the common fund, among other funding sources. Final decisions for spending the common fund shall reside in a body that is agreed upon. All governments are eligible for funding of individual projects that are approved under this system.”

So Palm Coast withdrawing its support for a sales tax doesn’t defeat the idea. But it diminishes its legitimacy—both as a referendum and as a super-majority vote, since the government representing the county’s largest population base would end up with an imposition it does not endorse. It wouldn’t be good politics. But it may still happen.

“This discussion is kind of convoluted because you don’t know whether you’re going to have the dollars or not,” City Manager Jim Landon told the council once it was clear the council itself wouldn’t be behind the tax idea. “I think you can send the message to county commissioners that if they think the half-cent sales tax is a good enough idea, they’re going to pass it, then we obviously would work with them on working out the details. Then you can say that you all have different opinions individually as to whether the half-cent sales tax is good or not, but that as a group you need to come together as to if they do pass it, how it’s best to be spent, I guess, for Palm Coast.”

The city has a plan of its own, but it’s largely focused on the city, it would be carried out by the city, for the city, with few to no tendrils extended to the county or other municipalities. And right now, that plan does not entail enlarging the city’s economic development budget. There are small-scale, low-cost projects, such as the city’s post-card marketing to absentee homeowners or landlords, in hopes of encouraging them to return and build. There’s a revitalization plan for older neighborhoods. There’s a focus on special events. But nothing large scale. “That’s certainly the cleanest and the easiest,” Netts said of the  approach that would, for Palm Coast, essentially keep things as they are.

Palm Coast will present that plan Monday, but while discussing it for more than an hour today, it proved easier for council members to say what they did not want to see in a county-wide economic development blueprint—at least none involving Palm Coast—than what they’d be happy with. In that sense, they skirted the county’s pitfalls, evident in meetings on the matter Monday and Tuesday, where commissioners tried to define too precisely what sort of structure they saw undergirding the county’s economic development future.

Commissioners have frequently referred to the Tourist Development Council as their model—a council with a representative from each local government (except Bunnell) and several tourist-industry representatives. The TDC’s decisions are advisory only. The county commission must ratify them to take effect. City Council member Mary DiStefano is a member of the tourist council. She’s also the city council’s most vocal opponent of following that model, which she doesn’t like. “I personally don’t want to see an economic development set-up with that kind of a group, and we’re not having a strong input,” DiStefano said. “It doesn’t make sense.”

DiStefano was also adamant: no higher property tax and no sales tax to fund economic development. At first she sounded like the lone voice on that score, but council member Frank Meeker eventually joined her, and by the end of the meeting Mayor Netts, who tried through various means to find a middle ground closer to the ideas of a common pot and broader decision-making, was himself conceding: “The sense of council is that we’re not particularly interested in adding another tax on people at this time.”

Netts summed up the Palm Coast principles he’d present on Jan. 31 this way: “There are things we can do without spending taxes. By golly, I’ve heard that message real clear from the world. Do more with less. Or do less. You certainly don’t have to do more. So, here’s what we plan to do: we’re going to do as much of this as we can out of our own resources. There are certain areas where we’re going to ask for partnerships, but we’re not asking the partners to bring in money necessarily, just their efforts.”

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5 Responses for “Palm Coast Largely Rejects County’s Economic Development Track, Including New Tax”

  1. lawabidingcitizen says:

    I have been asking in vain: Where are the economic gains from previously spent millions of tax payer moneys spent on economic development by Palm Coast, Flagler Beach and/or Flagler County?

    In vain, because tax payer moneys have been spent in vain, i.e., moneys expended have far exceeded any relief to tax payers realized.

    Let the county and the cities stick to their knitting and leave economic development where it belongs — in the private sector.

  2. palmcoaster says:

    Right now I am very satisfied with our city officials approach to refusing any idea of additional taxes ad valorem or sales. Like I pointed before we have 67 counties in Florida and only five of them have a 7.5 sales tax. All the others have 7, 6.5, 6.25 and 6 sales tax only. Something do not make sense here. Flagler with the second highest unemployment of all counties in Florida and at the same time looking into imposing the six highest sales tax as well? Just across our county lines Volusia has a 6.5% and St. John 6% , then what could make us believe that any of our residents will buy major items like cars, in Flagler if any further tax increase will materialize. Sure will not help our local businesses, jobs creation or residents finances. Enterprise Flagler needs transparency and publicly disclosed financial’s as is mostly public funded. Also our local governments will create hundreds of jobs by granting government contracts to local businesses and suppliers, that pay taxes in this county, employ county labor and rent local commercial space. Do not come up with the excuse that few hundreds saved in thousands of dollars in contracts will increase the budgets and our taxes. Outsourcing is what creates the need for increment in taxes like the proposed and failed “sales tax increase” One last suggestion, use the clause for any developer and or business attracted to open doors in our county by means of tax incentives, relocation help and any other special benefit, that in exchange they need to use labor, supplies and machinery “local” first. All these years I witness all developments utilizing man and machine from elsewhere while ours seat idle. Maybe the time has arrived for all greedy outsourcing to end in order to recoup our jobs and benefit most, not just the elite in charge.

  3. frank says:

    let see, the city of palm coast killed the referendum because it wasn’t specific enough. The city of palm coast kills the county plan because it is too specific.

    Please just say it and quit wasting the community’s time. The city of palm coast is a retirement city and doesn’t want jobs. (Just the olive garden type jobs).

    “Do more with less. Or do less. You certainly don’t have to do more.” this is the city of palm coast position when we have the highest unemployment in the State! Can we get some new leadership in the city.

  4. Robbie says:

    Frank says.
    You are correct with your statement about the leadership, at least in my opinion.
    Election time is coming so there will be at least one new face, although there should be more.
    On the other hand changing faces may not be enough. The root of the problem in the city is the style of government. There should not be a town manager. And in this case one whose salary is higher than mayors of very large cities. The town council members have stated that the town manager is worth every penny and is doing a splendid job. How splendid of a job can the town manager be doing in a city whose finances were average, as per the last audit.

    The city should have a strong mayor who is elected by the citizens and serves at the pleasure of the citizens. A town manager serves at the pleasure of the town council; they select and set the salary of the town manager. A Four year term for councilors is too long. Three years with two terms allowed. That may be too radical for this town of people set in their ways. So the first step is to change the faces of the town council. Three new faces can certainly do no worst and may bring some fresh ideas to the table. Something has to change, more of the same is no change.

  5. palm coastie says:

    Why don’t we try and save money In other ways , like why do we have 4 separate fire departments in Flagler County wouldn’t consolidation save a lot of money and provide a better service for all ?

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