After Joint Meeting, Palm Coast and the County Remain Far Apart Over Sales Tax Renewal

Earlier today most of them were all smiles—and all stomachs—breaking bread together in a celebration of the new Panera on State Road 100: Palm Coast City Council and Flagler County Commission members, including Jon Netts, Palm Coast’s mayor, and Barbara Revels, who chairs the commission, and scattered politicians from other local governments. They glowed in the success of a popular new restaurant, its 82 jobs, its beneficial effect across city and county boundaries.

The same sense of common purpose did not survive the afternoon. By 5:30 this evening, they were back together, squared around a large arrangement of tables for a joint meeting between all local governments, with one item on the agenda: extending for at least another 10 years two sales tax supplements totaling one extra penny per dollar.

Half that penny generates $4 million a year for the school district. That half is not in contention. The district used its share over the past 10 years to build Belle Terre Elementary, among other projects, and to vastly increase students’ access to technology. All local governments support the renewal.

The other half penny is the problem. That’s the half shared between the county and the cities. Palm Coast isn’t as interested in renewing the sales tax, at least not on the county’s terms. Today’s meeting was designed to have each side air its ideas, and for the county to convince Palm Coast of its needs. The courtship was well-meaning and kindly received, but not exactly requited. At the end of a two hour meeting, the two sides were still almost as distant as they were 120 minutes earlier, agreeing only to talk some more, but with no change over the essential difference between the two.

Over the past 10 years, the county and Palm Coast have gladly shared the $4 million a year the half-penny sales tax has generated, as have the smaller cities in the county. Ten years ago, it was Palm Coast that got the half penny on the ballot (largely on the strength of then-City Council member Tom Lawrence, now the Flagler tea party chairman). This time the county wants to renew the deal. The city is not as interested. At least not if the formula that splits the money between the county and the cities is changed, the way the county wants to change it, reducing Palm Coast’s share by $6.5 million over 10 years (and increasing the county’s share by more than that, because it would also nibble at Flagler Beach’s and Bunnell’s shares).

The city is critical of the proportion of the money the county is taking, and of the way it spent the money in the past 10 years. It doesn’t help the county that the sales tax revenue helped pay for the county administration building that opened in the earlier part of the decade—a building more popularly known as the “Potato Palace,” for its ostentatious size and look. But the school board, which shares the building with the county, also spent parts of its sales tax proceeds on the administration building. The proportion was smaller, however.

The county is now focusing on two immediate needs: a bigger or newer jail, and a new home for the sheriff—or rather, a refurbished home in the old courthouse. To accomplish those goals, the county needs new revenue.

And to convince Palm Coast, the county marshaled powerfully placed speakers on its behalf at this evening’s meeting, none of whom usually appears before other governments: Circuit Judge Raul Zambrano, Flagler County Sheriff Don Fleming and County Jail Director Becky Quintiery. Zambrano, treading political currents that are usually anathema to judges, described a judiciary up “against the fence” because every decision to put a person in jail is paralleled by a decision about who to take out, because of lack of space in the local jail. “What’s happening is your population is going up, and we’re keeping the jail population down, and the only way to do that is to make some very tough decisions from the judiciary,” Zambrano said. (There were 3,600 arrests last year. There’s been 976 so far this year. Each may require a jail bed.)

Fleming followed with descriptions of antiquated and cramped spaces, “the same space we had 22 years ago,” he said. Quintiery, the jail director, spoke of violent and non-violent offenders who can’t be separated adequately, of a female housing unit designed for 14 inmates that had 17 today, and has peaked at 28 in recent months, and of a jail that’s become “a detox and psychiatric facility” without being equipped for it.

“We’re looking at just one public safety issue that should benefit all of us and all of our residents equally,” County Commissioner Alan Peterson said, “so it seems to me that the jail is paramount, that we all need to solve that issue as best we can.”

Palm Coast doesn’t dispute the county’s needs. It just has needs of its own, improving its drainage infrastructure and its bridges and roads in particular. “I’m hoping that we’re not going to sit here trying to judge each other’s needs and necessities, and that we can have a reasonable discussion about how we can best, each of us, meet the responsibilities that are ours, and ours alone,” Netts said.

It sounded conciliatory, and in a way it was. There certainly was no desire around the table to cast stones. But Netts had chosen words more carefully than they’d necessarily need heard, particularly the part about responsibilities “that are ours, and ours alone.” He explained after the meeting in terms that left no room for doubt: “Raising taxes is unpopular, whether it be ad valorem tax, whether it be utility tax, whether it be a sales tax—it’s unpopular. No question about that. You have an obligation. Be a man, stand up, and if you truly need a new jail, then tell the people, here’s how I’m going to fund it. You may not like it. Nobody likes that. I don’t want to pay anymore taxes. But this is what we’re going to do. Palm Coast, if your infrastructure is falling apart, solve the problem. Nobody is going to like it. Do it. Stand up, be a man, fess up, you’ve got to do what you’ve got to do. It’s not going to be popular.”

The county is trying not to get to that point by itself. If it’s to get its sales tax, it needs Palm Coast more than Palm Coast needs the county. Palm Coast is leaning toward getting its revenue from a different, new tax–on utilities. But absent Palm Coast’s political support, the county would have a hard time passing the sales tax in a climate hostile to any kind of taxes.

The other cities, meanwhile—Bunnell, Flagler Beach, Beverly Beach—sat around the table Tuesday evening, attempting once in a while to sound as if they mattered in the discussion, knowing they didn’t: they were not so much around the table as caught between the county’s two big powers, their fate hanging by the decisions the two—and the two alone—will make.

So far, only Milissa Holland on the county commission has spoken explicitly of compromising to get closer to Palm Coast’s position, in order not to lose Palm Coast altogether. She is not wedded to the sharing formula that the county favors. Nor is she convinced the county needs to build or expand its jail to the extent that the city administrator speaks of—that is, doubling the jail’s capacity to around 250 beds. “So I’m willing to open up the discussion,” Holland said. “I will say this: we all have to come together to do something, because if we do nothing, and we leave here tonight, then we’re all going to lose. Each municipality will lose out, the county will certainly join you in losing, particularly the school district.”

The only two distinctive new ideas of the evening were these: First, Netts suggested that the 10-year framework of a new sales tax be relaxed. There’s nothing in law that says the sales tax must be imposed for a minimum of 10 years, or for five, or that it must be limited at all. He is proposing looking at a longer horizon, which enables bonding tax revenue and spreading it over more years. Second, Revels, the commission chairman, suggested the formation of a task force that would bring together delegates from each government to hash out a new proposal. The governments agreed, but the specifics of that task force—who would serve, how often it would meet, what its exact objective would be—were not worked out. The proposal was left along the lines of keeping communication lines open.

And the only solid agreement around the table was verbalized by Netts, in support of the school district: “One thing we need to take away from this meeting, that I hope we take away from this meeting: win, lose or draw on this half cent sales tax issue, how we distribute the money, totally separate issue, separate and apart, is the half cent for the school board. Whatever we decide to do has no impact on them. I would hope that everybody sitting around this table and sitting in the audience will fully support the half cent for the school board.”

The five school board members and the superintendent would have loved to hear Netts’ words and seen the assenting heads around the table, but they’d left by then, to make it to their own previously scheduled school; board meeting across the parking lot—in the administration building the half-cent sales tax built.