TBO.com - TBO is Tampa Bay Online

Port Richey Repeals Utility Tax

ADVERTISEMENT

By CHRISTIAN M. WADE | The Tampa Tribune

Published: July 23, 2008

Updated: 07/23/2008 03:30 pm

Port Richey City Council members have repealed a utility tax that's been on the books since the 1960s.

Following a preliminary vote on the ordinance two weeks ago, the measure was approved 3-2 Tuesday night, with Mayor Richard Rober and Councilman Steve O'Neill dissenting. The move eliminates the 10 percent tax tacked onto utility bills.

The tax, which has been charged since the early-1960s, generates an estimated $264,000 a year for the city's general fund. City officials have not said how they will make up the shortfall.

Supporters say repealing the tax will provide some relief in tough fiscal times. Opponents argued the city can't afford to forfeit more revenue with statewide property tax reforms forcing officials to operate on a shoestring budget.

Franchise fees such as the utility tax have long have been a source of discontent for city residents. Ranging from 5 to 10 percent, the fees are charged by municipal governments to utility companies for using their rights of way and eventually get passed along to consumers.

In Port Richey, all those franchise fees add up to more than $650,000 a year that pays for police, fire and other services.

But the added layer of taxation made the city a target of a political action committee that tried for several years to dissolve the 83-year-old city government.

Members of the now-defunct group, Port Richey Citizens for Lower Taxes, argued that city residents pay more in franchise fees and taxes than people in unincorporated Pasco County.

Vice Mayor Mark Hashim, one of the group's founding members, made it part of his campaign platform last year, vowing to reduce franchise taxes if elected to council. He said the move was aimed at lessening the tax burden on the city's 3,200 taxpayers.

"This is just the beginning," he said Tuesday night. "We're going to do it."

Only a handful of residents attended the public hearing on the tax repeal. Most spoke in favor of the measure.

"It's a double tax," said Carol Casey. "This is the only city in Pasco County that charges it, and it makes properties less valuable."

Union representatives, who are concerned the repeal will mean less revenue to pay the salaries of government workers, police and firefighters, voiced their opposition. They argued that big business would benefit most from the move.

"The largest beneficiary will be Wal-Mart," said Steve Sarnoff, president of Local 3179 of the Communications Workers of America, which represents two dozen city workers. "But the city will suffer."

Reporter Christian M. Wade can be reached at (727) 815-1082 or cwade@tampatrib.com

Loading Comments...

Email Print

ADVERTISEMENT