COLLIER COUNTY'S PROPOSED SALES SURTAX INITIATIVE
Letter from the Greater Naples Chamber of Commerce
Collier County voters will be faced with a critical question when they head to the polls on Election Day: How should we pay for the vitally important infrastructure and community projects that make Naples the best place in America to live, work and visit?
It is a question the Collier Board of County Commissioners pondered earlier this year when they voted to place a seven-year, one-cent infrastructure sales surtax on the Nov. 6 general election ballot. If approved by the voters, the local option sales tax would raise an estimated $490 million for infrastructure projects throughout Collier County. The city of Naples will receive an estimated $30 million over seven years for city-specific projects.
This time-limited approach will keep property-based taxes and fees low, reduce the need to borrow money and incur additional interest costs, and ensure essential projects are completed in a timely fashion. Tourists and visitors are estimated to contribute 30 percent of the revenues, lessening the property tax burden of those who live in Collier County.
This is an important caveat as you consider the county’s proposed seven-year, one-cent infrastructure sales surtax.
Local governments throughout Florida – including those in Collier County – rely heavily on property-based taxes and fees to meet annual budgetary needs. That reliance on ad valorem taxes meant local governments had to reduce their budgets, eliminate jobs and shelve projects during the Great Recession. While we have bounced back in recent years, local leaders have struggled to keep up with needed infrastructure and community improvements as they worked to address the backlog of unfinished projects.
County leaders have said time-and-time again that projects to reduce traffic congestion, increase public safety and disaster preparedness, and repair city and county facilities will be completed regardless of the results on Election Day. It’s just a matter of how to pay for our community’s needs.
One way to accomplish this is by selling bonds to pay for projects. However, if Collier County were to borrow money to complete the identified projects, the interest costs could be almost $200 million over and above the project costs. The money required to pay off the loan would be taken from existing general fund taxes and fees and would likely require additional taxes and fees.
Local leaders can also raise the property tax rate to cover the cost of the projects. Based on current taxable values, it’s estimated a .7927 millage rate increase would be needed to generate $70 million a year. That would equal a nearly $4,000 a year increase for a person who owned a home worth $5 million, with no mandatory end date.
In comparison, a family of two with a household income of more than $300,000 would pay about $350 more a year in sales tax.
Unlike a property tax increase, state law requires a local option sales tax to be approved by the voters before it can go into effect. Collier’s proposed infrastructure sales surtax would end after seven years, and state law prohibits it from being extended without voter approval.
Collier County government has created an online resource — www.CollierOneCentTax.com – to inform and educate voters before the election. This website includes detailed fact sheets about each of the projects, budget materials and information about how Collier County compares to the rest of the state. I would encourage you to review these materials and become educated about this important community issue before you cast your vote. Please don’t hesitate to contact me if you have any questions about this proposal.
President & CEO, The Greater Naples Chamber of Commerce