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Modified public service tax approved

By Staff | May 1, 2013

It was standing room only in Cape Coral City Council chambers Monday night, with a dozen or so others forced to watch the meeting on a TV just outside.

But unlike the last few times financial diversification came up, supporters of the idea came to the forefront, many of them worried what might happen to the city’s parks.

City Council didn’t need much persuading, and voted 6-2 to approve a plan, albeit slightly different from the one it came to the meeting with.

The new plan calls for a 7 percent hike on your electric bill, with an exemption on the first 500 kilowatthours, the franchise fee and the gross receipts tax. The original plan called for 10 percent.

The fire services tax was increased from 60 to 70 percent, which will be discussed next month and could be adjusted, with the targets of $150 per household and a one mill decrease in ad valorem still on the table.

In the end, the council members seemed even happier with the new numbers as they believed they were fairer to those who live and work here year-round.

“This will bring in more revenue from the vacant lot owners, and the fire service fee goes back under the federal deduction,” Councilmem-ber John Carioscia said. “This also gives a 30 percent discount on the tax to small business owners who depend on electric. I think we found a happy medium.”

You could thank the Burton & Associates model for the change. Councilmember Lenny Nesta made the suggestion of the 30 percent decrease, which the consultants were able to put in their model and check the results in real time.

They saw no significant change in the overall numbers, with the $150 average target intact, although Mike Burton said the fire services tax was more high-end than he would have liked.

The suggestion came after nearly five hours of debate, with two hours of public comment alone. Unlike during prior public comments on the public service tax, many residents came en masse to support the measure.

They particularly came in fear that no action by council would result in the end (or a significant increase in price) of many Parks and Recreation programs, such as youth soccer and Pop Warner.

Revenue diversification also got approval from the Cape Coral Chamber of Commerce for making good business sense.

“The city is limited in fees it can put in. It can’t charge a flat $150 fee or in tiers,” said former mayor and Chamber of Commerce spokesperson Joe Mazurkewicz. “The Public Service Tax is a tool recognized by the state and we support this.”

The opposing side was more vocal, saying the talk of disbanding Parks and Rec was a scare tactic and that the city hadn’t cut enough spending.

“No one believes they should get rid of Parks and Rec, like the air traffic controllers,” resident Ann Arnott said. “We haven’t exhausted every reduction.”

“I’m hurt by the administration using the ‘B’ word. There’s no blight here,” Larry St. Amand said. “The city will have the biggest windfall ever.”

Several council members took issue at comments that they were lying to citizens and hadn’t done their due diligence.

“Would I lie to you or drive this city into problems. I ran for office to keep this city the way it is,” Councilmember Kevin McGrail said. “What amenities do you want? You have to pay for them.”

McGrail said the 7 percent rate would given the city more wiggle room to “fine tune something that’s not in place.”

Councilmember Rana Erbrick and a few others soon agreed.

Mayor John Sullivan and Councilmember Chris Chulakes-Leetz took a stand against any tax. Sullivan said it is time to think about the disabled veterans, the economy was too frail and that the rise in property values would offset any need for the tax.

Both voted against the measure.

City Manager John Szerlag was pleased with the end result and thankful the model was there to guide council.

“It takes the burden off the large electric users whether residential or commercial and that’s the benefit of having the model,’ Szerlag said. “Previous static models you had to go back to the drawing board.”

Even more pleased were residents who need no longer worry about the parks.

“Facing the potential cuts to Parks and Rec, this was no scare tactic. It would have a devastating impact on the kids,” said Aldo Nardiello, head soccer coach at Cape Coral High School. “So many good things come out from participating in youth athletics.”

Even critics of the tax like St. Amand were happier.

“I felt like they were listening to us and were concerned about the residents being charged too much,” St. Amand said. “The fact they did anything will help the lower income people.”