Administrator changing stance on sales tax extension needs

By Steve Estes

Monroe County has run out of money to fund further wastewater projects.

State-mandated central collection systems are either finished, underway or soon to start in every unincorporated area of the county except the Lower Keys where the proposed Cudjoe Regional system is slated to serve some 8,800 units.

Facing a state deadline of December 2015 to have the systems complete, the county will not make that deadline mostly because there is no money to fund the construction of the system, estimated to cost about $150 million.

Twenty years ago, voters approved a one-cent sales tax that was sold as a means to pay for the estimated $500 million it was going to cost to sewer the Keys. That tax sunsets in 2018 and nearly every dime of it has been committed to pay for existing wastewater projects leaving nothing for the Cudjoe Regional.

What many people remember, however, is that of the $320-plus million raised by the tax over its 20 year run, less than $80 million actually got spent on wastewater projects. Other parts of it got spent on other projects, including a $15 million government center in Key Largo, $3 million to purchase a defunct restaurant on Stock Island, $2 million to sink the Hoyt Vandenberg as an artificial reef, $8 million to jumpstart construction of a new airport terminal at Key West International as well as fire stations and parks throughout the county.

If one simply looks at what the county was able to accomplish with the money, it was a very successful program, says County Administrator Roman Gastesi.

“You take a look at everything we were able to do with that tax, and it’s an impressive list for a county this size,” says Gastesi.

The problem, according to many residents, is that the impressive list failed to address the primary need for the money, the need for which people voted favorably for the extra tax, wastewater systems.

And now the county needs voter approval to extend the tax beyond 2018 so that some money can be dumped into the Cudjoe Regional to finish sewering the Keys.

That’s why may locals were surprised that Gastesi suggested a few weeks ago that any new tax monies could be used for projects other than wastewater.

“I was unprepared for the negative response because I had the wrong mind set,” said Gastesi.

County commissioners have suggested that the tax be extended for another 15 years which would make about $60 million available for the Cudjoe Regional project. About $50 million of the remaining money would be made up by hook up fees to property owners estimated right now to be $5,700 per equivalent dwelling unit (approximately a single family residence) and county officials had hoped to get money from the state.

The latter funding probably won’t be forthcoming, leaving either the tax or resident’s wallets to pick up the slack.

By extending the tax to 20 or 25 years, Gastesi had said that the low-end wastewater number could be covered and that some other “wishlist” projects could be completed.

That hasn’t brought ringing endorsements from voters burned by the scattered use of the original tax dollars.

And that has the county administrator re-thinking his strategy.

“I didn’t realize that the sensitivities surrounding this issue of those who have been around a while were so strong,” he said.

Now, the focus of that tax, if voters approve it, will have to change, he says.

“We have to configure the tax referendum so that all the money goes to wastewater until it is complete and if there’s anything left, then we can look at other projects,” he said.

County Commissioner George Neugent has suggested that money above what’s needed for the Cudjoe Regional could be used to pay off debt for the other county systems to get monthly user fees to a manageable level and make rates similar for everyone in the county.

Right now, some users pay less than $50 per month for sewer fees. The folks in the Cudjoe Regional area could be facing monthly sewer fees upwards of $120.

“To establish an equitable rate structure for everyone would be a good use of that money,” Gastesi said.

He says that approximately 50 percent of most of the current wastewater systems were paid for by using “outside money” which includes the tax, state and federal funds and grants.

“If we use the tax to pay for 50 percent of the Cudjoe system, that makes outside money fairly even,” he said.

Of course, for the county’s funding plans to work as planned two things must happen.

The county will have to get another extension on completion from the state. Monroe got a five-year extension last year, but will not be able to complete by 2015.

“It’s a little premature to ask right now, but we will have to seek another extension by next year,” said Gastesi.

The second thing that must happen is that the county must get voters to approve the tax extension so it can restructure debt to get the Cudjoe Regional off square one.

Gaining voter approval might not be easy. People remember the “Hickory House” factor, as Gastesi puts it, and since most areas have wastewater in place or nearly in place, some voters outside the Cudjoe Regional are balking at paying the extra penny for another 15 to 20 years.

County officials have said the referendum for the extension of the tax should appear on the November 2012 presidential election ballot.