Last week, Mayor Ashton Hayward appealed to the state the county’s distribution formula for the local option gas tax. The appeal was sent one week after he had borrowed $15 million for an ambitious road paving plan –10 years’ worth of work done in the next three years.
On Aug. 4, the Board of County Commissioners withdrew their inter-local agreement that would have given the city $15 million to pay off the loan and pave the streets Mayor Hayward had committed to pave.
During the agenda review, County Attorney Alison Rogers discussed the appeal.
She told the Board of County Commissioners that she plans to handle the county’s side of the appeal, unless the board said otherwise.
“At this point, I would expect it would be de minimis, meaning I don’t anticipate any huge outside costs like hourly fees for an attorney or something,” she said. “These are most likely going to be held in Tallahassee. You’re going to have travel expenses, some depositions, perhaps.”
Assistant County Administrator Amy Lovoy told the board that the Department of Revenue hasn’t determined whether all the local gas taxes would held in escrow until the Florida Cabinet decides the appeal.
“The Department of Revenue has been unable to clarify whether or not the percentage in dispute is escrowed or just 100 percent of the funds,” said Lovoy. “I think at this point you should assume it could be 100 percent of the proceeds until it’s resolved.”
In its appeal, the City asked to include its expenditures on drainage in the transportation calculations for the distribution formula. Commissioner May questioned whether that was appropriate since the list of projects that the city gave the county only included paving streets.
Rogers said, “The county’s transportation expenditures are very well delineated in the CAFR (Comprehensive Audited Financial Reports). I think the city’s are not. If DOA (Department of Administration), or whoever is making this hearing, and wants to go back and look at expenditures that the city has made that were not coded as transportation expenditures, but perhaps were, then if they make that finding, then the city’s percentage will undoubtedly go up.”
Lovoy said that part of the issue is the city had not coded its transportation properly.
“A lot of their transportation expenditures are not coded correctly, meaning they’re coded to something else and are legitimately transportation expenditures,” she said. “I’m fairly confident that they’re going to be able to bring more transportation expenditures to the table.”
Since Mayor Hayward never submitted the county’s inter-local agreement to the Pensacola City Council, Commissioner May asked to have a joint meeting with the council.
“I would request, Mr. Chairman, at some point, that we sit down with the city council people, who are elected like we are. I don’t think that they want to waste taxpayer dollars filing an appeal on staff with the city. I would love to have a joint meeting so we can have this discussion in public or with our peers at the city council.”
Last night, Commissioner May was informed that the joint meeting would not take place.
Commissioner Steven Barry said that he supported using local sales tax dollars to fund road projects until a ruling on the appeal is made.
Commissioner Doug Underhill supported Barry’s recommendation and remained confident that the county would prevail.
“I think the city’s best opportunity, the best chance, the best numbers they could have expected is the offer that we have already sent over to them,” he said. “This is actually much ado about nothing to me. We’ll just let the process play out.”
Underhill added, “The city certainly has the right to engage in the appeal process as they are. No animosity there, but I think at the end of the day, we’re going to find ourselves in a favorable position on it.”