Sarasota County officially repeals business tax as an EDC funding source

Sarasota County commissioners on July 9 unanimously approved a revised funding plan in its new contract with the Economic Development Corp. of Sarasota County. But division among the board over the issue of ending the organization-supporting business tax lingers.

Minutes after passing an ordinance that provides a 50% match on the dollar of private donations to the EDC, commissioners voted 3-2 on a separate ordinance that repeals the tax, which had been in place since 1992.

As they did at their June 4 meeting when the commission instructed staff to return with a new funding structure for the EDC, commissioners Ron Cutsinger and Mark Smith cast the dissenting votes to dump the business tax, which EDC officials told commissioners in June averaged just more than $14 per business per year. 

Instead, resident Shari Thornton pointed out during the public hearing, that money will now come from the general fund — courtesy of all county taxpayers.

“As a taxpayer, knowing that the businesses supported paying this business tax for this service, it doesn't seem quite right that it come back to the taxpayers to pick that up,” Thornton said. “As a taxpayer, I object to that.”

Sarasota County Director of Governmental Affairs Rob Lewis reminded commissioners of that tax burden shift, which is capped at $500,000.

“To be clear, that money is going to come from general fund. The local business tax is not part of this agreement,” Lewis said. “We will have general fund money that will contribute to that, and it will also continue to include the per capita.”

The per capita fee is the product of an interlocal agreement between the county and city governments as a funding source for the EDC. For the county, that amounts to $288,097 of the $464,223 total in per capita funding for next fiscal year. That will remain in place. Should the EDC reach its private fundraising goal of $575,000, the county will pay an additional $287,500 from the general fund.

The EDC’s total fiscal year 2025 budget is $1.82 million. Of that, the county will contribute $575,597, and potentially up to $788,097, including the capped amount of the match should the EDC raise $1 million or more.

Citing the commission’s affirmation of the max millage rate for next fiscal year at 3.30 mils earlier in the July 5 meeting — touted as the lowest rate in 37 years — Commissioner Neil Rainford praised his colleagues for what he called yet another tax-cutting measure. This was despite a unanimity of business owners who spoke at the June 4 meeting in favor of taxing themselves.

“This is another opportunity to put tax dollars back in local businesses,” Rainford said. “I’m not sure every one was represented here when we had a few public comments, but certainly they're hard at work, trying to run their businesses and every dollar we can put back in their pocket is important to me.”

Cutsinger, a member of the EDC board as the County Commission’s representative, in contrast to the June 4 discussion, did not speak to the matter. Smith, however, had some final words on the subject. 

“When you have a group of businesses that are lobbying us to continue to tax them to support the EDC and then you decide not to do that as we're cutting the millage rate, and so now we're going to use general fund money to support the EDC — which is worthwhile — I just think this is not a wise idea, to be honest and polite,” Smith said.

His attempt at civility, though, was brief.

“I can't support the motion,” he added in the same breath, "because I just think it’s, quite frankly, dumb.”

Commissioner Joe Neunder, who had not planned to speak to his second of Rainford’s motion to approve abolishing the business tax, was compelled to respond.

He said of the multitude of business owners he has spoken with in casual settings he has yet to hear of one who was either familiar with the EDC and, with respect to the business tax, they’d prefer to use that money elsewhere.

“If they want to support it,” Neunder said, “they have a checkbook and they have the address.”

This article originally appeared on sister site YourObserver.com.