County plans $170 million in penny-tax spending

During its initial budget workshop for fiscal year 2024, Sarasota County commissioners reviewed a list of proposed capital projects to be funded by $170 million in Surtax IV revenue.

Surtax IV is a one-cent sales tax renewal approved countywide by referendum on Nov. 8, 2022. The current penny sales tax will expire on Dec. 31, 2024. The new penny sales tax will be effective on Jan. 1, 2025 and will continue through Dec. 31, 2039.

The 1% sales surtax will fund investments in capital improvement projects for the county, school board and municipalities. It applies to the first $5,000 of any purchase that is subject to the state sales tax. Proceeds from the surtax may only be used to invest in public infrastructure projects such as public safety, the environment, water quality, libraries, parks, schools and roads.

While currently in draft form, Deputy County Administrator and Chief Financial Management Officer Steve Botelho told commissioners the plan is for two borrows against future tax revenue for nearly two dozen capital projects ranging from right-of-way acquisition for road construction to park improvements. 

Commission Chairman Ron Cutsinger asked Botelho if the projects can be included in one borrow. 

“We need the money, but at the same time I don't want it sitting in an account at zero interest while we're waiting to do some projects,” Cutsinger said. “Some of these designs and projects take several years.”

County Administrator Jonathan Lewis said the finance staff is planning a Series A and Series B borrowing plan to address Cutsinger’s point of balancing the cost efficiency of one borrow versus money sitting in an account collecting dust while awaiting spending.

“The current plan is for the two tranches, because each tranche would have a three-year spend-down so we can make sure that we don't have any issue with the spend-down,” Botelho said. “We're still actively looking at it. If we do one, that's great; less issuance costs.”

Two highest-priced projects under the proposed first $107.3 million borrow in fiscal 2024 are $22.7 million toward construction of the new $75 million county administration building and $21.4 million for the County History Center/Fruitville Library expansion and renovation, both off Fruitville Road east of Interstate 75. 

Big-ticket projects for the second borrow, at $62.6 million, in fiscal year 2025 include $25 million for Sheriff’s Office headquarters renovation and $20 million for Lorraine Road extension from Fruitville Road to Palmer Boulevard.

Those plans are subject to change as budget season nears this summer. Budget adoption is scheduled for September.