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An expanding population needs increased safety and health services. With that in mind, sales tax funds have been used to construct additional fire stations, as well as expand existing fire stations to accommodate new Advanced Life Support (ALS) services. A new Health Department dental clinic was recently under construction The Sheriff's Department has used sales tax funds for a much needed security retrofit at the Indian River County Jail. The tax also made it possible to expand recreational offerings to our residents by construction of entirely new parks, such as the North County, South County and Round Island Parks, as well as improvements at Donald McDonald and Wabasso Causeway Parks. The Gifford Aquatic Center, a new state of the art swimming facility completed in just the past year, was partially funded by this tax, and partially funded by private contributions coordinated by the Gifford Progressive Civic League. The original referendum approved the Optional Sales Tax through May 31, 2004. In order to continue receiving funding from this source, the Board must approve an ordinance calling for a Countywide referendum set before the voters during the November 2002 general election. The purpose of this agenda item is to illustrate the advantages of this tax and to urge passage of an ordinance allowing the tax to continue for an additional 16 years. Discussion: The Optional Sales Tax offers a number of advantages over the traditional ad valorem (property) tax, as described below: 1. Everyone pays -not just the property owners: Our population swells significantly with part-time residents and tourists during the winter months. County roads and other infrastructure are built for peak demand. Visitors use the same libranes, roads and parks as our permanent residents Yet because of their `nonpermanent status, they do not 'pay' for their construction or use as our property owners do. Pursuant to Section 212.054(2)(a), Florida Statutes, the tax " ...shall be a discretionary surtax on all transactions occurring in the county which transactions are subject to the state tax imposed on sales, use, services, rentals, admissions and other transactions by this chapter and communications services as defined for the purposes of Chapter 202." Clearly, anybody visiting here for any length of time will be highly likely to 'use' or `purchase' a service which will have the tax imposed on it. 2. `Essentials" -Food and Medicine are not taxed: Any extra tax, even a small one, can place undue hardship on people with limited economic resources. The tax exempts most purchases of food and medicine, just as these purchases are exempt from state taxes Rather, the tax is on `non-essential' transactions, in essence, those that might be considered above the basic survival needs of an individual. 3. Health of the local economy is preserved: Large transactions such as car and boat sales are important to the economic health of the County. The local option sales tax cannot be collected on sales amounts above $5,000 on any item of tangible personal property -thus capping the maximum amount of additional sales tax collectible on this type of transaction at $50. 4. Money is earmarked for specific projects: In accordance with Florida Statutes, the Optional Sales Tax cannot be used for governmental operating expenses. A schedule detailing proposed projects for the first five year period of the levy -discussed in more detail later in this agenda item- does show operating expenditures associated with these projects but this category is for information only. Only capital exnenditures associated with a project may be expended from Optional Sales Tax funds. MAY 21, 2002 -46-