City Council votes down pension plan, opens door to higher taxes

Jacksonville Mayor Brown dealt two blows at Tuesday night's council meeting

JACKSONVILLE, Fla. – Jacksonville's City Council  on Tuesday night voted down a police and fire pension reform bill and raised the maximum property tax rate by almost 15 percent -- although the actual rate may be substantially lower when the final rate is approved in two months.

After lengthy debate, City Council members voted 15 to 3 to raise the property tax rate cap to 1.5 mils -- up from 10.0353 to 11.5353. That would equal about $75 more a year on a house with a taxable value of $100,000.

The council has a current budget shortfall of $61 million, which some say could grow over the coming months. City auditors say if the full 15 percent rate hike is implemented, it would generate around $65 million in revenue.

When the budget is finalized prior to Oct. 1 -- the beginning of the 2013-2014 fiscal year -- the actual rate may be lower.

The issue was contentious. Councilman John Crescimbeni wanted only a 12 percent increase, while Councilman Richard Clark wanted a maximum 26 percent increase. He said it would provide the council more flexibility as they prepare the city budget. Clark said he didn't want to raise taxes that much, he just wanted to give the council flexibility.

Mayor Alvin Brown, who had proposed an austere budget to keep his promise to not raise taxes, was dealt a second blow Tuesday when City Council voted down a pension agreement the administration had negotiated with the Police and Fire Pension Fund.  

Brown said his pension deal would save the city $1.2 billion over 30 years -- $45 million next year alone.   But council members opposed to the plan felt it would cost the city too much money in the long run.

Approval of the pension deal failed on a  7 to 11 vote. This will cause the current pension plan to return to federal court, where it's tied up in ongoing litigation. The city's General Counsel said it will remain there for around another three years before a new deal can be reached.

The mayor's office says they were surprised the council voted to raise taxes and shot down a pension plan that would save taxpayers' money, both on the same night.

"The mayor had a particular plan and council chose to raise taxes and turned down a reform plan that would have save $100 million over the next five years and save over $1 billion over the next 30 years," said Chris Hand, Mayor Brown's chief of staff. "That's how this process works: The mayor makes a proposal, the council here has made a decision; but that was their decision."