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Item M4BOARD OF COUNTY COMMISSIONERS AGENDA ITEM SUMMARY Meeting Date: May 21, 2008 Division: BOCC Bulk Item: Yes No x Department: Neugent — District 2 Staff Contact Person/Phone #: Terri Marble X4512 AGENDA ITEM WORDING: Request to rescind the prior action taken by the Board of County Commissioners, April 16, 2008 for approval of an Ordinance to impose a ninth -cent local option motor and special fuel ("gas") tax. ITEM BACKGROUND: attached PREVIOUS RELEVANT BOCC ACTION: CONTRACT/AGREEMENT CHANGES: STAFF RECOMMENDATIONS: TOTAL COST: na BUDGETED: Yes No COST TO COUNTY: na SOURCE OF FUNDS: REVENUE PRODUCING: Yes No AMOUNT PER MONTH Year APPROVED BY: County Atty _x OMB/Purchasing Risk Management DOCUMENTATION: DISPOSITION: Revised 11/06 Included x Not Required AGENDA ITEM # ( Cover Story: Autos ) By Mike Vogel FUEL INJECTION: Europe, says AutoNation Chairman Mike Jackson, has M fuel economy standards but the equivalent of $6 a gallon gas. The result: Vehicles there have better mileage than those in America. J.K.Y 5.Jtr' P�­n'.Ph Car sales will rebound in 2009 -- maybe sooner — according to AutoNation's Mike Jackson. In the meantime, he says, raise the gas tax. aMng past a display ofnew cars in the lobby of his Fort W uderdale headquarters, e Jackson, a self -described t ofhuman nature, explains nect in consumer behavior. Sixty out of 100 people who come into his com- pany's car dealerships say they're interested in hybrids. only two out of 100 fork over the money for them - Green hypocrisy? Not at all, Jackson says. it's economics. With gas at $3 per gallon, the payback on a hybrid takes 10 years. Aside from those passionate enough and well enough off to snake a statement by buying a hybrid, "People say,'Show me something else: It's not a mass -market product;' Jackson says. The thing to do about America's gas depen- dence, argues the chairman of the nation's larg- est auto retailer, is to raise the federal gas tax by $1 per gallon over 10 years. Jackson's stand in the tax pulpit coincides with his stature as one ofthe most powerful players in the auto industry. He emerged first as a crusader against Detroit's overproduction, now as advocate for a higher tax. He — and au- tomakers - support a new federal law requiring automakers to raise fuel economy to a fleet aver- age of 35 mpg by 2020 for cars and trucks. But he I opposes efforts by California and other states to impose their own individual gas mileage regula- tions, which he sees as detrimental to sales. Vehicle sates, after all, are his business. Lately, it's been a tough sell. U.S. new -vehicle sales began to slide in 2006 and fell to 16.5 million last year, down from a peak of 17.3 million in 2000, Jackson predicts sales will fall to the mid-15 million level this year. AutoNation has suffered accordingly. With half its new -vehicle sales coming from California and Florida where the housing slump has hit hard, AutoNation's 2007 profit fell 12% to $279 trillion, its worst yearly performance since 2001. Revenue slid 5% to $17.7 billion, its worst revenue year since 2003. Jackson came to AutoNation in 1999 at the behest of Fort Lauderdalebillionaire and former major AutoNation shareholder H. Wayne Huiz- enga, the deal maker behind Waste Management, Blockbuster and the Miami Dolphins. AutoNa- tion — Huizenga's amalgamation of used -car su- persoores, new -car dealers and rental car compa- nies National and Alamo — was supposed to be a revolutionary, synergistic wonder. But Huizenga grit himself in over his operational head. By 1999, AutoNation was running a $31.5-million loss on its auto sales business, and the stock had fallen from a peak of $44 to $7.50 per share. Huizenga needed a car guy. And if ever there was one, it was Jackson. After graduat- ing with a political science degree in 1971 from St. Joseph's in his native Philadelphia, Jackson had an eye for law school. But while he was FL0R10ATREN9.CDM MARCH iDOB 59 `� f. ( Cover Story: Autos ) Before Mike Jackson was hired in 1999, 607 of AutoNation franchises were volume domestic brands. Today, only 307 are domestic, and Jackson wants to get that figure down to the mid-20'7. range. The AutoNation Empire still a newlywed, his old Mercedes 190 headquarters out of work just before SL broke down and, in exchange for Christmas 1999. His resume soothed 2007 cars sold 535,000 repairs, Jackson took a job in a dealer automakers and investors. At his first (61 cars everyhour) _ service department. He fell for the AutoNation annual meeting, held at a business - and went on to become a Fort Lauderdale theater in May 2000, 2007 rvvenw f17.7 billion facto field technical representative, the Huizenga team spoke from behind New vehicles $10.2 billion marketer, partner in a Maryland Mer- the podium and teleprompter. Jackson, Used vehicles $4.2 billion cedes dealership, head of Mercedes' by contrast, roamed the stage, speaking - - national dealers council and ultimately •. without notes. He owned the room. Parts and service $2.6 billion president of Mercedes-Benz USA, the With President and Chief Operating Finance and insurance $594 million first non -German to hold the post. He j Officer Mike Maroone,a Broward dealer - is widely credited with turning around whose operations Huizenga had bought, 2007 grou profit $2.9 billion Mercedes' U.S. sales by ditching stodgy Jackson spent the next five years on the New vehicles $720 million advertising, cuttingdealermarkups retail details - inventory control, inte- 1$2,189 pervehicle) and persuading Germany to make grating systems, finding and standard - Used vehicles $359 million vehicles that appealed to younger U.S. i izing best practices, buying stores that ($1,741 per vehicle) consumers, such as the SLK Roadster helped him reach critical mass in certain and M-Class SUV. He established a markets and unloadinglow-volume,low- Parts and service $1.1 billion reputation for brainpower. "Incredibly return franchises in others. (AutoNation Finance and insurance $594 million smart," says Art Spinella, president of now has 322 franchises, 78 fewer than at {51,110 per vehicle) CNW Marketing Research in Oregon. year-end 1999.) Today, reports JP Mor- "He's an information vacuum cleaner, gan analyst Edward Yruma, AutoNation 2007 profit $279 million -- -- - - ---------- - He collects information and can pro- has thebest-in-class operatingmargin at 2007 total employment 25t000 cess it very quickly." 4.1%, a half a percentage point ahead of - - - — Jackson lost little time at AutoNa- its closest competitor, 2007FIoridoemploymont 7,300 ---- - -------- --- lion. Huizenga already was spinning off the rental car operations. Jackson Speaking his mind . p g Major Florida brands shut down the money -losing; used- ', Forever scrutinizing inventory levels, ; Maroone, Auto Way, Courtesy, Mike Shad _...__.-_____. car superstore chain, putting 1,800 Jackson didn't like what he was see- ..... .---.._........ s� e,n ,oa,ro employees from the stores and 200 at ing from Detroit. The Big Three were 60 MARCH 2O08 FLORMATRE1,110-coM production -push oriented, churning out Mich., says even though other big deal - vehicles that consumers would buy only ers haven't spoken u}x Jackson's heft as if bribed with incentives and discounts, a retailer has insulated him from retali- After largely fruitless private talks with ation. "Maybe if he were a little dealer in Detroit, Jackson went public in 2004. He Timbuktu that might be the case, but he's foresaw an "awful day of reckoning." He Mike Jackson. I think what everybody criticized manufacturers by name, pub- I appreciates in Mike is he represents the licly disputed their estimates of unsold in- i feelings of a great many dealers." ventory at dealers, prodded them to con- Jackson today says he was just bring- solidate dealerships and rebuked them for ing a consumer's viewpoint to an indus- rebates and discounts. "He can get press try that historically lacked a channel to when he wants," says Burbank, Calif., receive it. "Look at Wal-Mart. I don't see dealer consultant Mark Rikess. "He's got manufacturers dictating to Wal-Mart. some clout" i Wal-Mart's the retailer. Wal-Mart's deal- Automakers bristled but had to take ing with the customer they have a good it. David Cole, chairman of the Center ii feel on things, The value of our input is for Automotive Research in Ann Arbor, seen today where it wasn't exactly appre- Gas Prices vs. Fuel Efficiency "They (Europeans) have no June 1.2007 fuel economy standards. Gas They got to 36 miles a gallon Tax gallon versus 21 through ox2i M the price of gasoline, I'm not saying we need to get s,se as9.o� America to $6 a gallon and get America to that product r ao to; mix, but I'm just saying sx,m' the price of fuel is the key } k• equation here." Mike Jackson Europa Japan U.S. In Europe, taxes account for 68X to 75% of the price of gas, and 40%of cars run on diesel. HIGH -END HOPES: AutoNation'snew Lexus dealership in West Palm Beach offers customers high -end touches. Mike Jackson is hopingthe compeng's continued move into higher -margin imports will make investors more comfortable too. What's Important to Buyers 1. Monthly payments 94% 2. Overall quality 93 3. Manufactureisreputation 90 4.�Ergonomics 85- 5. Seating capacity f 82 6. Airbags -- - - -- 80 7. interior conveniences 71 ------- ----- a. Sound system 69 9. Comfort and convenience 64 10. Simplicity and usefulness of controls 60 11. Cup holders 59 12. Interiorappeorance 58 13 Fuel economy 57 14. Luggage capacity 56 15 Handling and performance 51 16 Cast alloy or special wheels 51 17. Tilt steering wheel 41 Swnce, CNw R-h FLORIDATREND.COM MARCH 20D6 61 ( Cover Story: Autos ) ciated five years ago," he says. The good news, says Jackson, is that he doesn't have to be as critical any- more. The Big Three have changed and cut production. Ford and Chrysler hired executives attuned to market -pull rather than production -push. The bad news: Detroit's improvement is obscured by the auto sales recession. "I111 make a prediction," Jackson says. "When the cycle turns, people are going to be amazed at the kind of numbers that they're able to put up." Jackson sees that turn coming in 2009, perhaps even in the second half of this year. We're 24 months into what's typi- cally a 30- to 40-month down cycle, he says. Jackson's brightening outlook is significant, coming as it does from some- one who has been a "fairly vocal pes- simist" and "persistently bearish," JP Morgan's Yruma wrote in a research re- port last year. Until the slump ends, Jackson has to Concentrate on cutting expenses, keep- ing inventories low and experimenting with approaches. He also will continue to move AutoNation away from domestic brands. When he was hired, 60% of the company's stores were volume domestic brands, with the rest being volume im- ports and higher -margin luxury brands. Today, only 30% are from Detrait's Big 2007 Auto Sates [esamated; change from 2006) North America 19 million -2% Europe and Japan 27 million ; +3.8% China 8 million +19% The rest of the world 1' S million +5`Y Total 69 million +4% S­J.u.ra"eaw—�r,r 62 MARCH 2oas FLORIOATREHO.COM > 'Jackson On... spade. Tate NaA% t ie ��tC eat 1h.the,at $2 504 .,✓i�l,�llEyacrudq,!pk>Iluting,.unsafe .. �.,w` lling;a Tata in %irclerica — 08: "49'e wank sell it i don' in it: Ultimately,) r> r l'lptors a Chrysler, a:Ford whereallthat expsr8se and knowledge'is ifansfeffv €Into the,Ckinese. Then we'll seH rt, but Chats doing to take.time." r k'� z "Thera is a group of customerswho passioriate[y mart stands for and they will defiriitely buy one, and ou g 91 s@112ppgp'to 25,i7O0. is it a mass market solution? No:" pfJ L4onhas, tWa'St Afranchises.) t :ca are apprQashIng divine.perfeotibn ". . h wliin`has rience.w€th eel€ phones FDAs and home @nte�inmsntsystQrrns. $ CSC "Through happenstance,my first cerwas a iNerCr#das. I've p,�srry'•ita$huplireds maybe a thousand =1 don't know, l've long lost ttac)c An ney were all great.l love them." PfAltfdfin* He has little use for leaders who put out regulations with a c4�st'that comes due far in the future. Politicians who simultaneously want energy eornsOrwitlon and cheap energy have takan a "morally bankrupt; intellectually dlshdnest position. Cheap electricity, cheap gasoline and high efficiency and consuming less don't go together. You can't have both." Three, and Jackson wants the company pay for highway, bridge and infrastruc to reduce its volume domestic brand seg ture improvements. ment to the mid-20% range. Investors Jackson says research shows consum would welcome anythingto improve mar- ers would support higher gas taxes t gins. While the stock has gotten as high as reduce dependence on imported oil. Con $23 over the last five years, it's essentially sumers also believe importing petroleur gone sideways for buy -and -hold investors means funding both sides of the war o over that period. terror, according to the research. He say regulations now proposed in Californi The value of $6 gas will jack up the price of cars $5,000 t Jackson, 59, isn't letting up on the tax $10,000 per vehicle over a decade. Con and fuel efficiency issue. He argued for` sumers won't pay that premium with ga the tax increase in a speech at the auto at $3 per gallon, he says. Instead, they' show in Detroit in January. He included I hang on to older vehicles and buy use( a slide showing consumers rated sound which will do nothing to cut carbon dins systems and cup holders ahead of fuel ide emissions or improve fuel economy. economy as factors in their car-purchas- Says Jackson: "If you want to Chang ing decisions. He demonstrated how a behavior, you've got to disadvantag Europe, with no fuel economy standards what you want them to use less of an but the equivalent of $6 a gallon gas, has I, advantage the direction you want ther vehicles with better mileage than those to go." m in America The federal gas tax, at 18.4 cents per gallon, hasn't increased since MMMOM 1993, though a federal transportation l Interactive map showing mck vs. car panel has recommended raising the tax sales statewide by 25 to 40 cents a year for five years to * 3:00 P.M. PUBLIC HEARING a Meeting Date: April 16, 2008 - KW Bulb Item: Yes No X Division County Attorney Staff Contact Person: Suzanne Hutton AGENDA ITEMWORDING: A public hearing for approval of an Ordinance to impose a ninth -cent local option motor and special fuel ("gas") tax. ITEM BACKGROUND: The County imposes a six -cent local option gas tax on motor fuel. The State mandates a County fuel tax on diesel fuel under FS 206.87 and the County gets a portion of that from the State. At the November 14, 2007 meeting of the BOCC, discussion was held concerning the depletion of the County's gas tax reserves due to increased costs, the state legislature's limitations on ad valorem taxation, and the inability of the County to continue to service the road and bridge system and to conduct critical renovations for bridges nearing their 50-year life span. Options were provided to the BOCC to increase the gas tax or to levy special assessments. The BOCC directed staff to pursue the gas tax increase. PRE, VIOUS RE, LEVANT BOCC ACTION: Ordinance No. 16-1989 approving extension of the six -cent "gas" tax authorized by F.S. 336.025(l)(a). 12/19/2007 (Q-13) BOCC tabled to 2/20/2008 BOCC 2/20/2008 (P-2) BOCC denied request to hold Public Hearing 3/19/2008 (N-15) BOCC approved advertising/holding Public Hearing 4/16/08 in Key West CONTRACT/AGREEMENT CHANGES: N/A STAFF RECOMMENDATIONS: Approval. COST:TOTAL COST TO COUNT': None BUDGETED: No REVENUE PRODUCING: Yes X No AMOUNT PER MONTH Year $500,000 APPROVED BY: County Atty x OMB/Purchasing Risk Management DOCUMENTATION: Included X Not Required WIIEREAS, Florida Statute Section 206.41(1)(d) authorizes counties to impose a tax of one cent per net gallon on motor fuel, known as the "ninth -cent" fuel tax to be levied and used as provided in F.S. 336.021; and WHEREAS, Florida Statute Section 206.87(1)(b) mandates a "ninth -cent" fuel tax to be levied on diesel fuel, to be levied and distributed according to F.S. 336.025.; and WHEREAS, the County has been receiving from the State a distribution of the mandate fuel tax on diesel fuel; and - VMEREAS, current gas tax expenditures cover Maintenance, Engineering, Street Lights and Traffic Signal, distribution to municipalities, 7-year plan and cost allocation, WHEREAS, the gas tax fund balance has been steadily declining since FY 2001 due to annual expenditures exceeding annual revenues; and WHEREAS, Monroe County maintains 389 miles of roads in the unincorporated county and resurfaces those roads as needed; WHEREAS, there are 28 bridges in the unincorporated county which are maintained by the County and most of those bridges were built in the 1960s with a 50 year life span; and WHERE AS, there are approximately 10 years left with no funds available for major renovations necessary to extend the useful lives of the bridges which are maintained by the County; WHEREAS, drainage systems need to be added or restored, requiring reconstruction and resurfacing of roads; and WHEREAS, road resurfacing has been temporarily delayed in some areas of the unincorporated county due to new sewer systems and resurfacing will be needed in the near future; and Ninth Cent fuel Tax Ordinance 2008 1 WHEREAS, the County is seeking to enact an ordinance imposing an additional five (5) cents local option fuel tax to generate approximately $250,000.00 per penny (or $1,250,000.00) per year; and WHERE AS, an additional ninth -cent local option fuel tax on motor fuel is needed to provide funding, particularly for the renovations of the bridges and other critical major renovations of roads; and WHEREAS, an additional ninth -cent local option fuel tax on motor fuel can be accomplished by a majority plus one vote of the BOCC or by an ordinance creating a referendum on the November 2008 ballot; and WHEREAS, implementation of an additional gas tax will spread the costs to both residents and visitors using the County's roads as opposed to special assessments which would place the full burden on County residents; and WHERE, AS, unless a revenue source additional to the existing local option fuel tax can be secured, the current level of services will have to be reduced and the delay for needed road restorations and reconstructions and necessary revitalization of bridges will continue; now — therefore MONROE COUNTY, FLORIDA that: SECTION f. Section 2-321, Monroe County Code is hereby created to read: 2-321. NINTH -CENT MOTOR FUEL TAX. (a) IMPOSITION. Under the authority of F.S. 336.021(1)(A), effective January , 2009. there is hereby imposed a one cent gas tax. to be designated the "ninth -cent fuel tax," upon every gallonof motor fuel sold in the County and taxed under the provisions of part I or part 11 of Chapter 206. F1a.Stat. (b) COLLECTION. The tax in this section shall be collected and remitted according to the procedure in_F.S. 336.021. (c) EFFECTIVE PERIOD. The tax levied in Section 2-321 shall commence on January 1, 2009, and be in effect for a period of thirty (30)years, unless repealed by the Board of County Commissionersprovided that no repeal shall in any circumstances materially -or adversely affect the rights of the holders of bonds backed by the tax and outstanding on the effective date of the repeal. d) EXPENDITURES. The proceeds of the tax, shall only be used for transportation expenditures as defined by Florida Statute Section 336.025(7) and which are: 1 Public transportation o erations and maintenance; 2 Roadway and ri t-of-way maintenance and e ui ment and structures used primarily for the storage and maintenance of such equipment; (3) Roadway and right-of-way drainage; Ninth Cent Fuel Tax Ordinance 2008 2 (4) Street lighting; 5 Traffic signs, traffic enp_ineeriniz, signalization and pavement markin gs 4 Brid e maintenance and operation; (51 Debt service and current expenditures for transDQrtation capital projects in the foregoing program areas. SECTION 4. SEVERABILITY. Should any provision of this Ordinance be declared by a court of competent jurisdiction to be invalid, the same shall not affect the validity of this Ordinance as whole, or any part thereof, other than the part declared to be invalid. If this ordinance or any provision thereof shall be held to be inapplicable to any person, property or circumstances, such holding shall not affect its applicability to any other person, property or circumstances. SECTION 5. CONFLICT WITH OTHER ORDINANCES. All ordinances or parts of ordinances in conflict with this Ordinance are hereby repealed to the extent of said conflict. SECTION 6. INCLUSION IN THE CODE OF ORDINANCES. The provisions of this Ordinance shall be included and incorporated in the Code of Ordinances of the County of Monroe, Florida, as an addition or amendment thereto, and shall be appropriately renumbered to — conform to the uniform numbering system of the code. SECTION i. EFFECTIVE DATE. This Ordinance shall take effect on , provided that this Ordinance shall be filed with the Department of State as provided in section 125.66(2), Florida Statutes. _ SECTION S. FILING CERTIFIED COPY WITH STATE. In addition to filing a copy of this Ordinance with the Department of State, the Clerk shall notify the Florida Departments Environmental Protection and Revenue of the adoption of the ordinance, including providing certified copies of the ordinance thereto, within ten days after the adoption of the ordinance. PASSED AND ADOPTED by the Board of County Commissioners of Monroe County, Florida, at a regular meeting of said Board held on the —th day of , 2008. Mayor Charles "Sonny" McCoy — Mayor Pro Tern Mario DiGennaro — Commissioner Sylvia Murphy — Commissioner George Neugent — Commissioner Dixie M. Spehar — (SEAL) BOARD OF COUNTY COMMISSIONERS Attest: DANNY L. KOLHAGE, Clerk OF MONROE COUNTY, FLORIDA By By Deputy Clerk Mayor/Chairperson Ninth Cent Fuel Tax Ordinance 2008 3 ONROE r^nUNITv ATTOR TTO :F I 1 V TON GUU l/ ^yy I —I �d t� W NOTICE IS HE, REBY GIVEN TO WHOM IT MAY CONCERN that on Wednesday, April 16, 2008 at 3:00 P.M., or as soon thereafter as may he heard, at the Homey Government Center, 1200 Truman Avenue, Key West, Monroe County, Florida, the Board of County Commissioners of Monroe County, Florida, intends to consider the adoption of the following County ordinance: Pursuant to Section 286.0105, Florida Statutes, notice is given that if a person decided to appeal any decision made by the Board with respect to any matter considered at such hearings or meetings, he will need a record of the proceedings, and that, for such purpose, he may need to ensure that a verbatim record of the proceedings is made, which record includes the testimony and evidence upon which the appeal is to be based. ADA ASSISTANCE: If you are a person with a disability who needs special accommodations in order to participate in this proceeding, please contact the County Administrator's Office, by phoning (305) 292-4441, between the hours of S: 30 a.m. - 5: 00 p.m., no later than 2 working days prior to the scheduled meeting; if you are hearing or voice impaired, call 711" Dated at Key West, Florida, this 19'' day of March, 2008. DANNY L. KOL14AGE, Clerk of the Circuit Court and ex officio Clerk of the Board of County Commissioners of Monroe County, Florida (SEAL) Publication dates: Reporter (Fr) 3/28/2008 Keynoter (Sa) 3/29/2008 KW Citizen (Su) 3/30/2005