COVID-19: Another wake-up call for our local economy – Citizens for a Better Nassau

Citizens for a Better Nassau
April 17 2020

The COVID-19 pandemic is a human health tragedy affecting millions worldwide. Our hearts go out to those affected during these tumultuous times and that the rest of us stay safe and well to help prevent further spread of this virus.

The pandemic is also having a profound impact on the global economy, as well as Florida and Nassau County. As painful as this pandemic is, it’s not too early to think about what happens next. Due to our jobs-to-housing imbalance, the lack of depth and breadth in our economic base, and economic over-dependence on tourism, hospitality, retail, and other relatively low-wage service sectors of the economy, Nassau County is likely to experience a disproportionately negative impact on our local economy.

Importantly, as we learned during the 2008 Great Recession, impacts to our local economy also have a significant and potentially long-lasting fiscal impact on our county and local governments. How will our elected leaders react? We hope they’ll control costs wherever they can without affecting critical services. However, we recognize that absent a broader and more diverse tax base, much better capital budgeting and fiscal management, and more significant reserves saved for emergencies, residential property taxes could rise yet again. This would be on top of what can be characterized as massive tax increases during the last two years.


Economic Development & Broadening the Tax Base

Many will recall our Nassau County Board of County Commissioners (NCBOCC) turned down the largest state infrastructure grant offered during former Florida Governor Rick Scott’s tenure. This grant would have brought much-needed infrastructure to the Crawford Diamond, and the public capital investment would have drawn a significant private capital investment from the landowner, Florida Power & Light. While commissioners claimed to have supported economic development and for years implored the Nassau County Economic Development Board to promote the unique logistical advantages of the Crawford Diamond, the NCBOCC ultimately rejected the grant. This was a missed opportunity for the county to improve the resilience of our economy during future downturns, provide high-wage jobs and strengthen our tax base. We must elect leaders who are genuinely committed to attracting capital investment and high-wage jobs to our county if we’re ever to rise above the current hand-to-mouth approach to governing.

Capital Budgeting & Better Fiscal Management

Interest rates are the lowest they’ve been in our lifetimes, and Nassau County has many unmet capital needs. Now is an excellent time to opportunistically use bond leverage to meet some of these needs. Unfortunately, our current NCBOCC made the shortsighted decision of using cash for long-lived capital assets, like the roughly $10 million spent for the Sheriff’s Complex and Emergency Operations Center, rather than bonding, which hurt our taxpayers. While we would never suggest the county use bond debt for operating expenses, long-term bond financing is what we need to address capital budget deficits. This approach naturally results in future residents sharing the cost for the infrastructure necessitated by their anticipated arrival, rather than shifting the entire burden to current, longtime residents. The failure to think over the long term and manage our finances properly to prepare for inevitable growth caused the dramatic tax increases we’ve experienced. It’s always easier to keep up than it is to catch up, and we now all have a front-row seat to experiencing catch-up.


Smarter Growth

Nassau County lacks clear and consistent ordinances that reasonably raise the standards for residential development. Our NCBOCC needs to establish higher minimum standards and consistently apply them countywide. Encouraging high-quality mixed-use development that internalizes many of its impacts, and broadens our tax base, east and just west of I-95, will pay off big time in the long run. Besides, regularly updating impact fees to ensure future growth pays for itself will be needed to ensure future growth pays its share. Higher impact fees may increase costs a bit for those wishing to move here, but it’s essential if we’re to protect existing taxpayers from bearing the burden of future growth. We know impact fees may not be used to cure the sins of the past. Therefore, we’ll need to rely on a combination of higher-than-would-otherwise-have-been-necessary ad valorem taxes, coupled with the judicious use of bond financing to “catch up” on the severe capital deficits facing the county. Hopefully, a lesson is being learned by us all, lest we are doomed to repeat this history.

The county’s consultants have implored our leaders – now for over a decade – to address these issues. Citizens for a Better Nassau County has also, for years, sounded the warning. The time to improve the way we operate is now.

Bill Gingrich is a retired GE executive and chairman of Citizens for a Better Nassau County.