I am one member of a five person board. The opinions I express on this forum are mine only, and do not necessarily reflect the views or opinions of the Escambia County Staff, Administrators, Employees, or anyone else associated with Escambia County Florida. I am interested in establishing this blog as a means of additional transparency to the public, outreach to the community, and information dissemination to all who choose to look. Feedback is welcome, but because public participation is equally encouraged, appropriate language and decorum is mandatory.

Wednesday, December 12, 2018

How $92 Million Was Given Away, and Nobody is Held to Account, Part II

Fixing the beach lease renewal process will help stem the subsidies from Escambia County Taxpayers for expensive properties on Pensacola Beach...

As we explained in Part I, the SRIA renegotiated two large condominium leases in 2016 that will result in $92 Million in unrealized income for Escambia County taxpayers over the term of those leases.

Congratulations to the individual owners of these condominiums for being on the positive side of such a favorable deal!  Good on ya!

But Escambia County and the SRIA are the losers here, because this creates a situation where millions and millions of dollars have been left on the table.  And taxpayers of Escambia County are and will be the losers.

Right behind these two 2016 condo complex renewals will come many more.  If we don't modernize the fees and standardize this process, just imagine how much revenue will be left "on the table" when these condos come in for renewal-----if we leave the rates unsustainably low as was the case with Beach Club and Emerald Isle??

That's why the disastrous method utilized currently to "renegotiate" these leases must be standardized and fixed on today's market rates.  Otherwise, Escambia County taxpayers will continue to absorb the subsidies that are being given to beach property owners via overly generous lease renewals.

How, you ask, does this affect Escambia County taxpayers?

Here's how.

Many of the services provided on Pensacola Beach are subsidized by Escambia County.  The less the SRIA takes in via leases, the more the county will have to pay (subsidize).  It is inversely proportional.

Here are some current examples:

Above:  A comparison of taxes paid by beach properties compared to mainland properties

Public Works and roads crews for Pensacola Beach  $2.5 Million Dollar subsidy from Escambia County Taxpayers

Via De Luna resurfacing?  $1.3 Million yearly paid for from County Funds.

Sheriff's Law Enforcement Services?  Subsidized more than $50,000.00 per year by Escambia taxpayers.

So we have to fix the lease renewal process going forward, we must.  This is the only way to insure everyone is paying a proportional amount for the services received.

This is an important issue I will stay-on until it is fixed.


Anonymous said...

Wow you are "on" it tonight. Thanks rest up. Big day tomorrow in AM.

WRay said...

Commissioner Bergosh,

Aren't there more streams of revenue that come from the beach to consider in your analysis? Bed taxes, sales taxes, and SRIA taxes all add to the bottom line into the county treasury don't they? As Pensacola Beach generates much more than just property taxes and MSBU, could you provide a complete overview of what is generated at the beach versus how much is spent by the county at the beach? Police, fire, and DPW (roads, lights, sewers, and more) are NOT just there to provide for and protect the residents at the beach, they're also there for all from the county as well as the thousand of visitors that come to play at the county's biggest park every year. I don't believe you can show a spread sheet with only MSBU to make your case. I think a complete look at all funding from the beach and how it is spent county wide would be helpful. Maybe that can be your "Part III"?

Bill Ray

Jeff Bergosh said...


Thanks for the response, and I do not disagree with the fact that the beach is a HUGE wellspring with respect to revenue generation (LOST, Bed Taxes, Sales Tax). But that is, indeed, a separate conversation. I am strictly focusing on SRIA lease fees for this analysis--and as you know or as anyone would know by watching the presentation I gave yesterday at the BCC---that is complex enough in and of itself. Conflating that revenue and what that revenue could be used for with issues of LOST and Bed Tax revenue would not be helpful to the point I am trying to make. Obviously, Pensacola Beach generates an inordinate amount of revenue that benefits the county--particularly less wealthy portions of the county that produce much less of all types of revenue. But that is not an uncommon phenomenon; look no further than the state formula for funding schools via "equalization" where wealthy counties have to put in $1.25 for every $1.00 they get back, and poor counties get $1.00 for every $.75 they send to Tallahassee. A gross oversimplification, but that is the general practice. Same locally. And the poorer the neighborhood---often times the MORE services such areas consume. At least Pensacola Beach has SRIA with dedicated funding streams that cannot leave the island. And on top of that, the County IS subsidizing public works, road paving, and the sheriff over and above what is generated on the island. If the lease fees are set at a modern level with an escalator clause, perhaps these subsidies go away, and then we could even end the "double taxation" out there, where some individual houses are paying full ad valorem on improvements and land PLUS lease fees. If we fix the condo renewal rates, I will Push to end the double taxation on the beach. But that revenue has to, and should be, generated from realistically priced lease fees for the Million Dollar Condos that will be coming online or up for renewal over the next several decades. No more $184 dollar a year lease fees for Million Dollar Gulf-front condos Bill.......