On June 17th, the Florida Citrus Commission will consider increasing the tax rate on juice oranges, the state’s largest citrus commodity, by 71% to 114% in hopes of continuing the recent surge in OJ sales related to COVID-19.
The commission, the governing body of the Florida Department of Citrus, is scheduled to decide on a 2020-21 budget, including a preliminary decision on tax rates, at its next meeting on June 17. The department’s fiscal year begins July 1, but it has until Oct. 31 to make a final decision on tax rates.
The Citrus Department is a state agency that promotes Florida citrus products, primarily orange juice. It is supported primarily by the tax growers pay on every box of commercial citrus harvested.
Although Florida citrus growers have fought tax increases in recent decades, their attitudes may have changed, said Ned Hancock, the commission chairman and an Avon Park grower, on Thursday. “I would say 80% of the growers who have contacted me, they have all talked about the need to capitalize on the trends of recent consumption and that the department’s marketing plan ought to maintain that level,” Hancock told newschief.com. “They understand we’ve got to make a larger investment in our market.”
Retail OJ sales in major U.S. outlets increase 31% in gallons for the four weeks ending May 9, sending seasonal sales since October up 9% by volume, according to a department report. Except for one season, U.S. retail OJ sales have declined continuously since the 2000-01 season.
Hancock said Thursday he doubts the governor will make a decision by the commission’s June 17 meeting, just two weeks before the beginning of the state’s fiscal year.
Further complicating the budget calculation is the issue of whether to spend almost $3 million from unspent budget reserves, as proposed in the staff budget. Spending that much will reduce the department’s budget reserves close to the minimum level set by policy, or 17% of the budget, Marion said.