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City officials propose higher tax rate
Mayor opposes millage increase despite projections of falling revenues
By LESTER R. DAILEY
Article published on Wednesday, July 16, 2008 |
CLEARWATER – The City Council July 17 was expected to set the city’s proposed millage rate for the upcoming fiscal year. The city’s numbers crunchers have suggested a rate of 4.95 mills.
A mill is one dollar of property tax for each $1,000 of taxable value, and the city’s current millage rate is 4.67
“The (proposed) millage rate is an increase from last year, but when combined with reduced property valuations and other factors, it will equate to a tax reduction for most people with homes valued at $350,000 or less,” Joelle Castelli of the city’s Communications Department explained in a press release. “Even with the increase, the budget will be reduced by $21 million in the coming year.”
But Mayor Frank Hibbard is opposed to any hike in the millage rate, even if keeping the current rate would necessitate further cuts in city services.
“I am going to push hard to keep the millage rate that we have,” Hibbard said at the July 14 City Commission work session. “These are not just numbers; these are people’s jobs and lives. We want to be sensitive to that.”
The city has found itself in the same position as many of its residents. The price of fuel, electricity and other commodities are skyrocketing, and income has failed to keep pace with the increases.
“All of our revenues are falling or flat,” budget director Tina Wilson explained, adding that keeping the current millage rate would require $2.8 million in budget cuts beyond those already proposed. “We have stepped up the (millage) rate to partially offset the decrease in (real estate) values . . . I do think we’re in for a couple of tough years where the (real estate) values of Clearwater and the surrounding areas will fall. Our taxpayers, as a group, have seen their property values fall.”
The appraised value of Clearwater properties dropped 8.7 percent, from $11.2 billion to $10.2 billion, in the past year. The drop would have been greater if new construction had not raised the value of some properties.
The city has already made deep cuts to compensate for its rising costs and falling revenues. For example, there is a freeze on all hiring except police officers, firefighters and certain critical positions. Councilman John Doran fears that the fat has already been entirely cut out, and using further cuts to balance the $377 million budget will cut into the muscle.
“Everything that we cut last year will be gone,” Doran said. “Everything we cut this year will be gone, and we’ll have to make further cuts next year” if the millage rate isn’t raised.
City Manager Bill Horne said that, if city officials had had a crystal ball a decade ago and could have foreseen today’s budget crunch, they might not have used Penny for Pinellas funds to build new fire stations and other facilities.
“Now we’re facing the reality that we may not have the money to operate those things,” Horne said.
Even if approved on July 17, the 4.95 millage rate will not be chiseled in stone. It is merely a proposed rate that must be filed with the county property appraiser by July 30. The actual rate will be finalized at public hearings on Sept. 4 and 18.
“We can always set it lower in September, but we would not want to go higher at this point,” Wilson said.
Hibbard reminded residents that Clearwater’s property tax is only a small part of their actual tax bill.
“People need to understand that a little less than a quarter of their tax bill goes to the city,” he said.
About the budget
According to the city’s budget:
• City officials plan to cut 20 full-time positions as part of their budget for the next fiscal year.
• The general fund or operating budget is $120.9 million, a decrease of 2 percent from the current budget.
• Police and fire department overtime budgets have been reduced $750,000.
• The budget also reflects reduced hours of operation at the city’s aquatic centers. Funding for some special events has been cut.
• Increased fees for sports tournaments and increased camp fees also are proposed.
• Public hearings on the budget are set for Sept. 4 and Sept. 18.
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Article published on Wednesday, July 16, 2008
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