LARGO – Largo commissioners unanimously approved a maximum tax rate July 15 that’s slightly less than last year’s rate.
The rate to be published in the property appraiser’s Truth in Millage, or TRIM, notice mailed out to Largo residents will be 5.19 mills, or $5.19 per $1,000 in taxable property value. Commissioners could decide to further decrease the rate when they approve the final tax rate in September, but it can’t be increased.
The maximum tax rate for the fiscal year that starts Oct. 1 is only a slight decrease from the current year’s rate of 5.22 mills. But city management analyst Allison Broihier explained that Largo might be one of the sole cities to decrease their tax rate.
“What we see most of the municipalities doing is leaving their millage rate the same,” she said. “Despite the increase in taxable value, none of the municipalities, at the time of publishing this document, proposed a decrease in millage rate.”
The property in Largo did not increase in value as much as those in the rest of the county, which averaged 6.7 percent, according to city documentation. By comparison, Largo’s overall properties increased by only 5.6 percent.
However, property values decreased for five years, from the fiscal year that started in 2008 until 2013. Any increase, even the slight one last year, was encouraging, Assistant City Manager Henry Schubert explained.
“Over that seven-year period (since 2008), we still experienced an almost 29 percent reduction in taxable values, but at least at this point, we’re going in the right direction,” he said.
New construction and annexations only accounted for a small amount of the increase. That was set to change, given the city’s recent push to catch up on pending annexations.
“We’re anticipating that clearly those numbers will be higher next year when having this meeting,” Schubert said.
The tax rate proposed by city administration, 5.19 mills, is based on the rollback rate, plus a 5 percent overall property revenue increase.
“When we’ve been preparing the budget over the last couple of years, we have made assumptions that the property tax revenue would increase each year by 5 percent,” Schubert explained. “In some cases, that would be due to a rate increase enacted by the city commission. In other cases, most if not all of that would be made up by increase in values, new construction and annexations.
The rollback rate is calculated to allow the city to pull the same amount of property tax revenue as it did in the prior year. Last year’s rollback rate actually ended up pulling in more revenue than anticipated when the final numbers were calculated. Therefore, given that revenue plus new properties gained through annexations or new construction, the final rate the city settled on – allowing them to pull 5 percent more revenue – was still slightly less than the current rate.
The commissioners were supportive of the recommended rate.
“I like the idea of being the only city in the county that’s going to reduce their tax rate this year,” Mayor Pat Gerard said. “For once. Yea.”
Schubert reminded the commissioners that property taxes make up only 28 percent of the revenue in the general fund, which supports administrative expenses, the police and fire departments, the library, most of the recreation budget and some of public works. Given decreases in other revenue sources, the general fund was only increasing its revenue by 2.5 percent, despite the 5 percent property revenue increase
At the currently approved rate, the city will collect an estimated $817,000 in property tax revenue.
Commissioner Robert Murray asked the staff why Largo had lagged behind in property value increases this year.
“We really don’t have a good answer for that. Every community has a different mix of properties. And some properties go up differently in values,” Schubert said.
Murray also asked if the tax rate took into account city employee raises.
“Yes, the proposed assumes a 3 percent employee pay increase,” Schubert said.
The commission will approve the budget, along with the final tax rate, during two public hearings Thursday, Sept. 4 and Tuesday, Sept. 16. The commission will review the budget in detail during a work session scheduled for Friday, Aug. 8, 12:30 p.m.
But Murray emphasized the importance of establishing enough revenue for the employee raises now.
“I think that’s extremely important this year,” Murray said. “There’s a cost involved when there’s new employees that come in.”
The budget is available for review at Largo City Hall or can be downloaded from the city’s website at www.largo.com. Use the link bit.ly/Lrgbudget to find the “Budget & CIP” page.
Also during the July 15 meeting, commissioners:
• Authorized the city manager to negotiate an agreement with the town of Belleair for Largo to provide street sweeping services
• Approved, as the community redevelopment agency, two parking lot paving projects in the West Bay Drive district
• Approved the first reading of an ordinance that allows the city to charge only 1 percent of the initial fee to review the plan of a building, constructed identically multiple times in a single development