MADEIRA BEACH — The city’s millage rate will remain unchanged for the coming year. The decision to leave the rate where it is came at the final budget hearing Sept. 23.
The City Commission had voted at the two previous budget meetings to set the tentative rate at 2.875 mills, a slight increase, to bring in more revenue and make up for potential income losses, mostly due to declines in the city’s tourism-based economy as a result of the COVID-19 pandemic. So the decision to leave the rate unchanged, at 2.75, was a surprise.
It came after Commissioner Doug Andrews announced at the beginning of the budget meeting that he could not support increasing the rate. The vote had been 3-to-2 at the previous meeting to raise the rate, with Andrews voting yes at that time.
He said he had “done a little soul searching” and had a “change of heart” on the issue.
Andrews then gave a number of what he said were examples of excessive and wasteful spending by former city officials and commissioners, which he called “a lack of fiscal responsibility at all levels of the city.”
Now, Andrews said, “We can’t turn around to our residents and stick them with the bill.”
“It’s accountability time, and we have to tighten our belts and figure out how to do this without raising the millage rate,” he said.
Commissioner Helen “Happy” Price said she continued to support the small increase in the millage rate.
“I have a different opinion, and I’ll take full responsibility as the person who wanted to raise our millage rate,” Price said. “We got hit hard with no parking income for several months during this coronavirus mess. If we want to fix things, we are going to need a little increase.”
Price said other communities are raising their millage rates.
“We need to do this,” she said.
Price then named the projects and expenses the city faces. “All that takes money,” she said. She noted Madeira Beach’s millage rate is already a lot lower than other nearby communities such as Treasure Island, St. Pete Beach, and South Pasadena.
Mayor John Hendricks, who had consistently opposed raising the millage rate, said, “We need to tighten our belt, not loosen our purse.”
A motion by Andrews to leave the rate unchanged at 2.75 mills was supported by Hendricks and Commissioner John Douthirt, who had already voted previously not to raise the rate, plus Commissioner Nancy Hodges.
That left only Price voting no for the 2.75 mills. She continued to favor raising the rate to 2.875.
The city budget for the coming year had been based on the expected revenue generated by the higher tax rate, so the decision to leave the rate unchanged left the commission members scrambling to look for ways to cut the budget and make up for the lower income forecast.
The final budget meeting, which normally lasts only the few minutes needed to vote for the millage rate and budget, stretched to over an hour.
Andrew Laflin, the city’s financial consultant, said, “At the 2.875 rate, the General Fund is balanced. At the 2.75 rate, it is about $187,000 short.” He suggested a solution could be to take the needed funds from reserves.
The commission looked at several possible budget cuts, including not purchasing a new sanitation truck costing $200,000. Hendricks said the truck, which would be used to collect trash from receptacles on the beach, is not essential. “For years, we have used a pickup truck or a truck with a dumpster on the back, and we can continue to do that,” he said.
In the end, the commission decided to take $200,000 out of the money budgeted to buy fuel for sale at the marina, a recommendation made by Andrews. He said the budgeted amount was significantly higher than this year, and may be overestimated because of uncertainties about the price of gas.
“Why can’t we forecast a little less? There’s still a $500,000 buffer (in the marina budget),” Andrews said. He acknowledged the uncertainties of gas prices and level of sales in the time of a pandemic, but said if it turns out they need to buy more fuel, that can be handled with a budget adjustment later.
Andrews said that solution “is clean, it is easy, and we can do it in one quick swoop, instead of cutting a little here and a little there.”
The commission passed the amended budget, with the amount reduced needed to balance it, by a unanimous 5-0 vote. The total budget approved was $18.1 million.