CLEARWATER — There was little discussion Sept. 3 when the City Council voted to approve the fiscal year 2021 budget and keep the property tax rate unchanged.
Council members will have to vote on them a second and final time Sept. 17, but there will be plenty more discussion about them in the future as the pandemic and major financial obstacles lie ahead.
“Due to the unknown impacts of the pandemic into the next fiscal year, we’ve taken a conservative approach to budgeting several revenue categories that might be affected,” said Kayleen Kastel, the city’s budget manager.
Part of that approach was recommending maintaining the property tax rate at 5.955 mills, with one mill equal to $1 for every $1,000 of assessed property value.
Council members followed that recommendation Sept. 3 and voted 5-0 to keep the rate unchanged.
The Pinellas County Property Appraiser’s Office reported that the city’s property values as of January jumped up to $12.7 billion, 6.7% more than last year.
Kastel said that means keeping the current rate will generate $71.9 million, or $3.8 million more than last year.
It also means a resident who owns a homesteaded property with an assessed value $102,300 will pay about $13.70 more this year.
It’s unlikely the millage rate will remain unchanged in future years, though.
In June, budget officials informed council members that the city will need to increase the rate to 6.91 mills in 2025 and keep if there or risk running a deficit in the city’s reserves.
This year presented its own set of challenges.
The $539.2 million budget, with $152.1 million of that in the general fund, was 3% less than last year. It includes 1,837.6 full-time equivalent employees, which is one more than last year.
Kastel said 31% of the general fund was dedicated to the police department, and that number increased when the council in July approved a $2.56 million body camera program.
The program meant the city had to fund a senior records clerk for the department and try to offset 294,300 in costs next year.
The pandemic also forced the city to make adjustments as revenue declined.
For instance, intergovernmental revenue, which includes sales tax, dropped 20%, or more than $4.7 million.
The pandemic has also taken a heavy toll on bed tax collections, which will play a big factor in upcoming decisions on costly capital projects, such as spring training facility upgrades for the Philadelphia Phillies.