“Nobody trusts government on any level anymore.” City Council Vice Chair Larry Magel sums up the collective headwinds facing anyone wrangling public money these days. Magel, along with fellow councilors and budget subcommittee members Wayne Waldack and Bill Trotter, spent 37 hours meeting with city staff, studying the fine print, and voicing opinions on proposed items in the 2012 budget created by the city as manager and staff worked to create something to pass muster with both public and city council.
The challenge: nearly all public money in Florida rides on the back of property taxes. The state has no income tax, and minimum taxes on spending for gasoline and tourism. Which means that the quality of necessities like roads, education of our children, and public safety depend on a real estate market that continues to founder; the county’s appraiser’s office expects Marco values to decline another 8.07% in 2012.
The millage rate is the percent of property value that will be taxed to pay for public services. It’s proposed by the city and approved by council vote. On the preliminary TRIM notice tax bill, it’s 2.07 mills per thousand of assessed valuation. At the last City Council meeting, city manager Jim Riviere was directed to re-create a lower budget and has officially submitted a revised budget based on 1.99 mils per thousand instead. Council’s final vote on the millage rate approved 2.07 mills pending a second meeting at which time council will review reducing reserves and moving 6% water and sewage charges to ad valorem to bring the rate down.
Some homesteaded owners won’t see taxes drop as values drop thanks to state’s “recapture rule.” If for some reason your homestead value is less than market value, the state requires the tax appraiser to raise the assessed value until both are in line.
Of the funds raised by your property tax, about 84% goes to Collier County, and according to county budget analyst Mark Isackson, “the city gets a great return on their investment if the county spends in excess of $223 million for the services [Marco receives:]” beyond the schools, trash collection and mosquito control on your bill, these include EMS, the medevac helicopter, parks, the library, roads, the courts, water pollution control and all county government offices.
“You do cross the bridge,” points out county commissioner Donna Fiala.” We have no idea how good it is here until we compare it to other places.” Fiala, who owns property in Ohio, is herself frustrated with the combination of higher taxes and poor quality of services she’s getting for her money up North.
Marco’s 16% has been squeezed and contested, and despite misconceptions, the city has run a budget surplus in its general fund (where main city services are paid from) in fiscal year 2010 and will do so again in 2011. The staffers who serve the residents have foregone any raises. The debt against it is in no way onerous.
Patricia Bliss, finance director for the city points out the city’s high fiscal ratings: Fitch, AA+, Standard & Poor’s, AA, Moody’s, AAA. “The city’s AAA rating was not impacted when Moody’s placed 162 local governments on a watch list for downgrades in response to the rating action on the US government. I was informed that our financial resources, operating flexibility and management responsiveness…offset the risks [of the US downgrade.]”
If the point of a budget is to allocate money ahead of time for the equipment and projects the city completes, why the hue and cry every time a city staffer buys so much as a pencil?
“Do people from Marco go to county or the state to demand oversight on those budgets? No, this is the locus of control,” points out Magel, who appreciates the worries of seniors who feel squeezed by rising costs of living on the island.
Demographics probably do play a role in what’s considered non-essential spending. There are no improvements to Mackle Park in the budget, and the possibility of a new community building resulted in accusations of waste. However, a line item in the 2013 projected spending provides $1 million for Veteran’s Park improvements and a memorial.
Not included in the budget: key capital projects that keep infrastructure like bridges and roads healthy. Although the city waits for better days and more money from property taxes, waiting until things become shabby will not entice the buyers who will shore up property values.
Magel, for one, takes the cautiously pessimistic view and appreciates the city manager’s efforts to build reserves. “If 2012 and 2013 don’t show us the economic recovery we are all hoping for. If things get worse, if there’s a depression, how will you keep the city running? We need the reserves.”