Lazaro Aleman
ECB Publishing, Inc.
The Monticello City Council last week pulled back on its proposed property tax increase, choosing instead to go with the lower rolled-back rate.
The 4-1 vote to adopt the rolled-back rate occurred in a special meeting on Tuesday evening, July 20, following a discussion that was prompted by Mayor Julie Conley and that at times bordered on testy between her and Councilman Troy Avera.
Conley was the lone nay vote in the earlier decision to advertise the mileage rate on the Truth in Millage (TRIM) notices at the current rate of 7.0258 mills – which represented a 3.4-percent increase over the rolled-back rate.
Conley stated upfront on Tuesday that she wasn’t necessarily opposed to tax increases, having supported tax increases in the past to make some needed public investments and improve the aesthetics of downtown.
“And what a return we’ve seen on that investment!” Conley said. “Every inch of space is either occupied or has a renter or owner waiting to move in when renovations are completed.”
The council’s action, moreover, had jumpstarted investments by the private sector, she said.
“Hundreds of thousands, if not millions, are being spent by the private sector on commercial properties, which in turn, increases our ad-valorem and sales tax revenues,” Conley said.
No less significant, she continued, the city couldn’t keep up with the increased demand for new sewer and water connections, due to the grow in residential construction and new residents coming to the city.
She then noted that even with the rolled-back rate, the budget would still allow for employee pay raises, an increased salary for the new city manager, and a strong reserve fund. All of which, she said, put the city in an enviable position financially.
“And this is all the result of pure, organic growth, not property tax increases,” Conley said.
She read a letter to the council from Scott McPherson, who is behind many of the downtown building renovations and housing construction activity in two previously moribund subdivisions in the city.
In his letter, McPherson expressed bafflement why the city would consider increasing taxes and potentially undermining the city’s growth and revitalization. Home constructions by his company alone, he said, had added more than $120,000 in water and sewer hookup fees to the city, let alone created far higher real estate taxes all around.
“Given the fact that finances of the city are healthier than they have been in years, the budget is strong and there is a surplus in the general fund, I cannot understand why we would penalize our citizens,” McPherson wrote.
Byron Arceneaux, who with his wife, Michelle, owns several downtown buildings that they have renovated, also urged the council not to increase taxes if they wanted to foster redevelopment.
“Monticello is popping right now,” Arceneaux said. “It seems a money grab because you can, if you increase the rate.”
Avera expressed being disturbed by the unwarranted attention that the issue was receiving, holding the newspaper in part responsible for allegedly prematurely publicizing the proposed tax hike.
He also implied that some kind of partnership existed between Conley and City Clerk Emily Anderson to promote the rolled-back rate.
“I know that the mayor and clerk are tight,” Avera said. “But all we did was to set a rate for the TRIM notice, and when we finish the budget, we will set the final rate.”
Per Florida law, property appraisers are required to notify property owners annually via TRIM notices of the taxes that local governments plan to levy in the coming fiscal year, which for the city and county begins Oct. 1. The deadline this year for local governments to submit their proposed millage rates to the property appraiser is Aug. 3.
Noteworthy also is that per Florida statute, taxing entities that don’t adopt the rolled-back rate must advertise a tax rate increase, even if the millage rate remains the same as the current year’s.
The reason is that even if the tax rate remains the same, property owners typically will pay higher taxes because of the increased valuations of their properties. The exception is when valuations drop, as happened during the Great Recession of 2007, when property values declined. In depressed times, the rolled-back rate may then be higher than the current rate, to compensate for loss valuation.
Avera’s argument was once advertised in the TRIM notices, the millage rate could always be reduced at one of the two subsequent public hearings that typically take place in September. What can’t be done once the TRIM notices go out, however, is to increase the mileage rate.
It was his point that the advertised millage rate on the TRIM wasn’t permanent and hence it was premature to say that the city was raising taxes. All it meant, he said, was that the council wanted to allow itself wiggle room, in case unexpected expenses came up before the budget was completed
“If we set the lower rate now we can’t roll it back,” Avera said. “The council has not yet sat down with staff to decide the budget. We need to have a budget workshop. We need to give the chief and city manager a chance to give their input. We can’t run on a shoestring.”
Conley, however, was concerned about the message that the council was sending in the TRIM. People saw what was proposed on the TRIM, not what was intended, she said. And what they saw was a proposed tax increase.
Anderson buttressed Conley’s argument. She noted that her budget calculations, which she had based on the rolled-back rate, showed a $13,200 increase in revenues over the current year. The budget, moreover, met all the departments’ needs with the rolled-back rate, and revenues such as the fuel and sales taxes were trending upwards, she said.
“The rolled-back rate will also bring in more because of increased valuations,” Anderson said.
Councilman George Evans individually questioned Anderson, the police chief and city manager, asking each if they were indeed satisfied with their department budgets. All three said they were satisfied, which Avera said was news to him. But if that was the case, he said, then the council should adopt the budget right then and there.
The council wasn’t ready to go that far, preferring to have one more workshop before finalizing the budget. Meanwhile, on a motion by Evans, the council voted 4 to 1 to go with the rolled-back rate, Avera the lone vote on this go-around.
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