Tax hike will even things out, Marco leaders say

Article Highlights

  • Preliminary budget estimates include 26 percent tax rate increase
  • 2010 proposed tax rate is 1.75 mils
  • Decreasing property values, state sales tax and gas tax among lead factors in rate hike
Steve Thompson

Steve Thompson

— “Holding the line.” That’s how City Manager Steve Thompson describes the direction for the 2010 Marco budget.

The initial draft budget includes an approximate 26 percent tax rate increase from last year. The millage rate proposed by Thompson in the preliminary budget is 1.75 mils, or $1.75 per $1,000 of taxable property value.

Resident and Marco Island Taxpayer Association board member Amadeo Petricca has said that while the tax rate is higher, some increase is understandable with decreased property values and consecutive years of conservative city spending.

If the Collier County Property Appraiser assessed a home to have a $1 million taxable value, then the Marco taxpayer would have paid about $1,392 dollars in city taxes last year. The same home this year, with the average 10 percent decreased home value estimated by the county appraiser, will be paying $1,575 in Marco taxes. The actual increase on the bill, therefore, would be less than $200.

Thompson said during Monday’s council meeting that the city’s budget strategy is for the tax rate to increase but the total dollar amounts collected for 2010 to stay about steady from the previous year.

Thompson delivered a brief, preliminary budget and City Council will discuss the budget in more detail in several planned meetings in August and September. There were no gasps from the audience or councilors following the projected rate increase that came on the heels of the city also delivering a projected 13 percent utility rate increase in the works this October. That increase is to be discussed further by council in August, with the hopes of minimizing the water rate hikes, according to council consensus on the utility issues Monday night.

"It's a staff recommendation and now it's time for council and the community to weigh-in," Thompson said after delivering the brief budget overview.

Other than a request to view the proposed budget by Marco Island Taxpayers' Association members, including MITA president Fay Biles, there was no public comment made immediately following the preliminary budget presentation.

Following the meeting, resident Pat Santiago said she wasn’t shocked or upset about the potential tax rate increase.

“I’d prefer it. It’s tax deductible (on federal income taxes) and better than other fees. It’s the most transparent way to do it,” Santiago said.

Santiago’s sentiments have echoed those of many other Marco residents, who have said in previous meetings that if city costs must go up, then charge for them on the property tax bill and not in other user fees around the city.

Factors leading into the 2010 budget include Marco’s taxable property values decline of about 10.4 percent, according to the Collier County Property Appraiser’s office earlier this summer. Also state contributions, including sales and gasoline taxes, are down by about 12.6 percent, leading to about $430,000 income loss to the city.

Marco salaries will be frozen and the total budget, including all funds, is estimated to be about $89.5 million, down about $8 million from the year before. The general fund, supported primarily, 77 percent, from the tax rate, is up about $700,000 from the year before.

The budget includes nearly $15 million in capital projects, five times that in the 2009 budget. Some of these capital projects include bridge repairs, but the delineated budget was still in the works and not available as of Monday’s meeting.

The rate of 1.75 mils maintains current service levels and covers increases in pension and insurance costs, Thompson reported.

Staff cost increases are to include two finance personnel, environmental services to go from part-time to full-time, a code compliance person and two permit clerks vacant in building services. The cost of these positions was not yet available.

Council voted unanimously in mid-June to set the maximum possible 2010 tax rate at 1.855 mils or $1.855 per $1,000 of taxable property value. Councilman Bill Trotter had said the goal was to coordinate a budget working with a tax rate in the range of 1.7 to 1.75 mils, but set the maximum to allow flexibility.

The 2009 tax rate was 1.3917 mils, or about a 10 percent increase from 2008. The rate proposed by Thompson equates to another consecutive annual increase—this time up about 26 percent.

Despite the tax rate increases, Marco continues to be a rarity in the state as a city which “holds the line” in large part because of their annual spending cap, which limits spending to no more than 3 percent plus COLA more than the year before.

In 2009, the city approved a budget under their maximum spending cap for the first time in the city’s approximate 11 year history.

The city portion of Islanders’ property tax bills will also include 1 mil or $1 per $1,000 of taxable property value to pay for debt on the Veterans’ Community Park property purchase. Thompson said the city will be paying off this debt until about 2020.

Council will need to finalize this in September.

The city’s proposed millage rate will go to the County Property Appraiser’s Office August 1. Residents are to get the proposed tax bill from the County Property Appraiser’s Office in late August.

Detailed work sessions on the budget are scheduled Aug. 5 and Aug. 12. Formal public hearings are scheduled September 8 and the final budget and millage rate is to be approved at the Sept. 21 meeting.

© 2009 All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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Comments » 10

happy6 writes:


marcoredeagle writes:

What prudent City would be adding new positions in 2010?

The City doesn't get it. They have added more positions each of the last two years ... probably more years but I didn't research this before I posted.

August8 writes:

"Allright", Please Itemize the ways the City will reduce current costs in terms of each individual Department, Itemize please!!!!!!!!!!!!!

happy6 writes: might have to start looking for another city to scam..and take the council with you.

sailingalong writes:

Thompson calls a 26% tax rate increase along with the 27% utility rate increase needed to fund 19 million in capital projects for 2010 as "Holding the Line" and poor Kelly is dumb enough to swallow the BS without even questioning it. Ed Bania never would have swallowed this tripe.

MrBreeze writes:

I keep saying it, things will not change until people vote for change.

u2cane writes:

Instead of freezing salaries, why not reduce salaries by 10%? Many businesses around Collier are having to do it, why not government? I mean you have less money coming in, so it makes perfect sense.

u2cane writes:

Mr Breeze I agree with you, but lets face it, people in this country care more about American Idol then they do about what is going on in politics and government. Until we can change the apathy of a majority of voters, we will have done nothing. Elections are like popularity contests and people tend to vote for the person, rather than the issues. If election ads had to be checked for facts before being run we would all be better off. We need more people to speak up to change politics in our country.

EdFoster writes:

Let's see if I understand this. Adding 5 1/2 people to the staff and quintupling the capital improvement budget is considered "holding the line" on Marco. Our homeowners association is deferring all "nice" capital improvements, making only essential changes, reducing unessential services and paring the labor force so we'll be around to make and enjoy the improvements when the economy recovers.

Only on Marco would increasing the ad valorem tax rate by 26% and the utility rate by 13% be considered "holding the line." Our HOA has an assessment cap based on COLA too and we adhere to it. Our assessments will rise slightly (but within the cap) because the rotten economy has affected house sales and reduced initiation fees, a major source of income. When things get tight we control expenditures. We don't play Musical Money.

Marco's general fund is up $700K but the budget, which presumably includes quintupling the capital-improvement allocation and adding 5 1/2 people to the Empire, is down $8 million? Something doesn't compute! More Marco Magic?

Isn't it interesting that when Marco property values were rising, the Council took such pride in claiming to reduce "taxes" (actually the tax rate was reduced; tax revenue ALWAYS increased) but now excuses itself from raising the tax rate 26% because property values have fallen 10%. You put some money in and you stir it all about .....

Marco Magic no longer affects me but I thought to remind my friends on the island that there ARE ways to control expenses in tight times. Hint: it's not done by electing leaders who make such oxymoronic statements as a "Tax hike will even things out!"

Ed Foster

dwbadger writes:

Increasing capital projects is not holding the line. When business' see a decrease in revenue they reduce expenses, they do not hold the line. Salary reductions, benefit reductions, postponement of capital projects, etc are all considered. It's time our island becomes upset over the continued rate increases.

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