MARCO ISLAND — “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.