MARCO ISLAND — What’s worse, higher taxes, or knowing increases aren’t needed this year, yet appear unavoidable?
That’s the question faced by Marco councilors. Tuesday night, Council voted to increase the tax rate by about 22 percent from last year.
Taxpayers present at the meeting said they wanted budget cuts.
“The cuts can be made. That’s not the issue here. It’s the impact on the future,” said Chairman Rob Popoff.
Councilors Ted Forcht, Chuck Kiester and Popoff opposed higher proposed rates, including the maximum millage rate of 1.85 mils, or $1.85 per $1,000 of taxable property value, set earlier this summer and recommended Tuesday by Councilman Wayne Waldack.
Council eventually approved the rate of 1.7 mils, or $1.70 per $1,000 of taxable property value, although Kiester opposed it.
Two dynamics were leading to councilors’ decisions to raise taxes – the city’s spending cap, which limits spending to no more than 3 percent plus COLA more than was spent by the city the year before, and state laws requiring super majority or unanimous approval for substantially higher tax rates in future years if losses were to be recouped.
“If we lower the millage rate too much we can pretty much forget catch up – forget the cap,” Councilman Bill Trotter said.
Popoff said 1.5904 mils could be considered with little or no problem, but feared the city may never recover from the losses.
“Even 1.7 (mils) would cripple us to some degree,” he said.
Resident Larry Magel, a member of the charter review committee, which is considering a provision to allow council to recover from the spending cap by declaring the current economy an emergency, urged council to forget the cap. His message came to no avail.
“It’s sad because we should be spending based on the situation on the ground today,” said resident Bob Olson.
Olson said Marco should use more county resources and was disappointed with a tax increase two years in a row.
Last year, council increased the tax rate 16 percent from 1.2 mils to 1.39 mils. Marco property owners are looking at about a 30 percent tax rate increase in two years.
Marco, like other Southwest Florida communities, experienced property value decreases the past two years – losing average taxable property values of more than 20 percent when compounded.
“The mechanics of the cap places City Council in the position of either raising taxes when times are tough and values are declining, or creating a spending gap from which we never recover,” City Manager Steve Thompson said.
A possible solution is to budget the use of reserves, he added.
Residents might appreciate the lower, approximate 1.59 millage rate. The city would not spend below the cap because they could budget about $2 million from reserves that wouldn’t have to be spent, Thompson said.
This would buy the city one year, but would not solve the problem of state limits on tax rate increases for the future.
“ ... You’ll never get up to the unanimous vote you need to catch up,” Thompson warned council.
“You don’t need 208 employees or whatever you’ve got here on a small barrier island,” said resident Janet O’Connell, a retired school teacher.
The city currently has 204 employees and in the proposed budget, two to four more employees have been considered for hire.
“I was optimistic when we started to cut 20 percent with the financial planning committee. In reality, you really didn’t cut anything,” said resident Ken Honecker, a member of the committee which met over the winter.
“Yeah you postponed, but I didn’t see true cuts ... I don’t see the energy to truly try and cut the resources and operate on less,” Olson agreed.
In August budget discussions, council agreed to cut $400,000 in general fund expenses and delay large capital projects, such as Veterans’ Community Park and the Smokehouse Bay Bridge.
Andrea Battaglia, a widow on fixed income, said her estimated tax bill increased $800 and with utility rate hikes projected from the city as high as 50 percent in the next five years, she said it was all too much.
“Where do you think the people will get the money from?” asked resident David Crichton.
“The population of the Island is not increasing, so the services don’t have to increase,” said Linda McCune, a member of the Marco Island Taxpayers’ Association.
MITA member Amadeo Petricca acknowledged the challenges council faced with the spending cap and the economic relief people need.
“I know you’re between a rock and a hard place,” he said.
“Our city government seems to have this mentality that we must grow. ... We can’t lose these millions of dollars cause we’ll lose more millions. Is there no time this government can be neutral?” asked resident Karen Glaub.
She said not everything needs to be upscale. “This economy has hurt all income levels,” Glaub said.
Council considered the rate of 1.59 mils, which didn’t need a super majority vote.
“Once you come down, you can’t go back up,” Thompson warned.
Council approved the rate of 1.7 mils plus .0955 mils to pay debt from buying the Glonn property, which is now Veterans’ Community Park.
“I think the next meeting (5:30 p.m. Sept. 21) is when the rubber hits the road with the final number,” Recker said.
“I hope I get real educated in the next two weeks,” added Popoff.
BLOG WRITTEN LIVE TUESDAY
Mike Minozzi led City Council and a large audience, which packed the room at the beginning of the meeting, through the Pledge of Allegiance. Topics for council consideration include the city budget, millage rate, events at the Esplanade with amplified music and further review of what to do with a surplus collection in electric franchise fees.
Chairman Rob Popoff presented Minozzi with a mounted "key to the city" for his service to the city, including working to get the Judge S.S. Jolley Bridge high on the county and state's priority list to get stimulus funding.
Community comment on items not on the agenda
Resident A.K. Battaglia questioned why the fishing pier, which is not to be part of the Jolley Bridge stimulus project, wasn't repaired sooner following damage from Hurricane Wilma about four years ago. She said some funding had been available earlier but not used.
Councilman Bill Trotter said he hopes to discuss the issue at 10 a.m. Friday as a member of the Metropolitan Planning Organization, which will meet in Collier County Commissioners chambers.
Bob Olson, a 20-year resident of the Island, came up with what he thinks will solve the short-term rental issue problems, including noise, trash, parking and over-occupancy code violations. He said a letter upon a first violation stating both thank you for visiting and a list of the rules and fines would be "proactive and positive without creating an extra layer of government."
Police and Fire Academy Awards
Nearly 20 Island children were given awards for their participation in the annual police and fire academy. Check back for photos.
Conservancy of Southwest Florida presentation
Jennifer Hecker of the Conservancy of Southwest Florida is urging City Council support more stringent stormwater runoff regulations. Currently stormwater is greatly degrading water quality, Hecker said.
Regulations presume if you capture the first inch of runoff you're catching 80 percent of the pollutants, she said. However, nitrogen and phosphorus pollutants are still high with these current practices, Hecker added.
The new Southwest Florida Basin rule would require capturing 1 1/2 inches instead of just the first inch, she said.
Hecker urged council support the "basin rule" until supporting the statewide stormwater rule, which is longer term and continues to be delayed, she said.
This is about making developers provide adequate infrastructure for their development, she said. That includes additional fees for infrastructure that would otherwise be paid by taxpaying residents.
Designated waterbody uses, which council will discuss later, is under the clean water act. The classifications currently include drinking water, shell fish harvesting, swimmable/fishable, agricultural and industrial. Drinking standards are, of course, higher than fishable/swimmable standards, Hecker said.
She added that she didn't understand the desire for a new designation that would be splashable, allowable for fishing, but not up to human standards. "We really question why anyone would support such a standard in Florida," Hecker said.
Public Works Director Rony Joel said the cost issue is a big issue. He added more study needed to be done to determine the potential costs of not adding more classifications.
Councilman Jerry Gibson said he was concerned with development along 951 but also about the costs Joel said the city could face without having full details.
"We're down stream from all this. (Developers) get the cost, we get the pollution if it isn't done right," Trotter said.
"That really alarms me that we can't swim in our canals," he added. Trotter wanted to study the issues further.
City Manager Steve Thompson said the city has very little to do with this, but rather state agencies are requesting cities take a stance on the statewide water issues.
Councilman Chuck Kiester and Councilman Ted Forcht wanted the issue to come back with more information in front of them to make a decision.
"The canals are basically clean," Forcht said, questioning if the Island had a water quality problem.
Trotter said it was a disjointed presentation and requested the issue be discussed at the next meeting later this September.
Trotter recalls that the bridge should be discussed in the next meeting. Kiester and other councilors said they recalled putting the project off at least one year.
Popoff said it will be discussed on Sept. 21.
Veterans' Community Park restrooms
City staff is requesting council approve spending money to install bathrooms with hot water, particularly for the Farmers Market, at Veterans' Community Park, Thompson said. The total request is $30,000 for unisex bathrooms, said Parks and Recreation Director Bryan Milk.
Currently Port-o-Potties are rented for $90 per day, Milk said.
"Didn't we have money left from the $100,000 for bridge cameras?" Gibson asked.
"No that went back to the...somewhere" Police Chief Thom Carr responded.
Thompson said it would be looked into. The council approved $43,000 for police vehicle computer hardware to come from council contingency funds.
The city allows 28 events at the Esplanade and last August council approved 28 more special events for 56 total for the year, Thompson said introducing a topic for the evening which has been a controversial issue on the Island for the past year.
Forcht wanted to give 12 permits for amplified music and let the others be "unplugged" or acoustic, causing less noise and trouble, he said.
"I don't think anyone wants to take the music away from them," he said and then added that "the same old solutions to the same old problems" wouldn't work.
Popoff said he thought the complaints were decreasing.
Councilman Wayne Waldack said they could have 365 days of acoustic music, so that's not an issue. He said the Esplanade is good for business and residents, which brought applause from the audience.
"I don't even go there a lot," Waldack said, "...unlike some people," he added as Gibson rolled his head back and looked at the ceiling.
"I do go there a lot," Gibson then said.
He added that decibel readings are down and are under the city's noise ordinance limits.
"I'm stunned that 3 hours in one night in a week... can create this much controversy," Gibson said.
"I think both parties have been very reasonable. I don't see this as a hard decision," Popoff said.
He added that CJ's on the Bay has made improvements.
Year round residents don't have much to do without the Esplanade, residents and councilors agreed.
"It's a little unfair because the seasonal residents in the Esplanade condos aren't here," Popoff said, adding that a decision would be made tonight nonetheless.
"My guess is the majority of you here are here to speak in favor of music at the Esplanade," Popoff said.
The room's occupants answered back with loud clapping.
Trotter suggested allowing for six months until the people come back in December who are most affected living in the nearby condominiums during high season.
Vice Chairman Frank Recker compared the problem to him being annoyed when his dog makes licking noises-- it's not illegal and he can't get rid of his dog for it, but it is a nuisance at times.
Recker said he'd support the extra live music events with amplified sound, continuing to allow the Esplanade to have 56 events every year.
Bill Holmes, President of the Marco Island Condo Managers Association, said he loves having the music and doesn't feel it's too loud.
His wife Pat Holmes agreed.
"We used to go to Fifth Avenue (Naples) Now we don't have to," Pat Holmes said.
Council passed the year of events in a 5-2 vote. Kiester and Trotter opposed. Trotter explained his concern about the residents in the winter months that couldn't share their opinion this time of year.
Kiester shared a decision made prior to the meeting that he would only support "soft guitar, piano or similar type music." He said it was a hard decision because he was aware that Island businesses were struggling, but also wanted to support the residential community.
Gibson said he'd prefer it be permanent and not have to make the decision again.
Forcht's idea to allow 12 events wasn't popular with residents and councilors, who said they feared it would cause the Esplanade to hold those events in-season.
City's property tax rate
Thompson introduced the tax rate for first reading consideration by council. Waldack said he could not support the lowest possible millage rate because of the city's spending cap. $1.1 million loss is expected in ad valorem revenue last year and this year combined causing "sever financial hardships this year and in the future," he said.
The city set the maximum millage rate at 1.85 mils, or $1.85 per $1,000 of taxable property value, earlier this summer.
Waldack called it "financial suicide" without the possibility to recapture the money in the future because the city's spending cap limits city spending to no more than 3 percent plus COLA above the year before.
Waldack said he supported 1.85 mils plus .1 mil for debt service of the purchase of Veterans' Community Park property, formerly called the Glonn property.
His motion failed for lack of a second.
Trotter said he could support a 1.7 mils to give taxpayers the savings from the $400,000 cut at the last budget session in August.
He also could support the 1.75 rate formerly discussed. "If we lower the millage rate too much we can pretty much forget catch up-- forget the cap," Trotter said.
Popoff said 1.5904 mils could be considered with little or no problem, but "we'll create a revenue gap that we may never recover from."
"Even 1.7(mils) would cripple us to some degree," Popoff said.
Trotter said 1.7 mils or 1.75 mils are the viable options.
"If average taxable property value is $500,000 and the city is about 10 percent of the tax bill, the difference between 1.59 and 1.70 or 1.75 is only $50 to $75, year. It's not a lot of money, if you will, compared to the impact to the city," he said.
Trotter said the spending cap isn't the issue because once the lower millage rate is set, a simple majority vote is needed due to state roll back rules.
City Finance Director Patricia Bliss, City Attorney Alan Gabriel and Thompson said they have worked on how to mitigate the problems of the spending cap for several weeks. Thompson said you could budget using reserves "artificially."
"If we substantially spend less than the cap, you'll never get up to the unanimous vote you need to catch up.... You only have enough reserves for one year," Thompson also added as a warning.
Recker suggested 1.75 mils and Waldack seconded.
"I'm not a prophetess from the ancient Roman Empire... The word 'cuts' continues to be ignored by the majority of you," said resident Janet O'Connell, a retired school teacher,who said her predictions of financial distress she mentioned to council last year are coming true.
She added that council was ignoring the middle class. "The bulk of what we're talking about here is what you guys are doing. We want the millage rate to go down... You're going to force me to leave. You don't need 208 employees or whatever you've got here (204) on a small barrier island," O'Connell said.
"Maybe you just want this to be a tourist mecca," she added.
Popoff said it wasn't fair because all City Councilors also pay the bills and do care. "It's real easy for citizens to blame the council for the 10 percent of the tax bill they pay when the rest is the county bill.... I feel your pain. Trust me I do."
"I was optimistic when we started to cut 20 percent with the financial planning committee. In reality, you really didn't cut anything," said resident Ken Honecker, who served on the financial planning committee which met over the winter to look at a city government with 20 percent fewer resources.
Honecker suggested a millage rate closer to the roll back rate.
Resident David Creighton, who said he was a retired CEO of an international firm, said he was on a fixed budget and outlined the struggles of businesses, workers and retirees in the current economy. Creighton said he got his tax bill with a 33 percent increase.
He said council was fiscally irresponsible. "Where do you think the people will get the money from?" Creighton asked.
Bob Olson, a 20 year resident of the Island, said Marco should use more county resources and was disappointed with the increase last year, which went from 1.2 mils to 1.39 mils, plus this year increasing another proposed 25.75 percent with a 1.75 mil rate.
"Yeah you postponed, but I didn't see true cuts... I don't see the energy to truly try and cut the resources and operate on less," Olson said.
Battaglia agreed. "If you maintain the millage rate, you're not losing money, it's maintaining the same. I'm a widow on fixed income," she said.
Her increase was just short of $800 based on the estimated bill she received. Battaglia said with utility increases coming up 13 percent to 50 percent, it's too much.
"You really have to make some deep cuts. I think the cap can be worked out. Under these emergency situations with this economy maybe you can put a hold on these things," Battaglia said.
Popoff asked Bliss to give an example of a $1 million house paying 1.75 mils.
"I got it done. It's too much," Kiester said.
"You talk about the Marco Island tax bill only being 10 percent of the bill.... But it's a lot," said Linda McCune. Her tax bill went up about $600, she said, with most of it coming from Marco's increases.
"For years we were collecting more money than the spending cap... I'm sure the finance department could be creative with their numbers and not worry about the spending cap... The population of the Island is not increasing, so the services don't have to increase," McCune said.
"We have a 3 percent cap... If we're in a recession, what's wrong with going up 2.5 percent. You don't have to tax the maximum amount," resident Bill McMullan said.
"I know you're between a rock and a hard place," said resident Amadeo Petricca, a member of the Marco Island Taxpayers' Association board.
"Cuts, cuts, cuts are needed because people are hurting," he said, adding that the spending cap does cause a problem.
Resident Karen Glaub said she was disappointed. "Our city government seems to have this mentality that we must grow. ...We can't lose these millions of dollars cause we'll lose more millions. Is there no time this government can be neutral?"
She said not everything needs to be upscale when people are hurting. "This economy has hurt all income levels," Glaub said.
The current roll back is 1.65 mils.
Recker recommended his motion again for 1.75 mils and .0955 mils for debt service for Veterans' Community Park.
"I think the next meeting is when the rubber hits the road with the final number," Recker said.
Popoff said if the CIP was delayed one year, $1 million would be saved and all would continue without problems.
"It's not a one year question," Trotter responded, regarding the cap.
Popoff said his wife was laid off at the Marriott, losing a salary and benefits. "I see friends leaving the Island because they have to leave the Island. This is not just a Marco Island problem," Popoff said.
Kiester, Forcht and Popoff said "no." The motion failed 4-3 for a 1.75 tax rate.
"I hope I get real educated in the next two weeks," Popoff said.
The vote needed a super majority.
"The cuts can be made. That's not the issue here. It's the impact on the future," Popoff said.
"Once you come down, you can't go back up," Thompson advised as council discussed a tax rate that didn't need super majority.
Recker made a motion for 1.74 mils and Gibson seconded. Kiester, Forcht and Popoff voted no.
Gibson made a motion for 1.7 mils and .0955 debt service for the park property. Trotter seconded. Kiester voted no. The motion passed 6-1.
Council approved a budget to correspond, which includes about $400,000 in cuts.
Electric franchise fee refund
Council is discussing whether to refund about $1.1 million from surplus electric franchise fees collected by Lee County Electric Cooperative, the Island's electric provider, on behalf of the city.
Recker asked to table due to the a/c being out and the meeting running late. Council approved and the issue was tabled until October.
Recker wanted a proposed scope of work from the utility advisory committee. Gibson preferred a 20 minute to half hour work session with them. We should be telling them what we want, he said.
Trotter said whatever we do, let's not delay the Nov. 6 deliverable on what money is needed. Next is the review of whether and how they should become a permanent standing committee, councilors agreed.
Student Ellie Polling of Tommie Barfield Elementary wrote council requesting wider sidewalks.
Joel responded that the wish will come true in a couple of years with grants to widen pathways to eight feet.
Trotter said he was upset about publishing rumors in the Eagle about two councilors' personal lives. "It's not responsible journalism to create that vicious platform," Trotter said.
"Some of us just considered the source and ignored it," Popoff said.
Waldack urged that there be a youth council.
Popoff would like to review in-house landscaping Sept. 21. "I believe there are real savings," he said.
City Manager communications
Esplanade's permit was open-ended. Recker said his motion was for 56 events. Thompson said it wasn't one year. It automatically extends each year, he said, and council agreed.