It's Your Money

By the time this is published on December 17 th two extremely important decisions will have been made that have a profound effect on the taxes you pay over the next few years. These decisions were made on Tuesday December 15 th by the two most important elected bodies in the County, the Martin County Commission and School Board of Martin County. At this point we are going to assume that both groups will make the correct judgments and discuss the consequences of those decisions.

The Commission will (we hope) have killed the effort to institute Stormwater and Fire Service Assessment fees for all of unincorporated Martin County – at least for the next budget cycle. These “fees” would avoid the constitutional restrictions on property taxes and allow virtually unchecked increases in spending for those services. Also, the fees would be totally based on “requirements” determined by those receiving the funds. This (hoped for) decision is good for taxpayers, especially businesses, agricultural interests and reduced/exempt taxpayers and institutions. However, it will be the source of serious difficulties for the County Administration given the revenue shortfalls resulting from the current economic downturn.

The final accounting of taxes and fees collected for the 2009 fiscal year that ended September 30th highlights the situation.

Martin County - Local Revenues in dollars

Property Taxes - 141,310,419 - 142,949,414 - 1,638,995
Impact Fees - 2,510,700 - 946,924 - (1,563,776)
Building Permit Fees - 2,500,000 - 1,771,679 - (728,321)
Ambulance Fees - 3,404,325 - 3,384,314 - (20,011)
Tourist Tax - 1,186,487 - 1,022,514 - (163,973)
Dev. Review Fees - 2,002,000 - 695,836 - (1,306,164)
Interest - 5,293,113 - 2,980,797 - (2,312,316)
Totals $158,216,044 - $153,751,478

SHORTFALL ($4,464,566)

The bottom line is that the County completed the last fiscal year nearly $4.5 million in the red and has revenue projections for FY 2010 of just over $145,000,000 – down another $9,000,000 from FY 2009 actual collections. In addition, the property valuations that will be the basis for the 2011 property taxes will be finalized in less than a month and unofficial but informed projections are for a further $12 million decrease in the resulting revenue collections.

Maybe our State and local economies will improve and those receipts will be better than projected – we certainly hope so. However, the indications are not good and there are only two options available: cut expenditures or raise taxes/fees. In today’s economy significantly raising taxes would be self-defeating – and intolerable to voters. That leaves three questions that the Administration will have to answer to solve the shortfall:

What are the most effective alternatives to reduce spending?

Which of these have the least effect on essential services?

What political decisions will the Commission make?

Our Emergency Services (Sheriff and County Fie/Rescue) are now taking over 70% of the budget, and the Fire/Rescue size and expense is continuing to grow as all other County functions are forced to decrease. This is unsustainable and no cure to this situation is in sight. One of the options that the commissioners may wish to consider is outsourcing some or all of the Department’s services as have been implemented by other Florida cities/counties. There are many other viable answers to reduced spending without cutting essential services. We will make specific recommendations as soon as the official 2011 budget figures are released and will certainly monitor and report on the Administration/Commission decisions.

----------------------------------------------------------------------------------------------------

We also applaud the School Board’s approval on the 15 th (we hope) of the recommendations that allow hiring of the well-qualified individual that the Superintendent has put forth for the District’s Executive Director of Finance. The last director retired in January 2009 and the Board downgraded the job description to director and commensurably reduced the pay for the position. The first individual that accepted and was recommended for the position was rejected for cause. An interim director was appointed and consultants were brought in to complete the 2010 budget that was required by 1 July. Numerous attempts to fill the position at the “director” level were unsuccessful due to a lack of qualified applicants. The Board has now raised the job level and pay back to the previous “executive director” level, which allowed the position to be filled. Even though this increases the salary by some $9,000 annually, it also allows the expensive consultants to be rapidly phased out.

Having this position filled is crucial as the district faces the same type budget shortfalls and decisions as those plaguing the County. They will have State and Federal grants that will help, but they are also dependent on the same Ad Valorem property taxes and the State is also forecasting a budget deficit.

There is also the continuing phased adoption of the class size reduction mandated by the voter approved Constitutional amendment. The next phase requires that every classroom meet preset levels – not averaged across the entire school or grade level. We are lucky that we have sufficient physical capacity without building new classrooms/schools. However, it will require many new teachers, increases in the school budget and probable movement of students between schools.

In “thanking” the Commission and Board in advance (as this is written) we hopefully have not jinxed the outcome of those decisions. However, we want our members and readers to understand and appreciate the seriousness of the economic problems being faced by our elected officials and offer a timely “thank you”.