Q. Can you explain in more detail why the County’s millage rate was increased at the last County Commission meeting?

 

A. The Clerk administers the budget for the County Commission in her role as Chief Finance Officer. The Clerk must compile information for the proposed budget based on requests submitted by all the constitutional officers, county departments, and other agencies, and by developing revenue estimates. The Property Appraiser is required to certify to the County Commission the taxable value of real property by July 1^st of each year. The Clerk uses the certified value as the basis for calculating a proposed millage rate. The proposed millage rate represents the amount of money per $1000 of taxable property value that will be assessed as ad valorem taxes. Ad Valorem revenue was down significantly because of a lowered taxable value estimated by the Property Appraiser’s office.

 

The property tax roll on which collections are based dropped 26% with the Property Appraiser’s certified taxable value filed prior to July 1^st this year. We received a taxable value comparable to the year 2004/2005 yet we proposed a lower millage rate (the rate then was 4.8684).

 

The Property Appraiser certified the current year taxable value at a figure of $2,057,250,908, so the value of one mill was $2,057,250. You multiply the taxable value by the millage rate to determine what funds will be generated. The County Commission approved a final budget with a millage rate of 4.3511. In last year’s 09/10 budget, the millage rate of 3.6753 was expected to generate $10,210,219.00. In the budget approved for 2010/2011, the millage rate of 4.3511 would generate $8,951,286.00 in ad valorem proceeds - a decrease in ad valorem taxes of $1,258,933.00 even though it was an increase in the millage rate.

 

The entire budget totaled $42,354,108.00; however, ad valorem or property taxes accounted for $8,951,286.00 or 21.13% of the total budget. We must include revenues from other sources such as grants received, the hospital’s surtax, tourist development tax, state revenue sharing funds, etc. in the total budget figure.

 

The Board maintains a Capital Outlay Fund which was being funded gradually to be able to look towards future projects, and during the budget process, $500,000 was cut from that fund by the Board. 

 

In our budget, Reserves for Contingencies funds may be provided in a sum not to exceed 10 percent of the total budget. The County cut the Reserves fund by $250,000 this year. In the first week of their new year, they also obligated $80,592 from reserves to add an additional part-time ambulance, leaving a balance in Reserves of $741,006.00.

 

What happened last week, and has occurred for the past 4 to 5 years, is that when my office received the final certified taxable value from the Property Appraiser which is due by November 1^st of each year, it reflected a 2.11% reduction in property values from the figures we were provided while the budget was being developed. The value of property went from 2,057,250,908 to $2,013,790,897 - a difference of 43 million, 460 thousand, 11 dollars. My understanding is that once the TRIM or Tax Notices are sent out, the Property Appraiser has the authority to make adjustments on taxpayers’ property values when errors are brought to her attention. If she makes a change, it will usually affect all taxpayers’ values in that neighborhood. If there is no agreement, the taxpayers can file a petition to be heard by the Value Adjustment Board. As a result of this reduction in taxable value, the County’s budget is affected, and we’d collect less ad valorem taxes - a difference this year of $189,080, and this is before we get any results from the Value Adjustment Board. Once my office receives the Certification, we have 3 days to act. 

 

In the past, the Board had more funding in Reserve for Contingencies and other discretionary line items which enabled the County to be able to better withstand the lost revenue. I would never make a decision to raise the millage administratively as Chief Financial Officer because this is a decision that should be made by the Board and not the Clerk. This year, my office received the revised value late the afternoon prior to a regular Commission meeting. The Commission needed to be aware of this latest drop in taxable value and be given the option of making further cuts or to administratively increase the millage rate from 4.3511 to 4.4450 - still below the 4.7752 millage rate that went out on the TRIM notices. The County has, since 2007, experienced revenue losses of $921,875 due to adjustments to the tax roll made after certification, and the Commission voted 3-2 to raise the millage slightly this year instead of weathering additional cuts. Several Commissioners pointed out they’d already cut the Reserves during the budget process and had further reduced them again earlier this month by additional funding for the Ambulance Service. Had the Board decided to reduce the Reserve for Contingency line item by the loss in revenue for this change in taxable value, the Reserve balance to fund unanticipated expenses or emergencies would have been reduced to $551,926.