Planning Session Reviews Budget
The Fort Myers Beach Town Council, at its August 15 Management & Planning Session, led by Council member Bruce Butcher, provided a thorough review of the Town’s proposed 2019-20 Fiscal Year Budget. Following this, Council member comments seem to indicate that they will approve an Ad Valorem Property Tax increase during their September Budget Hearings, raising the current .87 rate potentially to the .95 Truth In Millage (TRIM) figure set at the June 3, 2019 Meeting.
Ad Valorem Property Taxes are based on $1 per $1,000 of property valuation, meaning Fort Myers Beach residents currently pay 87 cents per $1,000 that could increase to 95 cents per $1,000. Council FY19-20 Budget discussions are Mondays, September 9 & 23, at 5:01 p.m. For example, the owner of a Fort Myers Beach house valued at $300,000 pays the Town on the current .87 figure $261 in Property Taxes; the proposed .95 rate would increase that to by $24 annually, to $285.
Town Staff based their proposed Balanced FY19-20 Budget on current .87 rate, including all potential Add On Items. Council, however, engaged in a discussion about eventually replacing the Bay Oaks Recreational Center along with other improvements, possibly leading to a savings program to fund these over a number of years.
The proposed FY19-20 Balanced Budget totals $17,232,540, with the General Fund amounting to $7,069,140; Beach Water Utility Fund $5,606,820; Building Services $952,325; Beach Access & Shoreline at $1,135,230; Gas Tax $623,000, Capital Improvements $566,025; and Stormwater Fund at $1,280,000. The .87 millage would generate roughly $3 million, with the .95 TRIM rate an estimated $250,000 on top of that. Council weighed an additional $1,127,250 in Add On Items, such as Public Outreach & Marketing, Comp Plan Review Consulting Services, & Capital Improvement Projects that Staff estimates it can fund under the current .87 Property Tax figure.
Council provided input between the .87 versus and .95 rates. “I believe we should leave the millage at the proposed .95 mark,” said Mayor Anita Cereceda. Council member Rexann Hosafros stated, “Following these discussions, I lean toward the higher rate.” Vice Mayor Ray Murphy and Butcher each added, “Leave it,” meaning the .95 figure. Only Council member Joanne Shamp left wiggle room, saying “my personal position is it should be somewhere between that and the current point.”
“I am pleased to present the proposed Fiscal Year 2020 Draft Budget,” stated Town Manager Roger Hernstadt. “I say ‘draft’ because this allows Council to provide further direction, and of course we still have the Public Hearings. From the Staff perspective, we can maintain our current level of services under the current millage, with slightly over a 3% growth figure. I do have one update, however, from your printed material: we estimated Federal Emergency Management Agency (FEMA) out-of-pocket reimbursements to the Town from Hurricane Irma at $400,000; we now have roughly $558,000 with FEMA still evaluating additional Town requests.”
“Let’s go down the line with budget questions,” began Cereceda, starting with Butcher. For the next 100 minutes, punctuated occasionally by questions and comments from his fellow Council members, Butcher took Staff through an in-depth examination of the proposed FY19-20 Town Budget, including clarifications on the Local Gas Tax, Impact Fees, Capital Improvement Projects, Reserve Funds, Water & Stormwater Rates, Public Works Items, Building Permit Fees, General Services, Town & Contract Employee Wages & Benefits, FY18-19 Carryover Surpluses, Fines & Enforcement Changes, Special Magistrate Fees, Banking Charges, Community Development, Short Term Rental Fees, Law Enforcement Programs including Maritime Patrols, Tourism Development Council Funding, Grant Moneys, Parking Fees, Bay Oaks Recreational Center Improvements, Town Vehicles, and additional items.
Following Butcher, Murphy stated, “Bruce asked all of my questions and 100 more! That was very thorough, so thank you!” He however requested that Council appropriate $10,000 to purchase water quality testing equipment for the “Commercial Waterman” Non-Profit Group from Matlacha that Council tentatively approved, though Shamp opined that this runs counter to its policy of allocating funds to Non-Profits.
Hosafros noted, “Bruce asked most of mine as well,” though she sought clarification on a 2% Health Benefits allocation to the Town Manager, to ensure it is appropriate in his contract. She questioned as well if Council needed a $16,900 Travel Expense or $5,300 Promotional Activities budget lines, as Councils historically never need that much, but her colleagues disagreed, saying they cannot anticipate expenses for the next Council that may have up to three new members and a new Mayor, with Cereceda term-limited out, following the March 2020 Town election.
Council then examined Add On Items for the draft FY19-20 Budget, including trolley bus shelters & benches, new Bay Oaks minibus & playground, Mound House National Register Celebration Day, sidewalks near the Beach Elementary School, Stormwater Reclamation Projects, ADA Transition Plan, Crescent Street Traffic Signal, and additional items totaling $1,127,250. Shamp asked for confirmation that Council can fund all Add On Items at the current .87 Property Tax Millage Rate, with the Town Manager replying in the affirmative.
New Bay Oaks?
Hosafros noted, “The elephant in the room comes from the Bay Oaks Recreational Center Advisory Board (BORCAB) that says Bay Oaks needs a major renovation or replacement. That is more than the Town can afford in any one current year, so we should set aside money to save for that future.”
Shamp stated, “I will take an opposite view – that being said, I am a Bay Oaks fan! There is an estimated 10 to 12 years of life left on the building. I understand the questions of if it suits the needs of the community and if it is the optimal design for that property, but we are talking about millions of dollars for a new building. For that amount of money, we must go to a referendum, so it is too early for this. It is not in our purview to create an account for something we may do.”
Hosafros countered, “It is the financially prudent, rather than hitting people up with a big fund of money; it is prudent to save money for this.” Butcher noted, “Bay Oaks has been in a ‘contain & maintain’ mode for a long time, so we ought to start saving; otherwise, at some point, we will have to borrow a bunch of money. The proposed millage increase will allow us to bank a surplus of $250,000 per year.”
“Joanne, I am glad you brought this up,” said Cereceda. “At the new proposed millage, my Town tax bill will only go up a little more than $30 a year. The nature of the Town is changing and we cannot continue to be a ‘pay as you go’ community forever, but must become a ‘save as you go’ community, to do what we must for our future; the future will be here tomorrow, and we will not be ready. I love the word Rexann used because it is one of my favorite words – ‘prudent!’ I am glad you raised the issue, though, as a significant part of the community will say that.” Hosafros stated, “My Town taxes will go up $21.98 for the entire year; people spend that on a couple cups of coffee and a bagel!” “Point well made,” agreed Murphy.
Shamp asked Town Attorney John Herin, Jr, if the Town can legally bank money for a specific project. Herin said, “Council can bank General Reserve Funds for whatever purpose it desires, but you cannot restrict its use. A future Council can redirect those funds for whatever it desires.” The Town Manager added, “If this Council begins to save money for a new Bay Oaks, and the community basically supports that, a different Council will face a tremendous amount of scrutiny if they make that decision. The Town can use this as seed money to borrow more money, as it is tough to save enough for a multi-million dollar building.” Murphy noted that banked money can be for matching grants, saying, “You raise that type of cash through a combination of ways.”
While Butcher favors a reserve fund, he has a concern over saving money “for a building we have yet to determine. Don’t put money aside for Bay Oaks, but to improve the Quality of Life on Fort Myers Beach, whether it be a better Times Square or Bayfront Park or enhanced safety lighting on Estero Boulevard. Any substantial improvement will cost hundreds of thousands of dollars or more, so that is what we should step up to do.”
Shamp, noting that the prospective .95 Property Tax rate will cost her roughly an additional $100 per year, stated, “I am always amazed at how much the Town accomplishes with the money paid us; I receive a lot more from the Town than most other taxing entities.”
In other matters, Council heard a brief reFRESH Estero Boulevard Projects update and Town Staff Departmental Reports.
By Gary Mooney