Crescimbeni’s Shares View On Proposed Increase

Abel Harding

Folio Weekly's blog, Flog, had posted this letter Councilman John Crescimbeni sent in reply to an e-mail from a citizen.  For those who are looking for a glimpse into what some of the members of the Council are thinking as they prepare to take up the Mayor's proposed increase, Crescimbeni's letter represents an interesting point of view.  

From: Crescimbeni, John 
Sent: Thursday, July 16, 2009 4:14 PM
Subject: RE: NO MORE NEW TAXES IN DUVAL

Thank you for your email.

Although I have never campaigned on the promise of no new taxes, I did campaign on a promise to cut wasteful city spending. Unlike the mayor (who suggests belt tightening is a slogan for a bumper sticker), I think there is still waste in city government that has to be eliminated before the citizens are asked to pay higher taxes.

As you know, the mayor presented his proposed budget (for 2009-10) to the City Council on Monday. He is requesting a millage increase of 1.02 mils (about a 12% increase over last year’s rate). Now that the proposed budget has been submitted, the City Council will begin the long and arduous task of examining the same in an attempt to find additional savings or efficiencies. Generally, this review process will continue until late September at which point the City Council must finalize and approve a budget for the next fiscal year (which begins October 1).

There is no question that recent actions in Tallahassee have reduced revenues for cities and counties throughout Florida. The millage rollback mandated by the 2007 Legislature resulted in an adjustment to our local city millage rate from 9.64 mils (in the 2006-07 fiscal year) to 8.48 mils in the 2007-08 and 2008-09 fiscal years. The aggregate value of the mandated rollback reduced city revenues (from property taxes) by $67.2 million in the 2007-08 fiscal year and $68.8 million in the current (2008-09) fiscal year. As an attempt to offset some of that revenue loss, the City Council approved the following three new fees in September 2007: garbage fee, stormwater fee and the JEA franchise fee. In fiscal year 2007-08, approximately $29.8 million was collected in fees. In the current (2008-09) fiscal year, the city projects it will collect $75.8 million in fees. Unfortunately, the city incurs additional costs in collecting the stormwater and garbage fees (which are billed separately from property taxes). Those collection costs are estimated to be $740,000 for the current fiscal year.

In addition, the 2007 Legislature also created (for the first time) a $25,000 exemption for Tangible Personal Property Tax. Tangible Personal Property Tax is a tax levied against business assets such as equipment, furniture, computers, etc. A business owner with assets of $25,000 or more now saves $212.10 in city taxes. In the current fiscal year, the aggregate value of the $25,000 exemption reduced city revenues by $2.9 million.

Finally, Amendment 1, approved by Florida voters in January 2008 resulted in an additional $25,000 homestead exemption for homesteaded properties with an assessed value of $50,000 or more. Each homestead exemption is worth $212.10 in the current (2008-09) fiscal year budget. The aggregate value of the additional exemption is projected to further reduce city revenues from property taxes in the current fiscal year budget by $32.5 million.

It is also true that the city has not increased the millage rate in more than 17 years. For the 1991-92 fiscal year, the millage rate was set at 11.53 mils. As stated above, the present millage rate is $8.48. Over the years, the declining millage rate has resulted in an aggregate savings to taxpayers (and reduction in city revenues) of more than $725 million.

With that said, I still think there is opportunity for some belt tightening. Like most Americans who are now trying to get by on less, the city needs to participate in the same exercise. There is no question that the city’s three pension funds (city employees, correctional officers, and police and firefighters) are approaching unsustainable levels and need to be reformed. There is no question that salaries for every city employee need to be examined as does the need for the position itself. And there is no question (at least in my mind) that some wasteful spending in city government still exists and needs to be eliminated.

In closing, I thank you again for your email and I welcome your continued input as the City Council proceeds with the process of examining the mayor’s proposed budget. In addition, keep me posted on any more party invitations you receive!

John R. Crescimbeni
City Councilman, At-Large, Group 2

Tags: City Council, Flog, Folio Weekly, John Crescimbeni, John Peyton, Local Politics, Millage Increase, Tax Hike

This entry was posted on Saturday, July 18th, 2009 at 7:39 AM and is filed under Local Politics. You can follow any responses to this entry through the RSS 2.0 feed.