Tax-rate hike on Palm Beach County menu
Palm Beach Post - Link to Article
By GEORGE BENNETT
Palm Beach Post Staff Writer
Saturday, June 27, 2009
Back when real estate values were soaring, Palm Beach County commissioners routinely took credit for reducing or holding the line on property tax rates while still collecting massive revenue increases.
To preserve those bragging rights this year, however, commissioners will have to find about $70 million in budget cuts and cost savings, the county's budget office estimates.
Commissioners have scheduled another round of budget talks Monday as they try to come up with a spending plan for the year that begins Oct. 1.
Materials prepared for commissioners by the county budget office suggest a variety of budget-cutting options that don't come close to adding up to $70 million.
Eliminating Sunday service on the Palm Tran bus system would save $1.5 million, for example. Closing some pools and eliminating 23 parks maintenance jobs would save about $2.2 million. A one-day furlough of more than 2,800 county employees would save $665,000. A 1 percent pay cut for all county employees would save $1.7 million.
The current countywide property tax rate of about $3.78 for each $1,000 of appraised value pumps about $605.5 million into the county treasury. With the real estate market slumping, that same rate will generate only $534 million in the year that begins Oct. 1, budget officials estimate.
County Administrator Bob Weisman has proposed a countywide tax rate of $4.37 per $1,000 for the coming year. The rate could change slightly to reflect revised appraisal estimates released Friday.
Weisman's proposed rate would generate roughly the same amount of revenue as the county is getting this year. Under the state's truth-in-millage law, it would not be considered a tax increase, and owners of some properties would even get a tax cut.
But many property owners - particularly homesteaders who have largely been insulated from past tax-rate hikes - could see significant increases to their tax bills.
Even with house values plummeting, many of those homeowners are due to receive a 0.1 percent rise in their real estate assessments, county Property Appraiser Gary Nikolits has warned. For those homeowners, the tax on a $250,000 home with a $50,000 homestead exemption would be about $875 next year under Weisman's proposed tax rate - a 15.7 percent increase.
That figure doesn't include what property owners pay for schools, city governments, libraries, fire-rescue service and other taxing authorities.
The countywide rate pays for general county government operations and debt service and most of the sheriff's budget.
Commissioners have not approved an increase in the countywide tax rate since 1997, when they hiked it from $4.24 per $1,000 of appraised value to $4.60. Since then, commissioners have held the rate steady or lowered it each year.
Those reductions don't reflect fiscal belt-tightening by commissioners. With appraisals zooming upward and new construction booming, revenues generated from property taxes increased from $277 million in 1997-98 to a peak of $689 million in 2006-07, even as tax rates fell.