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Tax rate cut is not a tax cut

Despite the lowest tax rate in two decades, county leaders face the prospect of having to acknowledge a proposed double-digit increase in taxes.

By DAVID DeCAMP and BRIDGET HALL GRUMET
Published July 12, 2006

DADE CITY - Just like everyone else, county government is facing rising construction costs, higher insurance rates and increasing fuel prices.

Soaring property values will help cushion the blow in the proposed $1.1-billion budget presented to the County Commission on Tuesday.

But that leaves Pasco County in the unusual position of advertising a proposed 13.44 percent increase in taxes - even as the tax rate is the lowest in 20 years and the property tax bill for most homeowners would go down.

The proposed tax rate includes a general fund rate of $6.23 per $1,000 and a fire services rate of $1.10 per $1,000.

For the owner of a home valued at $233,000, county budget officials figure the tax bill would be almost $51 less than it was this year. That assumes the owner has the standard homestead deduction and Save Our Homes, which limits the increase in assessed values on homes.

Still, the county will collect an additional $28.3-million next year, partly because of new construction, but largely because the taxable value of existing properties shot up 21 percent.

Much of that comes from the resale of older homes that enjoyed lower taxes for years under Save Our Homes, but are reassessed at market value when they are sold, budget director Mike Nurrenbrock said.

Because the county will collect that extra revenue, it must advertise a tax increase - something the county avoided the past two years with sharper tax cuts.

Chairman Steve Simon fretted the drop in the proposed tax rate did not go far enough. He suggested the commissioners trim more.

"It's going to be advertised as an increase unless there's some very significant cutting," said Simon, who is up for re-election this fall.

Meeting that standard for next year would mean slashing $25-million in spending, comparable to shutting down the parks and library system, Nurrenbrock said.

Rising and unexpected costs arrived this year. Electricity costs went up, so the county wants to increase annual streetlight fees by $10 for about 47,000 homes. That's the first hike in 24 years.

The county is planning to spend $500,000 more for electricity in its buildings, too.

"We're kind of stuck in the same boat as our citizens and constituents," County Administrator John Gallagher said.

Pasco also needs $7.6-million more than planned to pay for a jail addition in Land O'Lakes, a supervisor of elections facility and land for a new tax collector's office in central Pasco.

Spikes in the cost of construction materials are blamed, although the county also had to modify the jail design to meet state standards.

The proposal also calls for:

- Hiring 11 new bus drivers to extend weekday service and add Saturday service in east Pasco and Sunday service in west Pasco.

- Adding 16 new ambulance workers and 22 firefighters at two stations along the fast-growing State Road 54 corridor.

- Adding 43 new workers for the utility system, which faces a proposed $2-million fine for a series of violations at county sewer plants. The additional workers would help the county comply with state standards, Gallagher said.

The commission will hold its first public hearing on the proposed budget at 6:30 p.m. Sept. 11 at the historic courthouse in Dade City. The budget year starts Oct. 1.

[Last modified July 11, 2006, 23:47:36]