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After pleas, Dunedin considers cut in tax rate

Commissioners tentatively reduce the property tax rate by 5 percent. It may go lower, but not without significant budget cuts.

By SHEELA RAMAN
Published September 16, 2006

DUNEDIN - After feeling the heat, Dunedin city commissioners Thursday night became the latest group of elected officials in Florida to consider lowering its property tax rate.

Resident after resident pleaded for lower property taxes, rousing a passionate debate over how to juggle higher city expenses and taxpayer needs.

The City Commission okayed a tentative 5 percent reduction in the property tax rate to 4.2 mills, though officials said they may go further.

One mill produces $1 in tax for every $1,000 of assessed, taxable property value. Since the proposed rate is still 10 percent higher than the rollback rate of 3.8 mills, many property owners, especially those who don't have homestead exemptions, would pay more next year.

Small business owners and landlords were especially upset by the proposed tax increase. They argued that businesses are hurting from higher insurance premiums in addition to higher taxes, and landlords suffer because they are not protected by the state's Save our Homes cap on the growth in their assessments.

The City Commission started its tax discussion by asking whether a 5 percent decrease was too much, but hearing the complaints turned the discussion around.

Several commissioners even advocated a 7.5 percent decrease, which would mean trimming the city's expenses.

"We've heard from the community that we are suffering, so we need to cut some expenses," Commissioner Julie Ward Bujalski said.

Mayor Bob Hackworth said he is confident the city can decrease the tax rate by 7.5 percent without cutting into public services such as leisure activities that give Dunedin its high quality of life.

Vice Mayor Dave Eggers was less optimistic.

"It's getting harder and harder to cut costs with a decreased revenue," Eggers said.

The city's proposed budget is currently $58.1-million and property taxes are expected to generate about 17 percent of the town's revenue next year.

Highlights of next year's budget include a new $10-million community center equipped with a recording studio and a fitness center, as well $11-million set aside to address local storm drainage issues, City Manager Harry Gross said.

In the end, commissioners voted to keep the proposed 5 percent decrease until the final budget hearing Thursday. This would give them time to figure out how to trim the budget without cutting into services, said Hackworth.

Making their task even harder, the city learned Thursday afternoon that its property insurance would also go up next year, costing the general fund around $200,000 extra, said Gross.

This was unexpected news, he said.

The double pressure from the state and taxpayers is taking its toll on local government, said Commissioner Deborah Kynes.

"We really feel the impact, which is both a blessing and a curse," she said.

The budget problem is "a big mix of things that are out of our control," Kynes said. "We've got to figure out how to send our message to Tallahassee."

ANGRY TAXPAYERS TALK...

"Shops cannot afford higher property taxes. Our raises go when taxes go up." - Marsha Goins, 43, co-owner of Art & Antique Gallery.

"With taxes, insurance, and gas prices going up, the prices we have to charge are becoming unaffordable for our customers." - Matt Maloy, 57, owner of Vista Galleries of Dunedin.

"Taxes are hurting affordable housing, and the way to lower taxes starts at the city." - Clark Carey, 65, landlord at 656 Broadway.

... AND COMMISSIONERS LISTEN

"We have turned the ship in this discussion. Now we're talking about how much spending we can cut instead of raising the millage rate. We need to have a reasonable budget." - Mayor Bob Hackworth

"If we kill off the businesses that exist, we're shooting ourselves in the foot." - Commissioner Julie Ward Bujalski

[Last modified September 16, 2006, 06:31:02]