What growing pains? Oldsmar is reaping tax gains
By TAMARA EL-KHOURY
Published April 20, 2007
The 2001 decision by leaders at Nielsen Media Research to relocate more than 1,600 employees to Oldsmar from Dunedin has done more than just inspire other economic development: It also appears to have made the city of Oldsmar far richer.
Like the rest of Florida, property values have grown dramatically in this small city just west of Westchase. But tax rolls suggest Oldsmar has doubled its property tax revenue since 2001 to $5-million.
"It's the kind of company that I think every city would love to have," City Manager Bruce Haddock said. "It's high tech. Their average wages are certainly above the average wage for Pinellas County, probably the Tampa Bay area and state of Florida."
The runup in real estate values has fueled another significant trend in Oldsmar's tax base: Taxes from single-family homes are paying less and less of the city's property taxes. That underscores the outcry that is prompting state lawmakers in Tallahassee to consider changing how cities and counties collect and fund their programs.
Businesses and investment property owners have borne the brunt of higher tax collections under the recent increase in real estate values. Homesteaded homeowners have largely been shielded from such jumps due to the Save Our Homes provision in Florida's Constitution that caps annual increases in taxable values at 3 percent or less.
In Pinellas County, the average increase in property tax collections for cities is 72 percent. But Oldsmar's 103 percent increase is identical to the statewide average for all cities.
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A Times analysis suggests Oldsmar's centralized location - a quick commute to Tampa, Clearwater or St. Petersburg - has been key to its fiscal wealth.
The business community has flocked to the 9-square-mile city.
The Upper Tampa Bay Chamber of Commerce estimates more than 40,000 people work here every day, while just 14,000 live in the city founded by R.E. Olds as a community for working class people in 1916.
Nielsen's arrival appears pivotal. In 2001, Oldsmar collected about $2.5-million in property taxes. That same year, Nielsen announced plans to combine three small area offices into a 39-acre, $80-million headquarters at the Brooker Creek Corporate Center. The city had more than 200 acres of undeveloped land for office and light industrial buildings.
The first Nielsen employees moved to the Oldsmar building in 2003. Hotels followed, timing their openings with the 2005 completion of the Nielsen construction.
Virtually everything in the Brooker Creek Corporate Center was built in the past five years, said Haddock, including Nielsen. And there's just 50 acres of vacant land left for office and light industrial use.
The buildout, along with other commercial and industrial development, is responsible for two of the biggest drivers in Oldsmar's new wealth. In 2001 the city collected $461,200 from improved industrial property tax; last year it collected 114 percent more - or $988,000 - from the sector.
The city collected $373,000 from improved commercial property in 2001. By 2006, that sector's tax payments had grown to $1.1-million, a 200 percent increase.
Commercial development has also increased Oldsmar's viability as a hometown, experts say. As Tampa Bay grows, people have recognized Oldsmar as a centrally located city, said Tim Kleman, a retail specialist with CB Richard Ellis, a commercial real estate company.
And with more people living and a lot more working in Oldsmar, the demand for shopping and dining is growing. Restaurants and other retail are popping up all along Tampa Road. Just south of the entrance to the Oldsmar Flea Market is a fine chocolates shop, a nail salon, and a cigar and wine store.
"People in Tampa Bay are starting to find out that along with these new residences you're going to need the retail to support it," said Kleman, who is leasing out space at Oldsmar Galleria the new, multiuse development on State Street that is central to the city's plans to create a more vibrant downtown.
The single biggest sector on the city's tax rolls are single-family homes, which made up 48 percent of property taxes collected by the city in 2001, but just 45 percent now. With an additional 378 single-family homes since 2001, Oldsmar netted $1-million more in taxes from the sector in 2006 than it did five years ago.
Those numbers aren't shocking considering the double-digit percent hikes in property values all over Pinellas County in past years, Haddock said. It's a trend he doesn't expect to continue.
"Who knows if we'll ever see it again," he said.
But the most surprising finding in a review of Oldsmar property taxes from 2001 to 2006 shows that condominium owners are bearing a much larger share of the tax burden.
County property appraiser records show that in 2001, the city collected roughly $18,000 in taxes from 167 condos. Just five years and an additional seven units later, the city collected about $81,000, an increase of more than 350 percent.
The rising tax collections suggest many condos have only recently been purchased and homesteaded owners are not yet benefiting from the Save Our Homes cap; or the condos are second homes or investment properties and not affected by the cap.
Still, condominiums are just a small sector of what's fueling the city's wealth: They made up only 1.6 percent of property tax collected by the city last year.
[Last modified April 19, 2007, 07:36:47]
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