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Guest Column

When cutting budget, slow down, do it right

By FRANK HIBBARD
Published June 12, 2007

In reflecting on the current property tax discussion in Tallahassee and the consequences the state Legislature's proposals may have locally, I'm reminded of a phrase well known in the medical world: First, do no harm. The phrase calls to mind that physicians must act with purpose, humility and the realization that good intentions may have unintended consequences.

My point? If the goal of property tax reform is to fix the inequities, then we should take the time and use the proper tools to cure the problem. The alternative is an ultimately failed short-term solution to a bigger ill.

We've been down this road before. In 1992, Florida's Office of Tax Research predicted the following consequences as a result of the Save Our Homes cap:

- The largest immediate benefit would go to homesteaded owners of high-priced, waterfront property.

- The tax burden would shift progressively to new homeowners, businesses and commercial and rental property owners.

- We would eventually see huge disparities in the taxes on similar homes in similar neighborhoods.

A quote from one of their senior-level researchers was prophetic: "People will be trapped in their homes. In another 10 years, everyone is going to want this thing gone."

The rhetoric in Tallahassee is that local government is the problem, and that spending is "out of control."

Most have read about the expenses that have hit local governments since 2001. Property and liability insurance is up 196 percent. Health insurance is up 129 percent. Required pension contributions are up 148 percent. In just the last three years, energy and fuel costs have jumped 36 percent. Construction costs have also seen triple-digit increases. The same costs that hit you at home have hit us here in local government.

Don't forget, spending at the state level has grown at about the same rate as for local governments over the last six years.

But as we talk about cuts, we also need to look at the services that have been added since 2001.

Clearwater residents now have two new fire stations, a new Main Library and improvements in North Greenwood that include a library and a recreation center. Nineteen new police officers are on the streets. Firefighters increased staffing on certain equipment and saw a reduced workweek. New parks were added, including Glen Oaks, Kapok and Bayview.

As demand for new facilities, extended hours and new technology grew, so did the operational costs. Note that these additions have been made without reducing service levels in other areas. All of this has been done while the city's millage rate has been reduced to its lowest level since 1999.

So when faced with the prospect of major cuts to our city budget, we have to start with an examination of the enhanced service levels and ask ourselves what can go. We have to look at cuts that have a lasting impact and not focus on short-term fixes. That means cutting facilities, services and consequently some of the people required to provide them. It means cutting discretionary support to outside organizations that don't provide core services to the community.

We fully support tax reform that will address the inequitable tax system in Florida. Businesses, commercial and rental property owners are bearing an undue burden. Homeowners should not feel trapped in their homes when they wish to downsize in retirement or upsize for a growing family. However, increasing exemptions, creating unlimited portability or mandating arbitrary revenue restrictions won't solve the problems and in some cases will make them worse.

I ask you to consider whether you want decisions about local quality of life made locally or mandated by state legislation. Remember that the last time we rushed for a tax solution, the result is what we live with today.

We need to slow down the train and do this right. Florida has a constitutionally mandated commission whose sole purpose is to review the state's taxation system. The Taxation and Budget Reform Commission was established specifically to consider these types of issues and provide meaningful, thoughtful feedback on solutions. We should give them the time to do their work and do it effectively.

Second, we must focus on the root causes of growing budgets at all levels of government. That means passing meaningful legislation to address insurance costs and putting a stop to state legislation that forces increased local spending. That includes transportation and pensions as well as shifting an increasing burden for funding schools and courts to the local level.

Legislators return to Tallahassee today to continue their property tax discussion. We encourage you to contact them and share your concerns about potential local impacts. You can find contact information for your state representatives at www.pinellascounty.org/delegation or you can call toll-free 1-800-342-1827. If local control is important to you, tell them so. If you'd like to see a well-considered, deliberate and effective solution, speak up.

Tell your state representatives exactly what physicians have told their students for 2, 000 years. Remind them that their mission is "to help, or at least to do no harm."

Frank Hibbard is mayor of Clearwater.

[Last modified June 11, 2007, 23:43:32]