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Politics

Tax cut's passage leaves city looking at ways to economize

Focus groups will examine what services are most important to residents.

By LORRI HELFAND and MIKE DONILA, Times Staff Writer
Published February 3, 2008

ADVERTISEMENT City Manager Norton "Mac" Craig said the city may "put a soft freeze on selected job vacancies."

Last week's passage of Amendment 1 could cost Largo about $3-million and lead city officials to slow down hiring.

Largo city staff began discussing the issue the day after the election, and City Manager Norton "Mac" Craig said the city may "put a soft freeze on selected job vacancies."

Sixty-four percent of Florida voters approved Amendment 1, giving themselves a modest tax break. Over five years, the plan is estimated to save taxpayers $9.3-billion, money that would otherwise go to local governments.

That - plus the likelihood that the real estate slowdown will depress property values and property tax revenues - has local officials looking to economize.

"We'll see if we have some projects that can be delayed or canceled," Craig said.

He said some residents might not have realized that the amendment would affect city services.

"No matter what people think there's not a lot of fluff in the city of Largo," he said.

The city had also planned to begin budget focus groups next month to see what services are most important to residents and gather ideas for streamlining services, Craig said.

"We're going to do the best we can with it and make it as painless as possible," he said.

Largo officials are not alone.

In Clearwater, leaders say they will look at shutting down libraries, canceling special events, slashing overtime pay, cutting jobs and maybe even raising the tax rate.

City Manager Bill Horne said he expects in the next few days to enact a selective hiring freeze that will likely affect most positions except rank and file police officers and firefighters.

Clearwater officials also expect taxable property values to fall 5 to 10 percent this year. Combine that with Amendment 1's impact and increased operating expenses, and Clearwater leaders say they could take a hit of $6.4- to $8.8-million in fiscal year 2008-09.

Pinellas County chief deputy property appraiser Pam DuBov said she expects a drop in residential property values but doesn't know how much. Her office will give city officials an estimate in late May.

The approval of Amendment 1 means 2008 property tax bills will include an additional $25,000 homestead exemption on local government taxes, but not school taxes.

The average homeowner will see taxes drop by about $240 this year under the increased homestead exemption. In addition, and starting this year, homeowners also can carry accrued tax benefits under Save Our Homes to a new home.

Amendment 1 also included a new $25,000 exemption on business property and a 10 percent annual cap on assessments, but it's expected to have little effect.

Staff writers Eileen Schulte, Elena Lesley and Tamara El-Khoury contributed to this report.

Projected revenue loss from Amendment 1

Largo: $3-million

Clearwater: $2.7-million

Dunedin: $800,000-$1-million

Safety Harbor: $500,000

[Last modified February 2, 2008, 21:46:44]