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LAKEWOOD RANCH — As a city, Lakewood Ranch would be able to sustain itself with revenues to spare and no new taxes to Manatee County residents, according to a feasibility study released earlier this month.
The economic analysis of incorporation, produced by Fishkind & Associates, indicates if Lakewood Ranch incorporated in 2011, it would have about $1.5 million in net revenue without increasing taxes to Manatee County residents or raising taxes beyond any normal increases.
A forum about the feasibility study for incorporation will be held at 7 p.m., May 25, at The Polo Grill and Bar, 10670 Boardwalk Loop, Lakewood Ranch.
“We’d like to work with everybody and verify this is what’s best for Lakewood Ranch,” Lakewood Ranch Civic Action Forum President and Incorporation Study Committee member Keith Davey said. “We simply ask residents to keep an open mind.”
The committee is asking residents to review the 44-page study prior to the meeting, as well as other incorporation-related documents on its Web site, www.lwrdv.com/incorp.
Here are a few highlights of the study.
• Inflation is set at 3%.
• Population increases are based on proposed and approved developments by Lakewood Ranch developer Schroeder-Manatee Ranch.
“These are not numbers that exist to make something look good,” Davey said. “It’s numbers that SMR is expecting.”
Davey also noted if developments planned for Lakewood Ranch are not built or approved, the population simply would not increase. Any numbers calculated using population estimates would be affected accordingly.
REVENUES VS. EXPENSES
Members of the Lakewood Ranch Civic Action Forum Incorporation Study asked Fishkind & Associates to come up with the most conservative numbers possible by estimating high expenses and low revenues.
“We wanted to be real aggressive on expenses,” Davey said. “We don’t know what else may happen.”
For example, on the expense side of the equation, costs start out with about $203,000 budgeted for the city council. The number is ascertained by multiplying the full-time equivalent population number (16,948) by $12 per capita, a fairly standard number for cities of similar size, including the city of Bradenton and other local municipalities. Annual increases are based on population growth and 3% annual inflation.
Under the proposed city charter, council members would be paid $10,000 annually. The mayor would earn $12,000 annually. If the city does adopt a five-person council (including the mayor) as proposed, expenses for the city council would be $52,000, leaving $151,000 in excess.
Additionally, the total expenses allocated for items such as landscaping, debt service, environmental, operations, utilities and security, are based on the 2010 Lakewood Ranch community development district budgets plus 3% inflation. Annual assessments from 2012 on assume no additional inflation. Rather, they are based on population growth alone.
On the revenue side, monies raised through sources such as the local half-cent sales tax and the municipal revenue sharing program are expected to be higher than what is shown in the study because Lakewood Ranch as it exists is larger than Palmetto, the city from which data was used to estimate those revenues.
Additionally, revenue estimates for CDD assessments does not account for potential inflation.
Fishkind estimates a net surplus of 15-19% of total revenue each year, which would total about $37 million over 10 years. The money could be used to build reserves, improve services, reduce taxes or increase economic development, the report states.
Of potential revenue sources to the city, only three are contingent upon the approval of a waiver: the local half-cent sales tax, the local option fuel tax and municipal revenue sharing.
Numbers used by Fishkind to project revenues from these items are based on 2009 revenues for local cities that are slightly smaller than the existing Lakewood Ranch. Fishkind has allotted $895,000 in the first year for the local half-cent sales tax and $394,000 for the municipal revenue sharing program.
The local option fuel tax only can be used for transportation issues, so its revenue and expenses are equal and cancel each other out.
If the Legislature does not approve the waiver necessary to utilize these revenue sources, the city would not be able to count on $1.289 million, leaving it with only about $220,000 in extra revenue in the first year instead of the projected $1.51 million extra.
The study assumes Lakewood Ranch as a city would enact a property tax rate of .6109 mills, which is equal to the existing millage rate for Manatee County. The waiver requested by the city of Lakewood Ranch would be to allow the city to include its CDD assessments as part of its property taxes so that it meets a requirement to generate revenue equivalent to three mills of property taxes.
Incorporation Study Committee members are confident the Legislature would approve the waiver as it has for other communities.
HINGE ON CONSTRUCTION
Fishkind’s population projections essentially are based on the number of new homes expected to be built. So what happens to his feasibility study if new development never happens?
“The revenue assumptions are based on variations of population and inflation,” Davey said. “The same assumptions apply to the expenses. Expenses are not going to increase faster than revenue. The difference will remain the same.”
Members of the Lakewood Ranch Civic Action Forum Incorporation Study Committee have spoken with both Manatee and Sarasota counties’ sheriffs — Brad Steube and Tom Knight, respectively.
Although the Manatee County Sheriff’s Office has indicated there will be no change in cost for services, the Sarasota Sheriff’s Office maintains a policy of charging more to incorporated areas. Davey said how much more has not yet been finalized but that it should be significantly less than the $500,000 Fishkind’s study allots for it in the first year of incorporation.
The cost would be absorbed citywide.
According to Fishkind’s assessment, if Lakewood Ranch incorporated tomorrow, Manatee County residents would see no new taxes and no increased taxes beyond what they would increase in the current environment.
Sarasota residents and businesses within the city limits, however, would potentially see an increase of .6109 mills, equal to the existing Municipal Service Taxing Unit in unincorporated Manatee County. Sarasota County does not currently have an MSTU.
Incorporation Study Committee members believe the increase to Sarasota residents could be offset by a reduction in other taxes or fees.
After the May 25 public forum, the Incorporation Study Committee will disband. Its members will reunite to form the Community Coalition, a new group that will advocate for incorporation and work to raise awareness of the issue.
Davey said the group will work to finalize the proposed city charter, educate the public about incorporation and its potential impacts, develop a transition plan for whenever Lakewood Ranch does incorporate and raise funds for additional educational efforts, among other things.
Eventually, the group would conduct a straw poll of Lakewood Ranch residents to see if they favor incorporation. If the results are favorable, it would submit a special act — the combination of the feasibility study and proposed charter — to the Legislature for review. If approved by the state, the incorporation of Lakewood Ranch would then go before registered voters within the city’s proposed boundaries for a public vote.
Contact Pam Eubanks at email@example.com.
Currently 2 Responses
- Since the meeting scheduled for June 9 has been planned by the anti-incorporation folks, residents should expect to hear opinions rather than facts.
- For the other side of the story, attend the forum being conducted by the Friends of Lakewood Ranch at Town Hall at 7pm on June 9th.
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