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Longboat Key Wednesday, May 18, 2022 1 month ago

Longboat property tax values expected to rise by double-digit percentage

Town leaders begin talk of reducing millage as budget sessions begins.
by: Eric Garwood Managing Editor

After a year of record real estate prices in 2021, an unusual budget and property tax season is likely to follow this summer, Sarasota County’s chief deputy tax appraiser said Monday.

Although estimates by the Sarasota County Property Appraiser’s office are expected to fluctuate until a final valuation is delivered on July 1, Brian Loughery, the Sarasota County chief deputy property appraiser, said his department’s early estimates for Longboat Key’s taxable  property values are up about 13% — equivalent to $600 million.

If such estimates hold, it would push property valuations of the Sarasota County side of town beyond $5 billion and the townwide valuation past $7 billion — even if Manatee County valuations remain flat, which is unlikely considering the broad increase in property sale prices in the region over the last year.

"I’m not kidding when I say every day if I run these reports, I’ll have different numbers," Loughery said. “If I run them every hour, I’ll have different numbers.”

By June 1, but probably earlier, the town is due to receive estimated valuations from Manatee and Sarasota counties, upon which town leaders can begin formulating a millage rate for the desired property tax income.

At the town’s first budget workshop of the season this week, town commissioners raised the possibility of reducing the rate on which property taxes are paid. If that happens, it would be the first change in the town’s general fund millage rate of 2.1144  since the 2017 budget. Town properties rose 5.99% in taxable value for the 2021 budget compared to the year before.

“We’ve talked internally, with the increase in the tax base that a decrease in the operating millage is likely,” Town Manager Tom Harmer said.

Commissioner Penny Gold, in a budget workshop on Monday morning, asked whether if reducing millage now, with higher prices and other inflationary pressures, was wise. Harmer said with double-digit increases in property values forecast, the town is looking at expenses it cannot control, such as fuel prices and insurance costs, and will have a better handle on them by the time the Town Commission meets on the budget again in June, adding that the town’s reserves could offset some of the expected expenses, leading still to a lower tax rate.

"We expect it will be a pretty dramatic increase in property values. … So in an attempt to not necessarily level that out, we can at least eliminate some of the impact of that, we might be able to reduce the operating millage rate somewhat," Mayor Ken Schneier said.   

The region has experienced rapid growth in real estate sales prices since the beginning of 2021, and Longboat Key came along for the ride. In March, the most recent month available, median prices for both single family homes and condos were well above the previous year in the town’s two-county ZIP code.

The median price for a single family home on Longboat was up 98% year over year to $2.64 million; the median price for condos was up 32% to $930,000, according to figures from the Realtor Association of Sarasota and Manatee.

"The market was very fruitful this year," Loughery said.

Loughery said values of homesteaded properties, which make up about a third of the town residences, will likely rise by the maximum allowed 3% and non-homesteaded properties by the maximum 10%. For sales of properties that took place in 2021, unless the owners bring homestead portability from their previous Florida property, the taxable value will likely rise to about 85%-88% of the sales price.

Loughery said this tax season is the first in the last 10 in which the taxable values for homesteaded properties have reached the 3% limit, saying they are typically risen by 1-2%.

The five parcels that make up the property on which The Residences at the St. Regis Longboat Key Resort is also rising in value as work progresses.  Loughery told commissioners the property would likely be valued for this budget cycle at around $60 million. In 2021, the just value for the 244 individual parcels were $36,285,500.

If the project is completed as expected in spring 2024, its full value would be on the tax rolls for the 2025 budget season.

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