County Administrator Ed Hunzeker says the county’s reserves will be depleted by 2018 if it keeps balancing its budget with them. He hopes a task force will face the reality.
Ed Hunzeker has been a good, thoughtful, responsible steward in his role as administrator of Manatee County. He navigated the county government through those trying recessionary years and avoided the financial catastrophes that befell so many local governments over the past eight years.
He spearheaded much-needed changes in the county’s bureaucracy, trimming its payroll by 300 and $40 million and making its building department much more market-responsive than it ever was.
A big-picture thinker, Hunzeker is always looking ahead, seeking to prepare the county fiscally for the many demands it will be facing as Manatee County continues to grow in population.
A few years ago, as a crisis loomed over the depletion of an indigent-care trust fund, Hunzeker tried to persuade his bosses and taxpayers to change the county’s taxing formula to meet what he saw as an inevitable public burden — covering the health care costs of the county’s indigents.
Voters didn’t buy into the idea. Timing, as they say, is everything. Who in his right mind wanted new tax es when he was still feeling and reeling from the recession?
Hunzeker is back at it. It’s budget season, and he is also thinking about a deadline that will come faster than expected: Hunzeker plans to retire in 2018.
Wanting to leave with his ship on course and in good condition, Hunzeker is talking now about another looming issue. Ever since the recession, Manatee has been spending more than it has been taking in. Hunzeker has balanced the annual budget by taking money from the savings he built up during the real estate boom.
But now he has not-so-good news: For one, that practice is unsustainable. Two: Unless the county changes something, Hunzeker says the county’s reserves will be gone by 2018, perhaps sooner. Those indigent health care costs are expected to consume $7 million in the next fiscal year, and the county has a growing backlog of aging infrastructure that needs updating.
There’s no way around it: Manatee County needs more money. Or, it needs to cut expenses a lot.
Oh, let’s not forget, on top of the indigent health care costs and infrastructure needs, county taxpayers also face an unfunded liability of about $115 million to cover the future health benefits the county has promised to its retired and retiring employees.
To address this challenge, Hunzeker is advocating once again the county broaden its taxation to increase its source of revenues and become less reliant on property taxes.
If you look at the table above, you can see how almost two-thirds of Manatee County’s general fund revenues come from property taxes. For Sarasota County, the percentage is nearly 50%.
One of the adverse effects of this reliance on property taxes is that when businesses and home buyers consider where to anchor, they often will see that, compared with Sarasota County, the tax rate in Manatee is 2 mills greater.
But don’t be fooled. Sarasota County nails its residents and businesses with a variety of taxes and fees that they don’t see on their property tax bills — franchise fees tacked onto utility and cable bills, infrastructure surtaxes, a half-cent sales tax, to name a few. Sarasota County also has a 1-mill tax for Sarasota Memorial Hospital, supposedly to fund indigent health care.
Hunzeker would like Manatee County to take similar steps. If you look at the table again, you can see that Sarasota County generates 22.5% of its general-fund revenues from user fees, licenses and permits; Manatee generates only 13.7% from those sources.
It’s not difficult to make the case for user fees and user taxes. They tax consumption.
That was part of Hunzeker’s argument in 2013 when he first floated the idea. On top of that, he proposed that with broadened user fees and taxes, the county could lower its property taxes. But as we noted, the timing was off. The tea party, anti-tax activists were still seething from the re-election of Barack Obama.
This time around, Hunzeker looks to be taking the right approach. Rather than he become the champion of reshaping and reforming Manatee County’s tax structure, Hunzeker told our East County Observer last week he would like to see a task force appointed to address the county’s revenue challenges.
That’s a good way to go. Public participation can be illuminating — while also provide political cover for politicians who don’t want to face the difficult choices.
Manatee commissioners should take up Hunzeker on his idea. Meantime, surely there are more expenses to be cut.
The $15-per-hour minimum wage
Progressive forces continue to rant for forcing businesses to pay a $15-per-hour minimum wage. There is no convincing them that this hurts the very people they hope to help.
But Donald J. Boudreaux, a senior fellow with the F.A. Hayek Program for Advanced Study in Philosophy, Politics, and Economics at George Mason University, recently addressed the issue on his blog, Cafe Hayek:
“So rather than play the futile game of Dueling Studies to decide whether to put at risk with minimum-wage legislation the employment prospects of hundreds of thousands, and perhaps millions, of low-skilled workers, let’s ask a simple yet probing question: Does anyone doubt that fewer people would vote if government raised the cost of voting by imposing a poll tax?
“The unambiguous answer is no. Yet the same logic that leads to this answer strongly suggests that firms will employ fewer low-skilled workers when government raises the costs of employing such workers by imposing a minimum wage.”
Here are two excerpts from Jon Meacham’s “Thomas Jefferson, The Art of Power.” Put them in the context of today. Jefferson made an accurate prediction on what happens with an uneducated electorate.
Likewise his comment to James Madison about the benefits of “a little rebellion now and then” — e.g. Trump:
Jefferson writing to a friend in 1784 from Paris:
“The basis of our governments being the opinion of the people, the very first object should be to keep that right; and were it left to me to decide whether we should have a government without newspapers, or newspapers without a government, I should not hesitate a moment to prefer the latter.
But I should mean that every man should receive those papers and be capable of reading them. … Do not be too severe upon [the people’s] errors, but reclaim them by enlightening them. If once they become inattentive to the public affairs, you and I, and Cogress, and Assemblies, judges and governor shall all become wolves.”
Jefferson to James Madison:
“I hold it that a little rebellion now and then is a good thing and as necessary in the political world as storms in the physical.”