Commissioners approve $954,397 tax increase

The Longboat Key Town Commission adopted a fiscal year 2015 budget and millage rate on first reading Monday night at Town Hall that generates $954,397 in additional dollars from a tax increase.

Town Manager Dave Bullock told commissioners that increases in the operating budget millage and beach district millage rates are needed to cover declining revenues, pay for rising pension costs and to prepare for myriad beach projects slated for 2015.

Commissioners approved an operating millage rate of 2.1763 mills, which is a .1003 millage increase over the current rate of 2.0760 mills. That millage increase includes a 0.0862 mill increase in the general fund to pay for pension costs and a 0.141 millage increase to reach a 90-day operating fund policy level.

“The town has used its fund balance every year to close the gap between revenues and expenses,” Bullock said. “We appreciate the boom years, they essentially financed the continuation of town services for the last five years, but we need a 90-day fund balance moving forward.”

There was some good news that offset declining revenues and rising expenses this year, though.
Property taxes make up 65.4% of the town’s revenue and Bullock was quick to point out the budget issues would have been a lot worse if values Key-wide hadn’t risen 5.4% overall.

Based on July 1 certified values, Bullock’s proposed combined millage rate of 2.1763 mills will generate $10,409,124 in property tax revenues, or $474,667 more than a year ago at the current millage rate. It’s the second year in a row property values have risen after years of decline.

“The town is benefitting through improved economic conditions as reflected in the 5.5% increase in assessed values of property and increased building permit activity with several substantial projects expected to begin,” wrote Bullock is his budget memo to commissioners.

Bullock worked with staff this summer to keep expenditures flat. The town also won’t hire any new employees and there won’t be any wage increases except those offered to Longboat Key Police Department officers as part of a collective bargaining contract.

The town, though, has some major looming expenditures that affect this year’s budget.

Those major projects include funding for a beach project and the construction of two groins to hold sand on the north end of the Key slated for next summer; the replacement of an aging water line in Sarasota Bay that funnels the Key’s wastewater to Manatee County for treatment; and a technology assessment to replace outdated community development and financial reporting systems (see sidebar).

Total proposed budget expenditures are $14,838,716, which is a 0.4% increase from a year ago, or $51,131.

Uncontrollable spending increases include $412,322 in pension costs, $20,562 in wage increases for union employees and a $45,655 property/workers comp insurance increase. It’s also costing the town $170,000 to undergo zoning and Comprehensive Plan changes.

Overall pension increases will rise before they go down in future years to help pay off more than $27 million in unfunded pension liabilities associated with freezing the town’s three pension plans.

The annual pension contribution increased $366,981 for a total contribution of $2,964,985 for fiscal year 2015, which represents 19.7% of the total budget.

FY 2015 BUDGET BREAKDOWN
Click here to view a glance at budget highs and lows and upcoming town project expenses.