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Facing $5.65 Million Deficit, Flagler County Wrestles With What to Cut and What to Tax

| June 11, 2012

County services don’t come cheap, and some of them, like the county’s ambulance and emergency air transports, have been bringing in less actual money than budgeted figures showed. County commissioners are faced with a $5.65 million gap they must close by September. (© FlaglerLive)

County services don’t come cheap, and some of them, like the county’s ambulance and emergency air transports, have been bringing in less actual money than budgeted figures showed. County commissioners are faced with a $4.65 million gap they must close by September. Monday's conversation between commissioners got serious enough to include the possibility of grounding Flagler's Fire Flight helicopter. That idea didn't fly, however. (© FlaglerLive)

Last Updated: 2:01 p.m.

Flagler County Administrator Craig Coffey on three occasions at this morning’s meeting of the county commission assured commissioners that they’re not facing a crisis. The numbers he laid out and the many cautions he laid out say otherwise, including the need to cut more positions and reduce services.

The county is facing a $5.65 million deficit, or budget “gap,” as the administration prefers to call it, in its 2012-13 budget. (That fiscal year begins September 1.) The deficit is $2.35 million larger than Coffey had estimated two months ago, in part because of additional costs the state is passing on to the county, and in large part because of yet another drop in property values (which reduce property tax revenue) and an accounting problem auditors picked out when they saw how the county had been budgeting its ambulance services over the years: the county was mistakenly budgeting on amounts billed, not amounts collected, resulting in a $1.3 million gap. That earlier gap was also based on providing cost-of-living pay increases to government employees, which would have cost $750,000. But that proposal was eliminated before today’s discussion (otherwise the overall deficit would have topped $6 million).

“We’re not in a crisis mode. This year like any other year we’ve got to make adjustments,” Coffey said. But this time the county has few options to make up the deficit the way it has in the past–by looking for more efficient ways of operating. It’s already done that. It’s deferred buying new equipment, deferred capital projects, and cut government operations as much as it could. Now it’s a matter of whether the county wants to keep existing services, and to do so, it would have to either find new revenue. It can raise a variety of taxes or impose new ones. It can use some of its reserves. It can cut existing services. Whatever it does, it cannot bank on an improvement in coming years.

“We can ride out the storm, but it’s going to be a long storm, it’s a four-year trend,” Coffey said, cautioning commissioners against using too much of their reserves for recurring costs, and cautioning them about two proposed constitutional amendments on the November ballot (Amendment 4 and Amendment 3) that, if approved by voters, would cut future property tax revenue yet again while likely leading the state to shift more burdens to counties and cities. Coffey also explicitly recommended against nickel-and-dime belt-tightening. “I recommend you focus and say—what services don’t we want to do, because that’s what we’ve got to make, a basic service adjustment of what we provide,” Coffey said.

“I will have to reduce positions, I don’t want to go into details,” Coffey said, estimating between seven and 10 positions overall. “These are positions that will have minimal effect on the level of service. Well, I won’t say minimal effect. They will have an effect on the level of service.”

Commissioners wrestled with the kind of identity they want for the county: should it stay what it has been, or should it become a “shoestring county,” in County Commissioner Nate McLaughlin’s words.

Ahead of today’s meeting Flagler County Sheriff Don Fleming agreed to cut his budget by $1 million by essentially cutting police services significantly: he’s not filling eight vacant deputies’ positions, among other cuts. That reduced the county’s gap by $1 million. “I tell you right out the gate I’m not comfortable with the sheriff cutting his budget by as much as he did,” Commissioner Nate McLaughlin said.

Commissioners this morning also agreed to use at least $1 million from their reserves. That reduced the deficit to $3.65 million. Talk then turned to taxes and services: raising property taxes, imposing a new sales tax and cutting services.

This is where the discussion got “murky,” in McLaughlin’s words, for a couple of reasons: the county right now has a half-cent sales tax in effect. That tax expires in December. Commissioners would like it renewed. They want to bond the revenue and build a new jail (or a jail expansion). But the county and Palm Coast have not agreed on how to split the revenue. Flagler wants its share increased, diminishing Palm Coast’s significantly over the life of the tax. That’s what’s kept the proposed referendum from making it onto the Aug. 14 primary election ballot. The county’s last chance is the November ballot. Commissioners would like to see the referendum there. And commissioners agreed to that much (vaguely: they’re not going to be clear about the revenue-sharing formula until a meeting on July 2).

But even assuming the proposal makes it onto the ballot and passes, the revenue can’t be used for the county’s operations–that is, to fill in that remaining $3.65 million deficit.

Half of that money (or close to $2 million) can be generated by yet another sales tax, what’s called a “small county sales tax.” State law gives Flagler County the authority to impose an additional sales tax of up to 1 penny on the dollar. It can do so not by going to voters in a referendum, but by a super-majority vote: at least four of the five commissioners must agree to the tax.

Barbara Revels, who chairs the commission, sought agreement from the rest of the commissioners on a blend of additional or renewed taxes. “This is premature for us to say,” Commissioner Milissa Holland said, referring specifically to the renewal of the existing sales tax: she’s uncomfortable making that decision before having a clearer idea on how its revenue will be split with Palm Coast.

Prodded by Coffey, commissioners then started to talk about actual services, including, for example, grounding the county’s Fire Flight helicopter–an idea that got no support because of the number of lives the helicopter saves, and the invaluable fire-spotting and firefighting it’s been doing over the years. The commissioners were more eager to limit its flight hours, however, and fly it “on an essential need only,” in Commissioner Alan Peterson’s words.

They talked about skipping the purchase of a new, $435,000 fire truck, to replace a 17-year-old truck (an idea Commissioner Alan Peterson favored, but that Coffey did not. “It’s time,” Coffey said of the need to buy the truck this year). Not buying the truck is still a strong possibility. So are staff reductions and health care costs. Commissioners went through a list of services they were not willing to cut, including contributions to social services. But there was agreement to consider some reduction in services at the Flagler County Library, such as the reduction in hours (which would reduce two full-time positions to part-time positions). The Council on Aging too will remain, for now, a county service, though it might be revisited.

“I’m not recommending any of these,” Coffey said, emphasizing the commission’s role in setting priorities so he could draft an actual budget, due next month.

By afternoon commissioners looked ready to cobble together cuts in some services (particularly the library), yet unspecified staff cuts, capital cuts (the fire truck), and a few other one-time savings, plus the use of $1 million in reserves, reducing the deficit to about $1.8 million. That means the commission would then pass a half-cent sales tax on top of the existing sales tax supplement. Assuming voters approve the sales tax referendum in November, and the commission passes the additional sales tax, it would raise the sales tax Flagler County residents and visitors pay to 7.5 percent. That option, revels said, would keep the county from having to raise the property tax.

At precisely 2 p.m., McLaughlin, apparently inspired by Peterson’s concern over hundreds of thousands of dollars in social services numbers shifted from one column or another, remembered that it was his wedding anniversary.

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20 Responses for “Facing $5.65 Million Deficit, Flagler County Wrestles With What to Cut and What to Tax”

  1. Jim J says:

    Skip the sales tax idea.

    Look for ways to cut not

  2. Anonymous says:

    No need to replace the luxury of a fire truck, they don’t used that much, it can last much longer. NO NEW JAIL, If you pack them like sardines, that vermin will understand it’s not a place to be.

    • Palm Coaster says:

      Get rid of Troy Harper His position at emergency services is not needed

      • SSDD says:

        Not sure about getting rid of the Emergency Management Chief, but I think the Fire Service is a little “top heavy” having three Chiefs. Maybe it’s time to downsize there and save from having to cut other staff positions. As for the fire truck being a luxury, not sure about that. I’m thinking that if I call 911, I would want the truck that shows up to actually work.

  3. Outsider says:

    While I’m generally opposed to tax hikes, if and when the county pares all unnecessary expenses I would not be opposed to raising property taxes a little. I don’t think 100 bucks a year will decimate the average household, but it could put a big dent in the county deficit. If the people of this county want to keep a helicopter, they should be ready to foot the bill because it’s not a cheap proposition, nor are half million dollar fire trucks and well-maintained roads. Again, I don’t like big tax hikes, but it seems you’re going to have to stay revenue neutral if you want to maintain the current level of services. It seems the tax bills keep going down as a result of the falling property values, but people are still getting the same services. Hmmmm…….

  4. Anon says:

    No one should have their hair on end, eyes bugging out acting as if they are surprised.
    What does one expect from a county that has a flat blue line of economic growth?

    Here are some quotes and comments.
    “We’re not in a crisis mode….” Oh, you are not are you?

    “We can ride out the storm, but it’s going to be a long storm, it’s a four-year trend,” What is the alternative to riding. Does this man have a crystal ball with respect to trends?

    “I will have to reduce positions, I don’t want to go into details,” Those being cut just do not have their notice but are already identified.

    Talk then turned to taxes and services: raising property taxes, imposing a new sales tax and cutting services. That is about all they can do there are no other options. Property taxes will continue to go up and you can bet your last money Palm Coast will also raise its property taxes.

    They talked about skipping the purchase of a new, $400,000 to $500,000 fire truck (an idea Commissioner Alan Peterson favored, but that Coffey did not. “It’s time,” Coffey said. You do not make half million-dollar expenditure when facing a five million dollar shortfall.

  5. ART WOOSLEY says:

    Once again, this is not rocket science, this is all part and parcel of an international (global) financial melt down in tandem with poor management at the local level. It’s time for you our elected officials to give up on all the grandiose schemes and ideas, and to understand that nobody in the near future is going to bring any meaningful corporation here under present day conditions.

    So, now it’s time for you to make the hard decisions that you are there to make, first of all, stop wasting money on all the frills. Get rid of ALL non-essential (want to haves) things which only serve to inflate our budgets at the expense of the residents.

    For example, Economic Development, CRA and all other agencies / groups, studies etc. anything which continues to throw our tax money down the drain, this is what your constituents expect from you, not an increase in their taxes.

    Concentrate on saving only the (essential) services, it’s now time for a serious reality check, time to tighten the belt another notch, and to pay the piper for past errors in judgement. Real leadership is needed to right this ship, so please step up to the plate and show that leadership.

    Stop all that worrying about who will get what share of the renewed sales tax should it pass, you are getting way ahead of yourselves. Think about it, do you truly believe that informed residents will vote for continuing a tax, one that they have already been paying, when they realize how their money has been handled ?

  6. Geezer says:

    Crystal ball says: the neediest and most defenseless of us will be victimized by these looming cuts.
    Keep your eye on the crystal ball.

    It’s an easy prediction.

  7. Biker says:

    Coffey needs to go. What are we paying him for? His administration didnt see this coming until this late in the game? We now have a huge deficit that his administration allowed to occur. Time for new management at the top.

  8. Send Coffey back where he came from says:

    No more grants!!!!!!

    Cut or reduce the pay of over paid positions like the Petito’s, Al Hadeed, Bengi Cauley, Billy Dawson, Mike Dixon, Joe Mayer, Troy Harper, Carl Laundrie, Sally Sherman, Christy Mayer, Holly Albanese, the engineers (Faith and company) and their extended education. Why isn’t the budding department reduced to bare bones?

    The BOCC’s staff is Top heavy and eventually it will be realized and reduced. Sixty-five worker bee jobs cut but NO fat cat jobs have been cut. The commissioners know this and ignore it-they need to be held accountable. Coffey should be honest-he doesn’t want to talk about what jobs are going to be cut-only because he knows it’s not the ones that should be cut! What’s it take for these commissioners to wise up to Coffey? He couldn’t even be honest as to how bad of shape the county is in a couple of months ago.

  9. Frank says:

    Okay cut:

    The new economic development department. Get rid of rawls ($62000) and Van Eckert($120,000) plus benefits. A department budgeted at $500,000 dollars a year; that is an easy savings. Even if this new lady can walk on water, the facts are the national economy is falling apart. Companies are not moving or expanding. Not for at least three more years. So save the $1,500,000.

    And why was this month’s economic development board meeting canceled? This is a brand new board, they don’t have anything to talk about?

    Get rid of the new engineer they just hired? Why was that necessary? There isn’t any money to do projects

    Why do we have special project coordinator and a senior special coordinator? Do we really need two special project coordinator for this small county? really?

    How much are we spending on next week’s site selector conference? That should be a public record request.

    The county commission needs to be held accountable! Why are we hiring all these high wage people and three months latter we are announcing $4,000,000 deficit.

    No economic development department and no new fire truck. That is a $1,000,000 savings right there.

  10. Anonymous says:

    What is the reason a new engineer was recently hired when it was known we are in the red, and when there are job cuts on the agenda? Do our commissioners not see something wrong with this picture? They should be ashamed, and Coffey has some explaining to do.

  11. snapperhead says:

    I’m tired of this praying on the fear of cutting services. How about instead you cut some salaries at the top and if these community “leaders” making over 100k think they can do better elsewhere then let them. i’ve had my income reduced by almost 50% in the last 4 years. i’m tired of hearing public employees whine about no pay raises or having to contribute to their pensions or health care. get a grip on reality and realize a good portion of people have lost their jobs or are underemployed.i’d be f*&^%( thrilled if my pay was what it was 4 years ago. some of these people make is a joke.35-45k for tax/tag clerks?50k for equipment operators?dispatch operator 60k…really. 3 counselors at 1 elementary school 70k + wtf.

  12. Jim J says:

    Now it’s time for you to make the realy difficult decisions that the commission is there to make, first of all, stop wasting money on all the frills. Get rid of ALL non-essential (want to haves) things which only serve to inflate the budgets.

  13. John Boy says:

    Want to fix the problem once and for all;

    – Pass a local law that says no public employee can be paid more than twice the local prevailing wage.

    – Pass a law that no public pension recipient can be paid more than the average prevailing wage.

    – Pass a local law that restricts anyone ability to double dip on retirement plans

    – Pass a local law requiring public employees & retirees to pay 50% of health care premiums.

    – Eliminate COLA’s for all including employee and retirees.

    – Reduce vacation to two weeks annually and eliminating banking of sick days and vacation.

    – Eliminate any and all bonus payments any and all reasons.

  14. palmcoaster says:

    Get rid of ED and all the positions in EMS and other departments that have double or triple at the top. “too many chiefs and few indians”. Cut the over paid at the top as they have too many. No I 95 Interchange, no more matching grants for the airport, no new fire truck, No new jail the latest playground proposal of Coffey. Can’t afford it!. Partition that mostly vacant castle called Justice Center and house the non violent waiting for trial inside there. I would like to see the size of those offices inside there. Even in the Taj Mahal they have secretaries, assistants in an offices the size of 800 sq. ft half my house like my living room and dining room together…and I see them mostly empty except a desk and few file cabinets and all that space. We are all enduring the maintenance of those luxuries now. We have a librarian with over 70,000 salary on a county of barely 95,000 households to pay for it and with an average income of only 39,000 per household. Look at that sheriff department we have the boss of the boss of the boss of the boss top brass, making over 85,000 some and over 70,000 many of them. Same with the county EMS.
    Its time to cut from the top. Leave our good public employees that are the only one’s doing the services work that we pay you for. We better all show up to these county budget meetings like we did to the city council last. Otherwise Coffey and company will get their wish….more taxes on us all.

  15. Howard Duley says:

    With the ton of hotels in Palm Coast mostly empty why not bring in prostitution. It will kill two birds with one stone. It will fill the hotels and solve our tax problems. The extra revenue from the hotels plus the sex tax to say nothing of the extra meals taxes and whala were home free. This way our useless government will have megadollars extra to play with. We will have more tourists than Disney World.

  16. Hummmm! says:

    So I would say we need to look at the most obveos things the small things add up like all the deputys in there cars off duty I have seen them in street close at publix shoping to the one that bothe

    • Think first, act second says:

      Under the current Sheriff, deputies are authorized to take their vehicles home nightly. They are available if an emergency occurs and they must be called. Want to change the policy, the first way would be to change the sheriff, but you better vett the sheriff candidates about their policy on this subject. They may all be for it and you have no hope of a change, or some may be against it and you have a hope to change the policy but you would have to work to change the current sheriffs administration.

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