County Eyes Slightly Higher Property Tax Rate; It Would Be Offset Some By Lower School Rate

Ending weeks of wrangles over decimal points in attempts to keep the property tax rate from rising, the Flagler County Commission on Monday voted 3-2 to raise the rate slightly next year–what would amount to a tax increase of around $50 for the year on the median-value, homesteaded house in the county.

But for the typical homeowner, the tax increase will be largely neutralized by a small decrease in the school property tax rate. The Flagler County School Board in a special meeting this evening is taking the first step toward approving its new rate.

County Commissioners Dave Sullivan, Charlie Ericksen and Nate McLaughlin voted for the higher tax rate. Commissioners Greg Hansen and Don O’Brien voted against. They want to keep the tax rate the same as it is this year–$8.1167 per $1,000 in taxable value, even though that, too, would have amounted to a tax increase under Florida law, because appreciation in property values and new construction is resulting in a windfall for county coffers. But the two dissenting commissioners have been saying for weeks that just because revenue is up doesn’t mean the county should spend it. So they’ve pressed to hold the line on the tax rate.

Sullivan said he saw the new rate as a workable compromise and could not find big-ticket items in the budget that could be further cut in next year’s budget. He said his colleagues–Hansen and O’Brien–might not be pleased with him for moving for the new rate, but that he was comfortable with the approach, as it meets the county’s responsibilities.

The proposed rate is $8.2297, not including debt-servicing and voter-approved levies (for environmental protection) that bring up the total county tax rate to $8.725 per $1,000 in taxable value.

Putting it in more concrete terms, take County Administrator Craig Coffey’s house: its assessed value is at $224,838, its taxable value–when the $50,000 exemption is deducted–is $174.838, an improvement from last year’s $170,214. Coffey’s county tax bill this year was $1,465. If the commission adopts the new rate, the bill next year will be $1,525, an increase of $60. For a $150,000 house, the tax will be $872.

Commissioners still have time to bring down the rate: their decision on Monday only set the maximum rate they’re now allowed by law to approve come September 6, when they hold the first of two public hearings to adopt the actual property tax rate for next year.

They had started at a proposed tax rate somewhat higher than the one they settled for on Monday, as Coffey was looking to fund a number of services he had to cut back to comply with commissioners’ edict. One of those was a $900,000 purchase of new software for the county’s paperless accounts. That purchase will be pushed back a year–and the money will be borrowed and repaid over five years, Coffey said.

The county had also asked the constitutional officers to lower their budgets, with the largest such request going to the sheriff, who was asked to cut his budget by $400,000. Sheriff Rick Staly has done so but for about $30,000, according to Coffey. ““At some point you’ve got to let him just like we had to,” Coffey said, “sit back and try and figure out our adjustments, and we’ve cut hundreds of thousands, I think he can maybe work it too.”

The sheriff’s costs increased substantially in large part due to the state mandate requiring that armed security–in Flagler’s case, a deputy–be posted at every public school.

Though modest, the tax increase will be compounded by a similarly modest tax increase proposed in Palm Coast, which could add up. On the other hand, the school board’s tax rate will actually fall, so any blow on the bottom line will be softened.

The local school board goes through the formalities of setting a tax rate, but local school board members have little to do with it: the rate is set by legislators. The current school tax is $6.639 per $1,000 in taxable value. The new rate will decline to $6.41 per $1,000. Even though it’s a decrease, it still counts as a tax increase because the new rate would be 1.66 percent above the so-called rolled-back rate–the rate that would have to be set if the district were to take in as much revenue next year as it did this year.

Going back to Coffey’s house, he paid $1,296 in school taxes this year. Based on the new rate and his property value’s appreciation (and only $25,000 in homestead exemption), he will pay $1,281 in school taxes, a decrease of $15. Most homesteaded homeowners will see small decreases like that in their school tax.

Bottom line: overall tax bills are set to increase, but at little more than the rate of inflation.