Palm Coast government is proposing to keep the same property tax rate in 2020 as the rate in place now, with a projected 9 percent increase in property valuations and an expected revenue increase of “about $2 million to the general fund,” according to Helena Alves, the city’s finance director.
“That’s a good thing. No tax increase. That’s what we wanted for the people,” Council member Jack Howell said at this morning’s council meeting toward the end of Alves’s budget presentation. Howell was wrong. No one corrected him.
But it’s a common mistake, or misconception: that when the tax rate stays the same, the tax bill stays the same. It does not. During the Great Recession years, many a homeowner’s tax rates went up but the amount of money paid in taxes went down. The reverse is just as true today. Tax rates can stay flat or even decline some, yet the amounts taxpayers will pay will go up.
Under Florida law, the property tax rate Palm Coast is proposing is, in fact, a tax increase–and a substantial tax increase for non-homesteaded properties–because it would generate more revenue next year than the rate did this year: property taxpayers who’ve seen their property values rise will see their tax bill rise as well. Based on the current proposal, the tax increase would be pegged at 9 percent.
Howell won’t see such an increase because even though his $145,000 house on Felwood Lane saw a handsome 12 percent improvement in market value this year, his assessed value of $124,000 is entirely exempt from taxes thanks to the homestead, military and other exemptions. He paid zero dollars in taxes to the county, the city or the school board this year. He’ll pay zero next year.
Fellow-council member Bob Cuff’s property on Bren Mar Lane is more typical of what homesteaded property owners can expect by way of tax increases next year: Cuff’s property saw a 10 percent increase in market valuation this year, to $151,000, but because it’s homesteaded, the assessed value was limited to a 2 percent increase, to $100,000. Under Florida law, the assessed value of a homesteaded property may increase by no more than 3 percent or by the inflation rate, whichever is less. The inflation rate has been hovering around 2 percent. Knock off the $50,000 homestead exemption, and Cuff’s taxable value is reduced to $49,667.
Cuff’s Palm Coast tax bill last year was $225. If he votes to approve the same tax rate the city administration is proposing ($4.6989 per $1,000 in taxable value), his bill for this year will be $233, an $8 tax increase.
Most homeowners in Palm Coast are homesteaded. Almost none show up at their local governments’ budget hearings, even when a tax increase is in the works, for that reason: most are protected from the more dramatic effects of a tax increase.
Not so for businesses and non-homesteaded properties, such as rentals. Take the Publix at Belle Terre Parkway and Palm Coast Parkway. Its market value and assessed value are the same, because it has no exemptions. That value jumped $678,000 this year, to $5.5 million a 14 percent increase. Publix will pay every cent of that tax increase: It paid Palm Coast $22,800 in property tax last year. At the proposed rate, it will have to pay $26,000, a $3,200 tax increase.
Multiply that by the three Publix stores in town, and the company’s tax bill will increase by around $10,000. (Keep that in mind when you detect that seemingly inexplicable cent or two-cent increase in the price of parsnips: ultimately, you still end up paying every form of tax increase on the books, whether you’re homesteaded or not, making Howell’s statement about “no tax increase” inaccurate even for himself, assuming he shops in town for anything.)
Additional revenue to the city would underwrite a $2.6 million spending increase, though $1 million of that would be drawn from reserves (and a budget transfer of $1 million from reserves to the capital fund, in large part to pay for improvements at the city’s public works plant on U.S. 1). The new money would include paying for almost 10 new positions, raising the total number of city employees paid through the general fund to 233. The number does not include employees in so-called “enterprise funds,” or government funds that don’t depend on property taxes, such as the utility department and the stormwarter department.
Both the fire department and the policing contract with the Flagler County Sheriff would see 5 percent spending increases. Alves only cursorily mentioned the increases.
But the increase for the sheriff, of around $176,000, is nowhere near the original increase of six deputies Sheriff Rick Staly is seeking, at a cost of over $600,000.
“The feeling is we’re going to stick with the contract,” Palm Coast City Manager Matt Morton said today in a brief interview. He said the council still has plenty of room to discuss the issue and decide otherwise, though the two options it would then face would be either to trim the budget to accommodate the sheriff’s request, or raise the tax rate. The budget is already trimmed, Morton said.
The sheriff has also requested four additional deputies from the county commission.
“The sheriff is still in discussion over the entire issue, it’s certainly not a closed matter,” the sheriff’s Chief Mark Strobridge said today. In 2017, the sheriff asked for–and got–five new deputies to form a traffic unit in Palm Coast. The city’s policing budget increased by $550,000 at the time. “Those numbers are delivering,” Strobridge said. “I’m going to steal some of his words,” he continued, referring to Staly, “it’s really not time to take our foot off the gas.” He said the city continues to grow and crime reduction is not yet crime elimination. “We can’t lose our gains.”
Palm Coast’s General Fund Budget Proposal (2019):
Click to access palm-coast-budget-2019.pdf
The original woody says
Somebody has to pay for the mold filled buildings either county or city we all lose.
The Realist says
Why do the citizens of Palm Coast get an additional charge for the Sheriffs Office.They will tell us its because we don’t have our own police department….. Do we get charged less for the county fire taxes that we have to pay since we have our own fire department? Heck no. We fund 70 percent of the county’s fire department as well as 70 percent of the Sheriffs office budget. Then have to fork over millions more to get “the coverage we need”…How about just giving us the 70 percent of what we pay for. Also how about the citizens of Palm Coast stop having to pay for 70 percent of the money being spent to staff a fire station in VOLUSIA COUNTY!
Ray Deveney says
Because we’re getting it stuck in our but there’s way too many cop cars racing all over and we need a local police department cops are out looking for trouble they should never come out unless called
Lin says
Yes, Flaglerlive gets it
A shame our Council people and Commissioners don’t.
The big increase in values is just lines on paper to a lot of us (no extra $ in our pockets, values can drop next year)— and the increases are somewhat mitigated by exemptions if we have them.
But Palm Coast City taxes are a small portion compared to County and School taxes.
2/3% increase is still an increase. I guess it bothers me because of the irresponsible decisions in spending our money.
John R Brady says
any one who shops for orange juice should note that it used to come in a 64 ounce container, then cut to 59 oz. and now 54 oz for the same or higher price. So please let us not have a pity party for Publix ((“Keep that in mind when you detect that seemingly inexplicable cent or two-cent increase in the price of parsnips: ultimately, you still end up paying every form of tax increase on the books…”.Publix is already squeezing us.
Sorry Jack this is a tax increase.
Sorry Sheriff Staly, I think all your revenue should come from one source and that being the County. What you need to continue providing service should be calculated on the State established guidelines for police ratio of deputies to population and again out of one funding source.
I wish I could be at the Council meeting to make these points.
Is there any other friend I need to piss off.
KC says
(1) People should have to pass a test on basic tax math before being able to serve on the council.
(2) It looks like almost all of that tax increase is going to pay for new streetlights and the salary for an innovation and economic development coordinator. They are essentially saying light bulbs are more important than actual cops.
palmcoaster says
Our ad valorem taxes pay too much to the county and too little to the city of Palm Coast! This has been a rip off since we incorporated. That is the reason why county has been spending our hard earned overpaid taxes to them, like drunk sailors! County the most covers if so 20 to 30% of our services when Palm Coast has to foot the rest 80 to 70% of our services. So enough is enough….We all pay this county more than double of what we pay to our city government in our yearly home bills and that is a fallacy. Its time for county to refund Palm Coast or just be annexed like Miami Dade or Jacksonville Duvall.
John R Brady says
Sorry I forgot to mention Palm Coast does not have to spend 1.8 M to make Whiteview one lane in each direction instead of current two lanes in each direction
Alonzo Hudson says
When property values go down, do property taxes go down too?
JimBo says
Any additional services needed to be added for the city should be paid by new tax revenue generated by new building (residential/business) only. When the county appraiser tells the counsel that property values have gone up x%, their eyes get big and start spending.
This counsel is spending money like there is no tomorrow. Even controls put in place for spending limits no longer matter. Remember the battle for a new city hall and community center. Voted down but we have two new shiny buildings. We need to change the city code to put any project, other than water/sewer, over 1 million dollars to the residence each November. Any project requiring the city to borrow money needs residents approval.
I have two homes in the city. One I live in and the other I purchased for my son and his family to live in because they can’t afford the rents in the city. So the increase on non-homestead property hits me hard with these numbers. And the increase to businesses, they will make up that additional expense to them by charging us consumers more. Plus this will make anyone looking to start or move a business here look again at doing so.
Counsel needs to get control of their spending. No need for any increase. There should actually be a decrease.
Rob Jr. says
Property values increase by 9%. So taxation is increased proportionately.
Now the town councilors want to tack on an additional 9% increase.
Walter says
40 million in the general fund, plenty of it being invested, financial company taking their fees, and the homeowners getting screwed with a tax incease. Yup, makes all sense to me.
tom says
NO.We want the rollback rate. A 9% increase in our property taxes is ridiculous,
HammockGirl says
The additional property taxes being collected from hundreds of newly built homes should be a huge boost to Palm Coasts revenue????? I don’t understand the need for such an increase when the building boom in our area should be a huge increase for the tax base already???? Palm Coast doesn’t offer a 3 year tax abatement like some other towns/counties to attrack new development…..they charge residents from day one.
K. Mama says
What is the other exemptions Howell gets. I’d like to know. Maybe I am eligible for them.
Carl says
How do we get exempted from paying school taxes like Latitude Margaritaville? We’re both over the 55 mark and have no children or grandchildren in this county or school district….
Save Palm Coast says
Amen, a lot of states and counties exempt you from paying school tax after a certain age. All of Georgia is 65 or older.
Carl says
Ditto K. Mama. Retired veteran with disability, homestead, over 55. Our tax bill includes 50000 homestead and 5000 disabled vet and yet I still pay a tax bill. Jack?