Holmes Beach commissioners Sept. 12 passed first readings of ordinances setting a tentative millage rate of 1.7500 and approving the 2013-14 $9 million budget.
While city officials are keeping the millage rate the same as the 2012-13 fiscal year, the city gained revenue in property taxes due to higher property valuations. According to state statutes, that’s a tax increase. Millage is merely a percentage of the total, not the value.
Mayor Carmel Monti said the city’s millage rate — $1 for every $1,000 of evaluation — is the lowest of all island cities, including Longboat Key.
“Even though we’ll see a slight increase from property valuations and because we took a dip from the recession, taxes are still down from two or three years ago,” said Monti. “We have a slight increase in physical dollars, but it’s still lower than a couple of years ago.”
During public comment, Bill Shuman said regardless of whether or not Holmes Beach can boast of the lowest millage rate, “it seems taxes are still going up. I believe the millage should be reduced, as well as the budget. I think you folks need to find ways to reduce rather than increase.”
Commissioner David Zaccagnino said Holmes Beach has been fortunate over the years.
“We’ve always had the lowest millage and I’ve been very proud of that,” said Zaccagnino. “We’ve always had fiscal responsibility. Even when other cities were increasing taxes and laying people off, our budget has always been strong.”
Zaccagnino said most people don’t understand that only 10 percent of a Holmes Beach resident’s property tax bill comes back to the city.
He claims 45 percent goes to Manatee County and 45 percent goes to schools, but he also agreed with Shuman, that the city millage rate should be lowered.
Monti said a strong focus would be placed on raising revenue for the city over the next fiscal year.
“There is always going to be increases in cost of living with employee and retirement costs,” said Monti. “The better option to keep the level of service is to look at revenue generating and that’s what we are going to do this year. We have a strong reserve, the lowest millage and are under-budgeted in every department.”
Monti said it shows that the city is on a strong track and in a good position to look at generating revenue to possibly lower taxes in the future.
Commissioner Marvin Grossman moved to pass the first reading of an ordinance setting the tentative millage rate and Commissioner Pat Morton seconded the motion. The motion passed 4-1, with Zaccagnino voting “nay.”
During discussion of passing the budget as presented, officials discussed in length about how escalating retirement costs have led other cities into financial trouble.
While retirement contributions will cost the city almost $405,000 in the upcoming fiscal year, most of which is police department related, the police pension board is considered to be in good shape with its financial investments.
Zaccagnino, who has served as liaison to the pension board since taking office eight years ago, said the board has done an outstanding job with its investments during economic turbulent times.
“But we will need to have some discussion at some point because you never know if your investments will pay off,” he said. “At some point, we need to have a deep discussion to take that liability off our balance sheet.”
Commissioner Judy Titsworth moved to pass the first reading of an ordinance that will establish the 2013-14 fiscal year budget as it was presented to the public. Grossman seconded the motion and while Zaccagnino reiterated an argument for the need to lower taxes, the motion passed 5-0.
The budget and millage rate will come back before the commission at 6:30 p.m. Tuesday, Sept. 24, for final consideration.