Credit crisis could affect Anna Maria budget
Anna Maria city commissioners learned the hard facts of being at the low end of the municipal credit market at their Sept. 23 public hearing, when they unanimously approved a $2.2 million operating budget for 2008-09 budget and a property tax drop from 2.0415 to 1.7882 mills.
While the new budget and tax rate is a decline of 12.4 percent from last year’s figure, city treasurer Diane Percycoe tempered the news of a drop in taxes when she told commissioners that the city’s $1 million line of credit might not be funded immediately because of the federal credit crisis.
The city has a line of credit in its new budget to fund stormwater-improvement projects and some money has already been drawn from the account.
Percycoe said the Florida League of Cities and the Florida Association of Counties, where the city obtained its credit line, has problems that are “causing a delay in the city receiving the funds.”
“The demand for commercial paper is small,” especially from a city that wants just $1 million, she said. The situation is “volatile,” and much depends upon the federal government acting swiftly to resolve the crisis.
She promised to provide the commission with more information at its Sept. 25 meeting. (See separate story.)
“Hopefully things will calm down soon,” she said.
“We are just one of many cities with this problem,” said Mayor Fran Barford.
Aside from discussion of the line-of-credit issue, commissioners moved swiftly to approve the $2.2 million budget that lowers the ad valorem tax rate to 1.7882 mills.
Commissioner Dale Woodland said the city staff had done a great job in preparing a budget using a new method of budgeting. “This is the best budget, something you should be proud of,” he said to the staff.
“I really like it that everyone involved knew where they were going with the budget,” Woodland added.
And it appeared that members of the public also approved the budget. No city residents attended the hearing and two commissioners — Duke Miller and Christine Tollette — were absent.
While the operating budget is $2.2 million, the total budget is $3.9 million, including the delayed $1 million line of credit. The city also has $764,000 in grant money in the budget.
The 2008-09 operating budget of $2.2 million is down 6 percent from the $2.24 million needed to run the city in fiscal year 2007-08. The contingency fund will have about $58,000, while the city’s reserve fund will maintain 38 percent of revenues, Percycoe said.
The new millage rate of 1.7882 mills represents a 12.4 percent drop from the rollback rate of 2.0415 mills. Taxing authorities are required by state law to begin their budget with a rollback of the millage rate to a rate, which will generate the same revenue as in the previous year.
A mill is $1 for every $1,000 of assessed value of property, less any exemptions. The rate can be lowered through the adoption of the budget at public hearings on the spending plan, but once the commission establishes a tentative rate, it cannot be raised by the commission.
For a house valued at $525,000 in Anna Maria, with a $25,000 homestead exemption, the property tax bill from the city would be $894.10.