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Date of Issue: March 17, 2005

Small motels may soon be extinct on Anna Maria Island
Going condo? Owners of the White Sands Resort in Holmes Beach say a conversion of the property from motel to condominium units could be the only answer to their ever-increasing property taxes. Islander Photo: Rick Catlin

Siam Garden Resort owner Kent Davis in Anna Maria went into "sticker shock" when he got his proposed 2004 tax bill a few weeks ago. The Manatee County Property Appraiser increased the value of his property by 70 percent and raised his taxes $10,000, from $13,000 to $23,000.

"It wasn't logical," said Davis. "How can I sustain my business at those taxation rates? The tax rates are headed toward a level where it will be impossible to maintain any small business on the Island."

Davis said the tax bill came on the heels of two hurricanes in August that produced his worst occupancy rate since he bought the resort three years ago.

"Ten percent of my gross income is now going to pay taxes and five percent toward insurance. And what do I get for my taxes?"

The county seems to be "either sucking us dry or forcing us out of business. The question is: 'Do I really want to continue or is it time to cash out and relax?'"

Davis would like to see some type of tax exemption given Island small business owners, similar to a homestead exemption. Otherwise, small businesses on Anna Maria Island are going to disappear in the near future.

The day will come when "it's just not worth it to continue," and rental property owners will look for a buyer who wants to turn the units into condominiums or build mega-single-family homes, he maintained.

"We just can't afford to work for the tax man," Davis said.

And he's not alone in believing the end is near for the small motels and businesses that create the Island atmosphere.

The White Sands Resort in Holmes Beach has been in Ken Gerry's family for 30 years, but if the present tax trend continues, "I know it won't be there for my children," he said.

Gerry's tax bill climbed 83 percent and increased by $18,000 for the coming year. He said he's had to fight two hurricanes, increasing insurance rates, zoning changes and density decreases and now this.

"It's scary. I'll have to increase rates by 20 percent and let one employee go. Will I have customers who will pay?" Gerry wondered. This Island may not be suited to the high-end market of visitors who routinely pay $200 a night or higher in the posh resorts on barrier islands south of Anna Maria Island, he suggested.

Small businesses on the Island simply can't sustain these 50 percent and higher tax increases. "Everybody's taxes go up, then everybody's rent goes up, then everybody's prices go up. Where does this all end?" he asked. Selling out to a condominium developer is "looking more and more enticing."

Gerry, however, said he intends to fight the millage rate with the county property appraiser and attend Holmes Beach commission budget hearings.

"It just seems to me no one wants small businesses to remain out here and that's sad. We are what makes this Island unique," he maintained.

At Haley's Motel in Holmes Beach, owner Tom Buehler said his taxes increased 67 percent this year, following a 50 percent climb the previous year.

"It makes it tough to stay in business," he said.

His wife, Sabina Musil-Buehler, said the county is asking for more in taxes than the small motel takes in during a one-month period. "It's ridiculous," she said. "How can we stay in business?"

"We planned on staying here a long time," said Tom Buehler, "but with these taxes, we now have to consider all our options and a lot of other small motels are in the same position. This could be the end of the 'mom and pop' motels on this Island," he predicted.

Buehler intends to appeal his tax bill, noting that duplex rental units were not taxed at the same high rate as the motel. "I'd like to know how they are coming up with this formula."

The property value and tax increases are hitting the big boys, too.

GSR Development LLC, developers of the Villa Rosa 17-home project in Anna Maria and the Rosa del Mar condominium project in Bradenton Beach, is paying $111,606 in taxes this year at the new appraised value of $5.8 million for its properties.

"We are doing our part to support public education," quipped Steve Noriega of GSR. While not happy with the tax increase, he noted that it means the value of Island property is going up at the same time.

Holmes Beach City Commissioner Don Maloney said while it's distressing to hear more and more of the smaller motels are considering selling out or converting to condominiums, at the same time, it means the equity in the property is increasing.

Manatee County Commissioner Jane von Hahmann, whose district includes Anna Maria Island, said there's little the commission can do about rising property taxes.

"It concerns me, but the property values are market driven," she said. The commission can only try to keep the ad valorem tax rate down as much as possible.

Island Top 10
The Top 10 taxpayers on Anna Maria Island for 2004 are:
1. GSR Development LLC - $111,606
2. Florida Power & Light - $97,714
3. Sandpiper Resort Co-op - $91,401
4. AMI Bayshore Development LLC - $84,156
5. Catalina of Anna Maria LLC - $82,689
6. Anna Maria Assoc.LP - $78,685
7. Verizon Florida Inc. - $78,193
8. Bridgewalk Partners LLC - $75,014
9. Paul S. Atkins - $72,996
10. Stephen A. Walker II - $66,097