As property values plunged during the real estate market collapse, Manatee County's revenues sank, too, since the county is too dependent on property taxes. The tax base dropped by a third over the past few years. Home values have been inching upward but with little optimism they'll return to the boom time numbers.
Plus, Florida's Legislature forced counties and municipalities to reduce property taxes and set restrictions on increases several years ago -- a violation of the home rule principle and a law that harms some counties more than others.
Some governments, including Sarasota County, collect revenue on a variety taxes and fees, thus reducing reliance on a single source and the possibility of a budget crunch.
Manatee County officials are thus prudently reviewing options for greater diversification, too -- revenue-neutral choices.
In conjunction with the mammoth "How Will We Grow?" report released last week, county officials drew up a companion study to chart the future: "How Will We Pay? Restructuring Revenues for Manatee County Government."
While many Manatee municipalities charge a utility tax or franchise fee, residents in the unincorporated parts of the county do not pay those. The report calls for the establishment of these diverse "revenue sources for funding county government with more fairness from a broader base of payers."
Property owners will be pleased with the proposed ad valorem tax relief. County officials suggested commissioners trim property taxes by $11.1 million, or 0.6677 mills, saving the typical homeowner about $100 per year.
The county would recoup that revenue with franchise fees on utilities, collecting revenue from electricity, natural gas and water/sewer customers. The study proposes a 5 percent electric franchise fee, and that means the average residential utility customer will pay about $52 annually. Renters will not be pleased if those costs are passed down by landlords.
The electric fee alone would amount to $11.1 million in general revenue, equal to the property tax reduction.
Another source of new money is the establishment of a $2 per month stormwater utility fee -- to be offset by a $2 decrease in residential garbage rates.
The new stormwater fee targets properties with impervious surfaces that add to runoff and increase the maintenance burden on the county's stormwater system. Only owners of these properties would pay, including the school district, churches and other sites currently exempt from property taxes. An exact fee schedule would have to be composed.
The report also proposes to shift garbage charges from monthly billing to the annual property tax bill -- thus preventing snowbirds and other part-time residents living in single-family homes from halting this service and cost while living elsewhere. The county benefits more so with a reduction in both bad debt and operating costs for monthly billing.
This flunks the fairness test the county is trying to incorporate here. Overall, though, the proposal moves Manatee away from government services vulnerable to the vagaries of the real estate market, a highly desirable goal.
Plus, one of this project's goals is the promotion of economic development. The reduction in the property tax should accomplish that by leveling the competitive field with neighboring counties -- even though Manatee's total revenue burden even today is lower than Sarasota, Pinellas and Hillsborough. The appeal of a lower property tax bill will help with business recruitment and retention.
Commissioners are expected to address this proposal in April. We expect further community discussion and approval of the bulk of these ideas.