GAINESVILLE – “Mayor, for the General Fund, no tax increase is recommended for the General Fund,” City Manager Bryan Lackey said as he began his FY2018 budget presentation at Thursday morning’s Gainesville City Council work session.
“What that means is we’ll be proposing a full rollback on both the General Fund and the Debt Service Fund,” Lackey continued.
That means the current (FY2017) General Fund millage rate of 1.63-mils will be rolled back to 1.55-mils, and the current (FY2017) Debt Service millage rate of 0.60-mils to 0.56-mils.
NOTE: A rollback is required under state law to compensate for increased property values (basis) in order for a governing entity to remain revenue neutral. If the millage rate remained the same as last year, new tax bills would increase, requiring advertisement of that fact and subsequent public hearings before tax bills could be sent to property owners.
“This year the property tax increase coming in to us is roughly going to be estimated at 4.8-percent, that’s because of 3.5-percent of new growth in our tax digest,” Lackey added.
Besides the General Fund and Debt Service portion of each tax bill sent later this year to every property owner in Gainesville are two other millage components: the school system millage rate and the millage rate for Parks and Recreation.
The Gainesville City School System has yet to determine its millage rate; the Parks and Recreation millage rate is unique, having been established by the voters of Gainesville in 1924.
The referendum voters approved 93 years ago said the Parks and Recreation millage rate could never drop below 0.75-mils and never exceed 1.00-mil. At present it is at the low end, 0.75-mils.
Because the rate cannot be rolled back to a lower number, it is technically a tax increase due to the rise in property values. Therefore certain state mandated processes must be followed.
“We will have to advertise that there is a legal tax increase,” Lackey explained. “We will need to advertise a 1.42-percent tax increase.”
That will also require additional time for public comment according to Lackey, “which means we will have to have three public hearings on the budget instead of two.” The tentative dates for those public hearings are: June 1, June 6, and June 20.
In another bit of good news for Gainesville residents Lackey said that because of strong revenue projections, no rate increase was needed from water and sewer customers.
“For many years in a row now, without a rate increase, that shows that growth is strong and the efficiencies they are seeing there are great. The Water Department is very healthy,” Lackey said.
City employees can expect a pay raise with the new budget, if approved by the city council.
“I think our employees have been waiting for me to say this: it does include a 3-percent cost of living adjustment. This is the first time in a several years that we are going to institute an across-the-board pay raise.”
Lackey forewarned the council that next year’s budget will probably require larger-than-normal pay raises for public safety officers.
“With the state’s recent enactment of giving their public safety officers a 20-percent pay increase, it’s having a trickledown effect…and it’s certainly starting to hit us. It’s starting to cause me concern.”
“This year is going to be spent analyzing that…to make sure we don’t get into any dire straits.”
When all the millage rate numbers mentioned above are added together the city’s millage rate will decrease from 2.98-mils last year to 2.86-mils for FY2018. (Again, the school system portion of the tax bill has yet to be established.) Those tax bills should be finalized and in the mail this summer.