First Cape Coral budget hearing set for Monday
This Monday’s public hearing at 5:05 p.m. in council chambers at City Hall was originally meant for the Cape Coral City Council to approve its 2018 city budget.
But thanks to Hurricane Irma, everything got pushed back, meaning this will be the first public hearing to set the tentative property tax rate.
The second public hearing, on Monday, Oct. 2, at 5:05 p.m., will be where the city council approves the budget, one day after the fiscal year is set to begin and budget was meant to go into effect.
On Monday, council will set the tentative millage rate and adopt the tentative budget, which is currently pegged at $208 million. At the second public hearing on Oct. 2, council will finalize the millage rate and the budget.
The public can comment and ask questions during both public hearings.
City Manager John Szerlag has proposed a .25 reduction in the millage rate to 6.50, down from last year’s 6.75 rate. This would be the fourth millage rate reduction in the last five years.
The total reduction over that span is 1.4570 mils and represents an 18 percent decrease overall, from 7.9570 to 6.5 mils.
Some on council are lobbying to use the rollback rate of 6.344, which is the rate at which the city would receive about the same ad valorem revenue as the previous year.
Among those who have lobbied for the rollback are council members Rick Williams and Richard Leon and former council member Rana Erbrick, all of whom proposed using the rollback rate in previous budgets.
If the rollback rate is approved, the city would collect $1.9 million less than the proposed city millage rate, which would bring in $82.3 million.
Leon said looking at how the budget has increased in recent years, a rollback rate this year makes sense, especially after overall property valuation increase almost 10 percent.
“The millage has gone down, but we’ve collected more in taxes. We’ve raised the budget 5 percent in some years. I’m not against growth and I understand larger government, but let’s take our time and slowly administrate it,” Leon said, adding that going to the rollback rate would only “cost” the city $200,000.
The Public Service Tax rate on electric bills is proposed to remain at 7 percent, generating $7.3 million. The Fire Service Assessment has been set at 64 percent recovery of operational costs, but a reduction to 59 percent recovery was discussed. The 64 percent rate would bring in $26.1 million in revenue.
At the Aug. 22 meeting, Szerlag presented three options for council to consider. However, council could not come up with a consensus.
Leon said he would prefer the fire assessment be kept at the same level, no matter where it ends up, as long as the end result doesn’t bust the budget.
“Let’s not play games with the FSA. Let’s keep the FSA at 64 percent and use the rollback rate, not raise and lower the FSA at will. Let’s keep it in one place,” Leon said.
Councilmember Jessica Cosden is willing to go either way and will have an open mind, as long as spending does go too high.
“I’m leaning toward the FSA reduction, but I’m not totally decided because I want to hear what everyone has to say,” Cosden said.
The city would use $1.66 million from the fund balance, which would maintain 2.91 months in expenditures.
The proposed budget (along with the city’s rolling three-year budget) would include $100,000 to continue the streetlight program, $6.5 million for road resurfacing, $312,000 for median improvements, $520,000 for alley paving, and more.
The budget also includes $311,000 in support services for the Cape Coral charter schools, without chargeback, which has been a sticking point to some on the council including council members John Carioscia and Marilyn Stout.
At the Aug. 22 budget workshop, Szerlag explained that the state statute signed by Gov. Rick Scott would make the Lee County School System pay the charter schools an additional $1.8 million. But that won’t be paid until February, and is no guarantee as Lee County is suing to have the statute overturned.
Leon said it’s not a big deal, since the District will most likely pay the additional per-student dollars.
“Thankfully from the state, we were able to get the funding from the school board. A large amount of money will cover that,” Leon said. “It’s a good thing we’re getting that money and the $300,000 isn’t an issue anymore.”
Mayor Marni Sawicki has indicated she would use her line-item veto on the expenditure, and Cosden, who also serves a chairperson on the charter school board, said there may not be the votes to override.
Still, she said she’s comfortable leaving the subsidy in there, as they amend budgets all the time and since the money is almost guaranteed to come.
“We have to decide what’s right for the schools and for the entire city,” Cosden said. “It would be the first year this would happen. It makes me comfortable knowing we’re going to get that money from the school district.”
Cape Coral City Hall is at 1015 Cultural Park Blvd.