City council caps tax rate for next year
The Sanibel City Council approved the city’s draft budget for fiscal year 2019-2020 at its recent meeting, along with a tentative operating millage rate of 1.9139 – the same as the prior year.
On July 16, the council voted 4-0 on a resolution to advise the Lee County Property Appraiser of the proposed operating millage rate, a rolled-back rate of 1.8922 and a proposed aggregate millage rate of 2.2072 for the next year, plus millage levies for the sewer-voted, land acquisition-voted and recreation center-voted debt services. Councilmember Jason Maughan had an excused absence for the meeting.
Mayor Kevin Ruane reviewed the budget process rules prior to the vote on the operating rate.
“We can’t go higher, but we can always go lower,” Mayor Kevin Ruane said of setting the not-to-exceed number.
Exclusive of the debt service levies, the proposed aggregate taxes levied are $10.10 million.
The tentative operating millage rate and tentative budget will be considered at two public hearings, scheduled for Sept. 9 at 5:01 p.m. and Sept. 23 at 5:01 p.m. in the council chambers at City Hall.
Presented by City Manager Judie Zimomra and Finance Director Steve Chaipel, the draft budget proposes a 2019-2020 budget of $70,433,258, which includes the general fund, special revenue funds, capital project funds, enterprise funds, interfund transfers, reserves and beginning fund balances.
“The draft budget is prepared with an operating millage rate of 1.9139, which is the same operating tax rate that has been assessed to taxpayers since the fiscal year 2016 budget year,” the document states.
The city’s taxable property value for next year has been preliminary assessed by the Lee County Property Appraiser at $5,279,612,650, which is 1.60 percent higher than the current year’s final post value adjustment board value of $5,196,520,865.
“Property values on Sanibel have again reached an all-time historical high,” the document states.
The draft budget outlines the city’s total operating budget as $31,427,905.
Citywide expenditures total $51,060,532, consisting of about $6.06 million on general government, $8.59 million on public safety, $6.20 million on physical environment, $3.75 million on public works, $3.73 million on transportation, $375,000 on economic environment, $2.73 million on culture and/or recreation, $4.21 million on debt service and $17.68 million on capital outlay.
For the $17.68 million capital improvement plan, the monies are allocated as: $1.4 million for the general fund, $1.6 million for special revenue funds, $13.1 million for the sewer fund and $1.6 million for the beach parking fund of which about $15.12 million is new requested funding. The new monies requested for the sewer fund are mainly for the sewer plant and renovations, while $1.3 million of the beach parking fund will be reimbursed by the Lee County Tourist Development Council.
The draft budget breaks down the 2020 total city budget as $32,441,485 in enterprise funds, $22,584,781 in the general fund, $11,182,775 in special revenue funds, $3,281,389 in capital project funds and $1,095,855 in debt service funds. Capital project expenditures are budgeted at $3.0 million, with the significant projects budgeted for the year to include: leasing on 16 new police patrol cars, City Hall air conditioning replacements, police department modernization evaluation, box culvert repairs on Periwinkle Way and Bay Drive, Beach Road water control structure rehabilitation project, Sanibel Slough dredging and drainage improvements at various locations.
In terms of the general, transportation and beach parking funds, the document also lists unfunded initiatives for 2019-2020, which includes capital activity related to the Center 4 Life, expansion of live streaming traffic cameras to additional locations and an upgrade to the Lighthouse security system.
During the council’s discussion, Ruane noted that the city continues to reduce its total debt service. However, he pointed out that the city has several projects in the pipeline. Ruane cited the Donax wastewater plant, whether to renovate the existing police department or build a new one, discussion about what to do with the Center 4 Life, and box culvert repairs.
He suggested bundling the projects and putting them into a fund, but keeping the Donax plant in a separate fund, as a way to fit them into the budget at no cost to taxpayers. Ruane voiced his support for using debt to address the capital improvement projects, rather than using the millage rate to do that.
“I’m advocating for a long proven way to deal with the projects,” he said.
Ruane noted that he is trying to find a way to budget for items with his recommendations.
“This budget’s a little tighter,” he said.
“When you budget, you try to take a conservative approach,” Ruane added. “I think we’re taking a conservative approach.”
In the draft budget’s executive summary, some of the highlighted points include:
– In the transportation fund, revenues received from gas taxes are budgeted at $1 million. The interlocal agreement with Lee County expires Aug. 31 and revenue estimates for September and fiscal year 2019-2020 are budgeted to significantly decrease. Also, based on projected traffic counts, revenue received from the county for the Sanibel Causeway is budgeted to remain flat next year. As a result, a general fund transfer of $450,000 has been budgeted, which is consistent with council’s policy.
– In the sewer fund, $1 million in grants from the state to assist in funding the Donax wastewater treatment plant is included, of which $500,000 is a carry-over from the $2.0 million the city received in fiscal year 2018-2019. The remaining $500,000 is new funding approved by the state for next year. To date, the city has been awarded $3.325 million from the state for the $20.1 million plant remodel.
– A 3.0 percent increase in sewer and reclaimed water fees is included in the sewer fund budget.
– Beach parking revenues are budgeted to remain flat next year.
– All reserves excluding the disaster reserve have been restored to fiscal year 2018-2019 levels. The city is currently in the final process of obtaining reimbursements of approximately $3.8 million for Hurricane Irma related recovery expenditures from the state and the Federal Emergency Management Agency. The city has received approximately $350,000. The reserve for disasters has been partially restored for the fiscal year 2019-2020 budget at $1.35 million. Until all reimbursements have been received, the city has secured a $5 million line of credit with a local financial institution to replace the disaster reserve should the need arise. To date, no funds have been drawn the open line of credit.
– The budget includes $75,000 in funding to bring the city’s website and internet posted data into compliance with current Americans with Disabilities Act standards. It may include the need to replace the city’s underlying website management system to be ADA compliant. The funds budgeted are for analysis and pre-work required to begin the initiative. Staff is soliciting estimates and quotes from vendors to determine the total cost for the project.
– The budget includes the $225,000 annual transfer to the recreation complex sinking fund established years ago by the council to proactively fund necessary capital repairs and replacements at the Sanibel Recreation Center facility. The sinking fund has $800,000 reserved to fund the roof replacement, which is scheduled for fiscal year 2032 and estimated to cost $1.5 million.
According to the draft budget, the budget challenges identified by Zimomra and Chaipel include environmental concerns, the reliance on ad valorem taxes and the need to diversify revenue sources, and major capital projects including the police department, Center 4 Life and Causeway bridge.
The document outlines the total reserves for 2019-2020 as $4.54 million.
In addition, the total revenue is budgeted at $34,597,182 – a combination of taxes, licenses or permits, intergovernmental, service charges, fines and forfeitures, miscellaneous and other external sources.
To view the 2019-2020 draft budget, visit this article at www.sanibel-captiva-islander.com.