The will receive its first formal presentation of the city's proposed $16 million Fiscal Year 2012 general fund budget during a 5:30 p.m. workshop Tuesday in City Hall, 5919 Main St.
Of course, the spending plan has been a frequent topic of informal discussion since a preliminary budget was introduced in May, so there should be few surprises – but plenty of difficult decisions to ponder – at the workshop.
Despite trimming more than $1 million in city expenditures, the proposed FY12 spending plan is $325,000 more – or 2 percent higher – than this year's $15.7 million budget.
The chief culprit is continued . According to the Pasco County Property Appraiser's Office, the city's taxable value declined by ; a $40.6 million hit that will generate $190,000 less in property tax revenue next year than this year.
More importantly, devaluation has crippled the city's community redevelopment agency, leaving it with barely enough money to pay $2.1 million in debt obligations in the coming year.
Therefore, the city's FY12 general fund will absorb $540,000 in salaries and operations expenses of 18 employees in the redevelopment office. In addition, the city must pay about $280,000 more this year than last year in pension costs for police and firefighters.
Although there's little the council can do about the $190,000 decline in property tax revenues and $719,000 increase in redevelopment and pension-related costs, it has some discretion in cutting or trimming back nearly $300,000 in assorted expenditures – including $187,000 in subsidies to 18 special events staged annually in the city.
A proposed "full-cost recovery" policy that would require organizers to compensate the city for expenses it incurs during events, such as the Chasco Fiesta, Main Street Blast, and Cotee River Bike Fest, has fostered more angst than any other budget-cutting measure thus far presented to the council – even more than raising tax rates by .3381 of a mill.
The city has created a Special Events Advisory Committee and tentatively plans to bring all organizers together in an August town hall meeting to discuss ways to lower costs and retain the events, which generate revenues for downtown restaurants and bars while providing key platforms to raise money for local nonprofit groups.
The proposed budget calls for raising the city's millage rate on real and personal property from 8.1037 to 8.4418. One mill equals $1 for every $1,000 in a property's taxable value.
The .3381 mill hike is a roll-back rate designed to generate the same amount of tax revenues this year as last year. On July 5, Interim City Finance Director Jack Douglas said the proposed mill hike could "drop further down" before the budget is formally adopted in September.
One way the city proposes to avoid raising millage beyond the roll-back rate is by withdrawing $350,000 from the general fund's undesignated reserves, a "fluctuating" reserve comparable to the city's "savings account."
This is "floating" money the city uses to operate early in the fiscal year as carry-over before property taxes are paid in November and December.