Submitted by Susan Hardee Steger
August 31, 2015 1:00 a.m.
On August 27, city and county commissioners held a joint meeting in the Nassau County James S. Page Governmental Complex to discuss plans to establish an Amelia Island Municipal Services Taxing Unit (MSTU) to fund ongoing beach renourishment and other yet to be determined beach related costs. If commissioners decide to enact the MSTU, plans must be in place before January 2016.
The City of Fernandina Beach became the lead sponsor of its beach renourishment project years ago after the County declined to take the lead. Although renourishment is an expensive project, the federal government through a past Memorandum of Understanding funds almost 80% of the cost. The remaining portion is usually paid by the State at 9%, and the City and County each has provided 5½ % of the cost. Although county officials have not backed down from funding prior renourishment projects, challenging economic times produce funding uncertainty at the county level.
Camille Tharpe, senior vice president of Government Services Group, Inc presented a presentation to the joint commissions on Muncipal Services Taxing Units (MSTU) and how to implement MSTU’s funding for island wide renourishment, restoration, erosion control, and maintenance services island-wide, excluding those south end property owners involved with SAISSA.
MSTUs are funding mechanisms to support a particular municipal type service with a levy of ad valorem taxes. The tax is based on the taxable value of property. There is no need for a voter referendum to implement the MSTU. Yearly adjustments up or down can be made to meet funding needs.
Property located in the proposed MSTU district contains 13,487 parcels in the City and portions of the unincorporated island at a value of 2 billion, 584 million dollars and is comprised of 60% single family, 16 % condos, 16% vacant land, and the remainder includes miscellaneous hotels, government buildings, multiple family and institutional properties. There are 13,487 parcels in the area. According to Fernandina Beach Deputy City Manager Marshall McCrary, the parcel count within the city is 8,390, or roughly 62 percent of the included parcels.
The millage rate to raise $300,000 in funding is .01265 per $100,000. That means property accessed at $100,000 will be assessed at $12. According to Shanea Jones, budget director, the average taxable value in the proposed MSTU area is $191,000 the cost will be $24.24 per year or less than ¼ of a mill. To raise $484,000 the millage rate will be less than ¼ mill. In order to contribute $300,000 a year for renourishment costs, the MSTU must raise an addition $27,000 to cover administrative expenses for the tax collector and property appraiser, Including factoring in early tax payment discounts.
Although 10 % of the bed tax collected through the Tourism and Development Council (TDC) is restricted for the beach, the Board of County Commissioners (BOCC) decided to leave TDC money targeted for beaches in reserves for major projects a or storm funding. The TDC collects approximately $350,000 to $400,000 for beaches each year. Part of the funds pay for both City and SAISSA annual beach monitoring required with renourishment projects at a cost of $35,000 per year. Should the MSTU not be approved, the county has budgeted $800,000 for a portion of an upcoming renourishment project.
Why are MSTUs not collected county wide? 49.27
County Attorney Mike Mullin said property values assessed must have value that is immediately impacted by the beach. The further you are from the beach an MSTU focused on the beach is hard to justify. In answer to questions raised as to why all county taxpayers do not fund renourishment efforts since they benefit from the beach, Jones said ‘this isn’t about usage it is about property. It is [based on] what does your property gain, not what a person gains. There must be a rational relation to who you are charging and what you are charging for.”
An Alternative Beach Renourishment Plan
Toward the end of the discussion, City Manager Joe Gerrity distributed information prepared by Erik Olsen, beach renourishment project consultant, for an alternative plan for the City’s beach renourishment. Federal funds are not available this year for a beach renourishment effort, but the Army Corp of Engineers recognizes the federal government’s obligations through a Memorandum of Understanding signed years ago. (Click here for more information http://fernandinaobserver.org/2013/03/25/beach-renourishment-costs-mount-up/ .)
Every year, the Corp dredges the north end channel for the Navy and places sand on the island’s north beach. Although north beach is building up nicely, the Navy has refused to pay to place sand further south. According to Gerrity, “That is where our beaches are weak.”
This year, the Corp proposed in a contract to the Navy, that the dredged material from the channel be placed between Main Beach and the Sadler Road Seaside Park with the City, County, and State paying their share. If the contract is accepted, beach renourishment costs will be reduced. “This is a bit of good news for the city and county. This is a viable way to fund absent federal dollars.” Every five years the city and county spend 1.5 million on renourishment costs.
The millage rate for the MSTU can be adjusted up or down depending upon grants and the ability to piggy backing on channel dredging. Commissioner Leeper applauded the possibility of alternative plan noting the cost savings working with the Navy.
Citizen Comments
Len Kreger, city commission candidate, described his “somewhat reluctant” support for the special tax district because he preferred funds for beach renourishment come directly from both the city and county general funds, noting the federal and state governments pay for almost 80% of the costs. Without going into detail, he sees the MSTU as an excellent opportunity to not only look at funding renourishment but for funding other beach needs. The South Amelia Island Shore Stabilization Association remains in place and I would like to ensure that the taxing rates for both are equitable.
Mike Leary, long time resident and advocate for the enviornment, asked why we feel obligated to renourish beaches when the major goals seems to be to protect private property values. With a half a million people visiting our island Leary said visitors are not paying their fair share. We are faced with a sea level rise of 1 foot or more in 50 years which makes beach renourishment “a moot point and a waste of money.”
Andrew Curtin: After hearing the MSTU presentation, Curtin said his mind is not changed. He characterized the MSTU as an additional source of taxation. Curtin encouraged commissioners to use the 10% collected by the TDC to pay for beach renourishment. He also believes commissioners should ask voters for their approval of an MSTU before implementing the tax.
Betsy Hubin supports paying tax for beach renourishment with reservations. She believes it is a “minimal cost for maximum benefit” and that beaches deserve protection. She asked why the tax was not spread to all county residents since the “treasure in the chest belongs to everyone.” Hubin suggested there be “one deducted fund for one beach and one rule for all beaches on the island.”
City/County Commissioner Comments
County Commissioner Steve Kelly asked if collected money could be used for storm water runoff at the beach. The answer was more than likely not, but Mullin will look into it. Tharpe said that was a stretch.
City Commissioner Robin Lentz asked if it is possible to use money for rebuilding dune walkovers. Mullin said that is a possibility.
Mayor Ed Boner said beach renourishment becomes a political thing. This is a fair way to pay expenses and keep the beach the way it is now. Boner said this benefits the whole island and this is a fair and equitable way to fund. It “makes beach renourishment a non political thing that benefits the whole island.”
Commissioner Pat Gass said, “We want to make sure the ordinance is ironclade so no one can take this money and do anything else with it. People don’t trust government because government has a way of working around and using that money.”
Passage of the ordinance to support MSTU requires one reading before the County and two readings before the City. When asked who will set the MSTU rate, Jones said “the BOCC will set the annual millage as part of the budget process. Realistically they will need to consult with the City . . . since the City takes the lead on the renourishment projects. Without knowing the City’s plans, the [Board of County Commissioners] won’t know what rate is needed to ensure we are properly funding anticipated financial need.”
When asked for consensus to bring the MSTU funding forward at the City and County Commission level no objections were voiced.
Editor’s Note: Other topics brought before the joint city/county meeting will be covered in a future Fernandina Observer article.
Excellent example of folks and governments at all levels working together to create something that will benefit all of us, long term.
Seems to me, The City bears the brunt, on Beach Clean up, Construction of Walk-Overs and their Maintenance. This is as it should be, We live here. But our Guests, of which here are hundreds of thousand each year, must contribute to theses costs. I would think we would have a bed tax for that purpose. We do, right? and does it amount to anything? Our County Neighbors To the West should contribute something to the Clean up and Nourishment of these Beaches as well. Last time I looked, these guys were on the Beach. Doesn’t have to be much, but something through Taxes. Now everybody doesn’t utilize our Island Beaches, but it’s like School Taxes, I haven’t used any in 25 years, but I still pay Taxes for them, and I’m OK with that. The are for everybody Just like our Beaches.
Steve, yes there is a bed tax that goes to the TDC and as the article noted, by law they are not permitted to spend more than 10% of the collected tax on beach related operating costs. They already fund the annual monitoring of the beach erosion as well as the cost clean-up crew that patrols the beach each day for debris, empting waste containers, etc. I like the idea of some of that money being used to construct new and maintain the existing beach walkovers and, if permissible, extend the coverage hours of the lifeguards. As noted, city residents are picking up the lion’s share of the beach operation burden and that I why I favored the original arrangement of the City and County splitting the cost 50/50 instead of the MSTU which gives off-island county residents a free ride.