Submitted by Dale Martin
Fernandina Beach City Manager
September 13, 2019
As things return to normal following the brush with Hurricane Dorian, the most immediate task for the City Commission is to complete the annual budget for the next fiscal year which begins October 1. The City Commission is required to conduct at least two public hearings related to the budget. The originally scheduled September 3 public hearing, the first of the two, has now been rescheduled to September 24.
The originally scheduled second public hearing on September 17 (next Tuesday) will be the first public hearing. Both public hearings will be conducted in the City Commission Chambers at City Hall (204 Ash Street) at 5:05 PM.
Throughout the budget process this year, it continues to be confirmed that many area residents are not familiar with how the budget is prepared, and perhaps even more fundamentally, how the Florida property tax system functions. In all honesty, the distinction between Market Values, Assessed Values, and Taxable Values; homestead versus non-homestead; “rollback rates” and millages; and County, school, and City tax levies can be confusing to even a trained financial expert.
Inaccurate assertions and claims regarding the City budget proliferate throughout local and social media. The most common “budget myth” is that City property taxes are increasing by thirty percent. Let me insert a few additional, but very meaningful, components: city tax revenuesare proposed to increase by thirty percent over the rollback rate. No property owner’s taxes will increase by thirty percent.
I have responded to a few concerns of residents that their property taxes are nonetheless increasing substantially over the last year’s. Upon closer examination in every one of those cases, yes, the property’staxes are increasing, but that increase is the result of the purchase of the property. Furthermore, without exception, the Market Value of the newly purchased property established by the County Property Appraiser is lessthan the purchase price. When a property owned for a long time (which results in a suppressed Assessed Value) is sold to a new owner, the Assessed Value is adjusted to reflect (not exactly) the newly established Market Value, which is evidenced by the fact that someone was willing to pay that fair market price.
Buying a home for $500,000 that was previously taxed at a value of $100,000 will obviously lead to an increase of property tax payments. In a former community, I participated in hearings associated with appeals filed by property owners regarding the assessed values of their homes. The chairman of the appeals board was notorious for prominently placing his checkbook in front of him. It was very common for appellants to argue that their property was overly valued. When queried as to what the value should be, the Chairman often immediately offered to purchase the property for the value desired by the property owner. Most property owners then uttered that the property was worth more than that. Case dismissed.
Having served in local government for over twenty years, I still find the unfamiliarity with local government disconcerting. Of all levels of government, it is local government that has the most significant impact upon your quality of life and, in all likelihood, the largest personal investment, your home. The tax notices sent to every City resident include tax levies for several agencies, but a key misperception is that all of the taxes are associated with the City. I encourage you to review your tax notice. In nearly every instance, if not all, for City residents, taxes levied by Nassau County and the Nassau County School District are higher than those levied by the City. While each of those agencies provides a variety of important services, personnel, and projects, can you readily identify for what over two-thirds of your tax payments are paying? Those are not City taxes.
If you want to learn more about how local government functions, the Nassau County Council on Aging has again extended the invitation to me to conduct another iteration of my Government Academy. During the weekly sessions, I will review the City Charter and how city government is organized, discuss the financial operations of the City, introduce department directors to provide insight into the responsibilities and activities of their departments, and interact with public safety personnel (the public safety components of the City account for approximately fifty percent of the City’s General Fund expenditures).
I believe the series provides information to both new residents who don’t know much about their government and to long-term residents who already know everything but want to learn more. Unlike the first two series that were conducted in the afternoon, the next series will be an evening series, conducted from 6:00 PM-8:00 PM at the Nassau County Council on Aging Life Center, beginning on October 16 and running for six consecutive Wednesday evenings. To facilitate conversation, class-size is limited. For more information, please contact the Nassau County Council on Aging.
Thank you for your continuing interest in local government.