A message from Citizens for a Better Nassau

Citizens for a Better Nassau
By Chairman Bill Gingrich
June 13, 2019 10:00 a.m.

Eleven years ago, noted Florida economist Hank Fishkind conducted a fiscal sustainability study of Nassau County that highlighted several significant deficiencies in the county’s budgeting and finance function. In light of last year’s massive property tax increase – increases Fishkind predicted absent responsible action by the county – and the upcoming budget workshops for the next fiscal year, it’s fair and prudent to now assess how our county commission has performed in planning for our inevitable future growth and addressing the Fishkind recommendations.

Perhaps the single-most important observation contained within Fishkind’s work was that the county’s entire budget was not sustainable due to the total lack of forecasting and budgeting for long-term capital needs. Today, our county commission continues to fail to plan for the future through the budgeting process. They put together annual spending schedules but have resisted calls for true long-term forecasting and budgeting. A budget should form the foundation for a plan for the future, in which priorities are established and plans to fund them are articulated. It’s not simply a schedule of expenditures for the current year. Is our commission truly using the budget process to plan for the county’s future? The recent “surprise” need to implement massive tax increases, in addition to substantial increases in the taxable value of property, in the county suggests they’re not.

To illustrate what I mean, consider the example of parents wanting to provide their children with the option of a college education after high school. Would it make sense to start planning for that the day they’re born or wait until they’re a senior in high school? The answer is obvious, and you get my drift. Imagine how the conversation would go if those parents were to approach their employers, hat in hand and unilaterally demand an immediate 25% increase in their pay to fund the education they failed to plan for.

How has this failure-to-plan-and-thus-planning-to-fail scenario manifested itself in Nassau County? Well, we’ve experienced a massive population increase over the last couple of decades (and this rate of growth is increasing), putting a strain on government services and infrastructure. Between 2000 and 2019, estimates of the county’s population have increased by almost 50%. While our county commission approved many thousands of new residential units, did they plan to pave or even maintain the roads necessary to support this new growth? This will be a shock to many residents that live in East Nassau, but we still have hundreds of miles of unpaved roads in this county and an increasing number of them are heavily travelled and costly to maintain. Did the commission plan to construct park and recreation facilities to support this growth? No. Did the commission regularly update impact fees to ensure that new growth pays for its impacts? The answer, again, is no.

Compounding their failure to plan and budget appropriately, our county commissioners have also been incredibly irresponsible stewards of the tax dollars they have by paying for long-lived capital assets in cash rather than bonding these capital expenditures over time at historically low interest rates. While it’s sound debt policy to not use debt financing to fund current operations, it’s the best practice in debt policy to do so for long-lived capital projects. At the height of the Great Recession, municipal bond rates were less than 3%. Even today, they’re extremely low. Wouldn’t it make more sense, in a rapidly-growing county like ours, that our future residents help pay for the capital projects they will benefit from rather than burdening current residents all at once to pay for long-lived capital assets? A couple of years ago, our commission virtually liquidated their remaining reserve funds to pay cash for the new Sheriff’s Complex and Emergency Operations Center to the tune of about $10 million. This was just before we got hit by two hurricanes and needed those reserves to cover true rainy-day expenses.

While no one can predict the future, this fact doesn’t absolve our county commission from their responsibility to plan for it. It’s their job. If they don’t want to, or aren’t up to the job, they should move aside and let others step in and clean up this mess before we get hit with yet another massive property tax increase.

Bill Gingrich is a retired GE executive and chairman of Citizens for a Better Nassau County.

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