May 18, 2010
Cape tries to balance budget
But revenue outlook shows bad news
By Don Ruane
Cape Coral's taxable property value could drop 10 percent and reduce the city's income by $8.1 million, if preliminary 2011 budget forecasts hold true.
"Our revenue estimates for 2010 are on target so we don't see any reason to change them," budget director Sheena Milliken said Monday during a nonvoting City Council workshop.
Most of the decline is expected to be in the commercial sector, Milliken said.
"We're going to do our absolute best to present you a balanced budget in the middle of July with the assumptions presented here," City Manager Carl Schwing said. "We already are looking at significant reductions."
Budget changes this year saved $4.9 million that can be applied to the shortfall, Milliken said. Those 2010 savings came from eliminating positions and cutting travel and training funds.
"But there is still a shortfall," Milliken said.
Property taxes account for about 68 percent of the money the city gets each year, Milliken said. Other sources are grants and fees.
Residents pay a tax rate of $7.97 per $1,000 of taxable property value, or $797 a year for a property with a taxable value of $100,000.
The present budget is $119.7 million. The 2011 budget would be about $111.6 million if values fall 10 percent.
The presentation assumes the tax rate won't change and that other sources of money will generate the same amount as this year.
But all that could change June 1, when Lee County Property Appraiser Ken Wilkinson reports the preliminary taxable values for the county and its cities. Final values come out in October, while there's still time to amend the next budget, Milliken said.
Or the City Council could give the financial staff different goals. The council has until July 27 to set is maximum tax rate for 2011.
The council, for example, has shown an interest in creating a fund to cover the long-term costs of lifetime health and life insurance benefits for retirees.
"I look forward to some more detailed conversations down the road," Councilman Derrick Donnell said. This information should be shared with the public, he said.
"We (have) a lot of work to do," said Councilman Chris Chulakes-Leetz, who called for the Financial Advisory Committee to help out. The advisory committee makes recommendations to the council.
Schwing begins meeting today with department heads to review their budget requests.
The budget must be adopted by Sept. 30 to become effective Oct. 1 each year.
Property taxes pay for the day-to-day operation of the city. They fund services such as police and fire protection, street maintenance, parks and code enforcement.
in other business where taxes go
In other business during its workshop Monday the Cape Coral City Council heard updates on:
- Contracts totalling $75,095 with Spectrum Air and ZipFoam to update the 20-year-old air conditioning systems and insulation in fire stations 5 and 6. The work is expected to cut electric costs by $6,400 a year and pay for itself in about 12 years.
- Set a public hearing date of June 14 for an ordinance that reduces the circular construction management zone around a bald eagle's nest from 1,100 feet to 660 feet and the circular area around the nest tree where the city can block construction during the nesting season from 350 feet to 330 feet.
- A $60,000 contract with Kessler International to continue an audit started in 2006 of the utilities expansion program. The council voted March 1 to bring Kessler back to review documents that were not provided at the time by MWH, the construction manager. MWH, so far, continues to refuse to provide those records. Council members asked for a revision to make the contract contingent on getting the documents.
- Added these applicants to the list of 12 candidates for the city manager position: Mark Lauzier, Coral Springs; Tom Leipold, Cape Coral; Peter Sands, Montgomery, Ala.; Deborah Edgerly, Oakland, Calif., and Nancy Carolan, Sarasota.
-Cape Coral property tax rate: $7.97 per $1,000 of taxable property value
-Total property tax rate: $21.10 per $1,000 of taxable property value
-38 percent: City share of total property tax bill
-Others collecting property taxes: Lee County, school district, South Florida Water Management District, Lee County Mosquito Control, Lee County Hyacinth Control, West Coast Inland Waterway District.
- Source: City of Cape Coral