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Deltona: How to pay for better roads?
By Al Everson
posted Jun 12, 2014 - 11:41:58am
Deltona, city officials say, needs about $44 million in major road improvements, but lacks the cash to pay for them.
The biggest city in Volusia County is growing and looking for opportunities to add more businesses, especially along prime thoroughfares, and leaders want to find ways to fund the upgrades as soon as possible.
"It's not unique to Deltona," Vice Mayor Heidi Herzberg said, as Deltona's leaders make up their wish list and covet the dollars to make their wishes come true.
Indeed, local and state governments, and even the federal government, are seeking ways to replenish their transportation trust funds in a time of declining revenues. Most of those revenues come from gas taxes, a long-standing source of cash for building and fixing roads and related infrastructure, and often even for subsidizing mass transit. Gas-tax collections have fallen over the past several years, as the retail prices of fuel have risen sharply — resulting in lesser volumes of fuel purchased and the motorists’ increasing use of more fuel-efficient vehicles.
Volusia County and the City of Deltona also have road-impact fees, upfront charges levied on new construction, but those revenues have likewise faltered over the past seven years, parallel with the slump in new construction and the general economy.
Deltona receives about $1.5 million in gas-tax-revenue-sharing from Volusia County each year. That sum almost equals the debt service the city must pay on a transportation bond issue floated in 2006. That debt has a 20-year term, with 12 years remaining on it.
The City Commission is contemplating a refinancing of the bond issue. A refinancing proposal would reduce the bond issue’s interest rates from the current range between 4 percent and 5.125 percent to a lesser figure, while extending the term of the debt to 2044.
Deltona's transportation trust fund may thus receive $11 million for road projects. To cover the costs of unfunded road projects, Deltona’s elected officials may turn to another source of revenue: property taxes.
“There’s no property taxes involved in this fund,” said Deltona Public Works Director Gerald Chancellor, referring to the current fiscal picture and the city's transportation trust fund.
The City Commission may tap some of its reserves, or it may raise its ad valorem rate, which is already the highest of any local government in the county. Deltona’s tax rate is 7.99 mills, or $7.99 per thousand dollars of taxable property value, but leaders may ask the city’s voters to increase the millage.
Are Deltona homeowners willing to pay more in taxes for better roads and streets to get from here to there?
“Obviously, we have to explain everything,” Deltona Finance Director Bob Clinger said.
Clinger added that the City Commission may wish to consider a referendum on a bond issue for building and improving roads.
“You’d have a hard time convincing the people of Deltona,” Mayor John Masiarczyk said.
That referendum may not come this year, however, as the economic recovery remains fragile and Volusia’s voters already face a referendum on the continuation of the school district’s half-cent sales tax for capital needs for public education. The latter vote takes place Aug. 26, in conjunction with the state and local primary.
“I’m against raising the millage rate under any circumstances,” said Commissioner Webster Barnaby.
He is not the only elected official with such feelings.
“I would like to go on the record. I do not support raising the millage rate,” said Commissioner Zenaida Denizac.
Significantly, both Barnaby and Denizac are running for higher office this year: Denizac wants to be Deltona’s next mayor, and Barnaby is vying for the at-large seat on the Volusia County Council.
Deltona has approximately 460 miles of roads and streets within its corporate limits, but the city’s leaders would like to accomplish some key projects within the next 10 years:
— Widen Fort Smith Boulevard between Elkcam and Providence boulevards, $4,250,000
— Rebuild Normandy Boulevard between Quincy Avenue and Farrington Drive, $850,000
— Widen Courtland Boulevard to three lanes between Howland and India boulevards, $4,200,000
— Widen Courtland Boulevard to three lanes between India and Fort Smith boulevards, $2.55 million
— Widen Elkcam Boulevard between North Normandy and Fort Smith boulevards from two to three lanes, $6.25 million
— Widen Tivoli Drive to three lanes between Saxon and Providence boulevards, $4.2 million
— Widen North Normandy Boulevard between Firwood Drive and Graves Avenue from two lanes to four lanes, $14.5 million.
In addition, the city has approximately $7 million worth of resurfacing work that will need to be done over the next decade.
This year, Deltona will three-lane Fort Smith Boulevard between Howland Boulevard and State Road 415, at a cost of $1.7 million. In addition, the city will pay $625,000 to improve the intersection of Fort Smith and Howland boulevards, as Volusia County widens Howland Boulevard.
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