Spirited debate about tax reductions marked the Volusia County Council’s first look at the proposed 2021-22 budget, which was released July 20.
“Cut, cut cut, cut, cut — show me where to cut!” Council Member Ben Johnson challenged critics of the budget that relies on property-tax increases.
The spending plan for the next fiscal year, which begins Oct. 1, weighs in at more than $1 billion. For those demanding a more exact number, the county government wishes to spend a grand total of $1,149,250,377 during the 12-month period. The 10-figure sum breaks new ground in the history of the county, including the implementation of funding for constitutional officers, paying for an expanded commuter-rail system, and boosting the pay of county workers. With spending comes taxation.
“Today is the day for setting the maximum tax rates,” County Manager George Recktenwald told the council, as members received their copies of the budget. “What we’re looking at this year are the millages that we had last year.”
“Last year” actually means this fiscal year, 2020-21, which ends Sept. 30.
Those “maximum tax rates” represent a worst-case scenario for taxpayers, in that the levies may not exceed the levels adopted during July. These preliminary, or tentative, tax rates are the ones that will appear on the TRIM notices that will be mailed to property owners Aug. 20. TRIM is an acronym for “Truth in Millage,” meaning taxpayers will know ahead of time how much they may have to pay later this year — without any distasteful October surprises or sticker shock.
The tax rates in question are the proposed ad valorem levies on real estate. Under state law, a governing body or taxing authority must set a maximum or not-to-exceed rate by the end of July. Ad valorem is a Latin phrase meaning “according to value.”
“The rates that you set today can be lowered, but they cannot go up,” County Budget Director Aaron Van Kleeck said.
Much of the County Council’s attention was focused on the general fund, the rounded-off $352 million portion of the budget whose monies come largely from property taxes. Indeed, ad valorem taxes will account for some $224 million of the general fund.
The tax rate for the general fund is 5.45 mills. The general fund encompasses law enforcement, the jail, the court system, maintenance and operation of county buildings and facilities, elections, beach safety and maintenance, and parks and recreation.
The County Council may reduce the proposed tax rate, expressed in mills, during its deliberations on the budget between now and the adoption of a final levy in September. One mill equals a $1 levy on $1,000 of taxable value. Thus, hypothetically, a 1-mill tax on a piece of property valued at $1,000 would yield $1 of revenue for the taxing authority. If the property has a value of $50,000, the tax bill equals $50.
A status quo rate means higher tax bills
For Volusia County, the base countywide tax rate, including the millages for the general fund, public libraries (0.5170), and the voter-approved Volusia Forever land-acquisition (0.200) and Volusia ECHO (0.2000) cultural/recreational programs, is now 6.37 mills (rounded), or $6.37 per $1,000 of taxable value. Depending upon where it is located, a piece of property may be subject to other county-imposed taxes, such as those for the county Municipal Services District, the Fire District or Mosquito Control, in addition to the taxes imposed by the School Board, hospital districts, the water-management district, and cities.
By leaving the rate level, the county stands to collect approximately 9.5 percent more in taxes during the next fiscal year than it received earlier this year. This is because property values have risen because of a growing demand for homes, new and old, as well as more commercial property. Volusia County now has a record property-tax base of $42.8 billion — up from $39.8 billion last year.
Those higher property values and the prospect of a continuing robust real estate market prompted calls for a reduction in the ad valorem taxes. Namely, a rollback in the millage, if set, would yield property-tax revenues equal to what the county collected for the current year, without including new construction. Those calls came early in the meeting.
“I would really like to ask for a rollback,” Glenwood resident Karen Clark said. “Vote for a complete rollback. It would help us a lot.”
“Please do not raise our taxes,” DeBaryite Gary Crews pleaded, as he, too, asked for a complete rollback.
“A complete rollback of our millage is what we expect,” Chuck Collins, of Ormond Beach, told the council. “If we have to budget our household, that should apply to our city, our county and our states.”
A rollback in the countywide millage rate would be 5.82 mills, about 9.5 percent less than the current rate.
Words get attention
The pleas from the audience resonated in the afternoon, despite warnings from high-level county administrative staffers that rolling back the ad valorem rates may mean severe shortfalls in the fiscal year ahead. That is because of the mandated expenses for establishing some county officials as state constitutional officers — in effect giving them more control over their budgeting, personnel and purchasing, as a result of the passage of Amendment 10 of the Florida Constitution in 2018.
In addition, Volusia County must pay part of the cost of extending SunRail service to DeLand, and it must move to comply with another constitutional amendment requiring a minimum wage of $15 per hour within five years. The phased movement toward that mandate is part of the county’s new budget.
“It does contemplate for the coming year a 4-percent raise, or one dollar an hour,” Recktenwald said.
The leaders speak
County Chair Jeff Brower advocated a lower tax rate.
“I still have a dilemma with not going to rollback — full rollback,” he said, adding lower taxes would be an incentive for companies considering a move into the area. “I want to bring in new businesses, so that we don’t have to depend on the residential homeowner.”
Brower repeated his proposal for a 5-percent millage in the general fund, except for public-safety outlays.
Decrying “people who don’t really understand what we’re dealing with up here,” Johnson adamantly opposed lowering the tentative rate.
“You run into a lot of major issues up here that we’ve got to think about — SunRail, Amendment 10, raises to keep up. It’s needed. It’s necessary, if we’re going to keep employees. We have to go to $15 an hour,” he argued. “Inflation we have a choice about. Gas has gone up. Road building has gone up.”
“We may get hit by a major storm,” Johnson continued. “We haven’t been hit by a major hurricane. Donna was the last real hurricane that hit Volusia County in 1960. Since then, we’ve had partial storms.”
Council Member Heather Post, like Brower, called for the rolled-back rate.
“Every year, it’s inflation, impending storm, raises, Armageddon, … every single year,” she said. “What I’m pushing for is to work on the priorities. … I’m not willing to raise taxes on the citizens.”
Council Member Barb Girtman sided with Johnson.
“There may be some areas where we could cut back,” she said. “Maybe we’ll be in a better position next year. For this year, I think we ought to hold the line.”
“I do not understand how we can go to a partial rollback, as much as I would like to,” Vice Chair Billie Wheeler agreed.
Brower would not give up easily in his effort to reduce the tax rates and find ways to lower spending.
“For me, it’s philosophy. I want government to have less power, so people can be free,“ he said. “I don’t think we will ever get around to doing this unless we go to full rollback. There won’t be the motivation.”
Johnson’s motion to keep the tax rates level for the coming fiscal year carried with a 5-2 vote. Brower and Post dissented.
The County Council will debate spending and taxation during August and September. The council is slated to conduct its first public hearing and vote on the budget and tax rates at 6 p.m. Tuesday, Sept. 7, and the second and final public hearing and vote are set for 6 p.m. Tuesday, Sept. 21. Both meetings will take place in the County Council Chambers of the Thomas C. Kelly County Administration Center, 123 W. Indiana Ave., DeLand. The meetings are open to the public.
BY THE NUMBERS
The vast array of figures, along with the myriad complexities of the county government’s finances, can be confusing and daunting for the average citizen who struggles to keep a checking account in balance.
The numbers come in cascades of information that can be difficult to unravel and grasp. Perhaps the following may help one comprehend the process that affects their own pocketbooks.
$1.15 billion (rounded) — The amount of Volusia County’s proposed 2021-22 budget
$352 million (rounded) — The amount of the general fund of the county’s proposed new budget. The general fund is the portion of the budget that is funded in large part by property taxes.
$311.2 million (rounded) — The total amount of property taxes collected for all county government accounts, including not only the general fund, but also the public libraries, the countywide Municipal Services District, the Fire District, the Ponce DeLeon Port Authority, the East Volusia Mosquito Control District, the Silver Sands-Bethune Beach Municipal Services District, Volusia Forever and Volusia ECHO
$216.3 million (rounded) — The estimated amount of ad valorem tax revenues to be dedicated to the general fund in the 2021-22 fiscal year
6.37 mills (rounded) — The tentative base countywide tax rate, or approximately $6.37 per $1,000 of taxable value.
5.82 mills (rounded) — The rolled-back rate of the combined countywide levy, or approximately $5.82 per $1,000 of taxable value, including the general fund, the library system, Volusia Forever and Volusia ECHO
$42.8 billion — The current total taxable values, or tax roll, in Volusia County, including homes, businesses, industrial properties, and private recreational properties such as golf courses, hotels, motels, farms and undeveloped acreage. The current tax roll is the largest to date in the history of Volusia County. It is approximately 7.6 percent higher than the 2020 tax base, which amounted to $39.8 billion.