LEALMAN — The tax rate for fire service in this unincorporated area would go up next year under a budget tentatively approved by the Lealman Fire Commission.
But the higher charge is expected to bring in less money for an overall budget that will decrease spending by about $39,400 when compared with the current budget.
The fire board plans two hearings in September before the budget becomes final. Board members can lower the tax rate during those hearings but cannot increase it over the 3.98 mills they tentatively approved Monday. The new budget would take effect Oct. 1.
The Lealman Fire District is not the only governmental body that is taking advantage of a loophole in Amendment 1, which voters passed in an effort to decrease property taxes. Pinellas Park, Clearwater and the Juvenile Welfare Board have all proposed to increase their tax rates under a concept known as a "roll forward."
The roll rate is the tax rate, or millage, that a city or other governmental body would charge to get the same amount of dollars from property taxes that it received the preceding year.
If property values stay the same from one year to the next, and a government wants to get the same amount of money, its millage, or tax rate, would not change. But if property values go up and the government does not want to collect more money than it did the year before, it would decrease its millage, or tax rate. That's called a rollback.
On the other hand, if property values drop, the government would have to increase its millage rate to get the same dollar amount it got the year before. That's called a roll forward.
In Lealman's case, the fire district does not need as much from property taxes as it needed this year, but it does need more than it would receive if it left the tax rate at its current 3.6927 mills. So it wants to increase the rate to 3.98 mills. A mill is $1 of tax for every $1,000 of nonexempt assessed property value.
Because property values have dropped and the homestead exemption has increased, leaving the rate at 3.6927 mills would not give the fire district enough money to fund the budget. But 3.98 mills does, even though it will actually bring in about $4.97-million in property taxes, a bit less than the $5.05-million the lower rate brought in this year.
The roll forward might have been greater, but the district expects to get more income from the county for providing emergency medical services and from Kenneth City under a contract to provide fire services to that town.
In the case of the EMS money, Lealman expects to get about $1.547-million in the 2008-2009 fiscal year compared with the approximately $1.518-million the district received this year. Kenneth City will pay $200,070 in 2008-09, a bit more than the $194,240 the town paid the fire district this year.
The tentative overall 2008-09 budget — including property taxes, the EMS money, and the Kenneth City funds — is expected to be about $6.718-million. This year's overall budget is about $6.758-million.