BROOKSVILLE — Facing an ever-deepening budget shortfall and uncertainty over where to make additional spending cuts, a divided Hernando County Commission voted Tuesday to increase the tentative property tax rate by 3.5 percent.
The move was a compromise when it became clear that two commissioners favored a higher tentative tax rate, two did not and one was stuck in the middle but leaning against the idea.
As he told his fellow commissioners, Dave Russell said he needed to be able to look taxpayers in the eye and tell them the county did every single thing possible to cut spending before moving to raise the tax rate.
Even with Tuesday's vote, the commission could still be millions away from a balanced budget.
The budget shortfall had risen again to about $4.5 million by the time the commission gathered to discuss setting the tentative rate for purposes of advertising.
The current tax rate to support the general fund is 5.4394 mills; with the increase, it would rise to 5.6279. A mill is $1 of tax for every $1,000 of appraised taxable property value. That means last year's tax bill to support the general fund was $543.94 for the owner of a $150,000 home with a standard $50,000 homestead exemption.
Commissioners agreed to advertise a .1885-mill increase in the general fund rate, which would amount to a tax increase of $18.85 for that same home. The increase equals the decrease in the rate that county property owners will see this year from the Southwest Florida Water Management District. Swiftmud's budget was capped this year by the state.
Gov. Rick Scott had touted the lower water management rate as a tax break for property owners, but the commission's move Tuesday would wipe that out.
Even if commissioners stay with the higher rate when the rate is finalized in September, most property owners would see a decline in their tax bill for county services this year because of falling property values, the property appraiser has said.
Commissioners John Druzbick and Jeff Stabins made a plea to advertise an even higher tax rate and then use the next two months to try to work with Sheriff Al Nienhuis and Supervisor of Elections Annie Williams to make more cuts in their budgets and to continue to trim expenses in the departments under the control of the commission. The final tax rate isn't set until after a second public hearing in September.
Stabins appealed directly to Russell as the swing vote on the issue.
"Guys, we cannot possibly advertise the proposed (unchanged) millage rate, or we're going to have one hell of a crisis here,'' Stabins said. "I'm begging you, Dave. You've got to do the right thing here.''
Russell said he thought there was still a way to balance the budget using creative solutions without raising the tax rate.
Several residents spoke in favor of holding the line while others said they favored the higher rate in order to provide the funds the county needs to operate and the time to continue to negotiate cuts.
Nienhuis told commissioners that he has been able to find another $250,000 in savings. He eliminated two public service aides, who are civilians who take basic calls for service, downgraded the public information officer from a sergeant to a corporal, renegotiated dental benefits for employees and returned money from workers' compensation and insurance.
Stabins questioned whether Nienhuis would join in support for an increase in the tax rate, but the sheriff declined to comment.
Williams also presented her budget, noting that the increase she requested covers two elections next fiscal year. She did say she would support the increase in the tax rate.
After the comments, Russell proposed the slight rate increase, saying it would be a wash because the rate would only go up by the same amount the Swiftmud levy will go down. He also said the county would need to use its $1.7 million budget stabilization fund to supplement the extra $1,365,804 the additional millage would bring in.
The stabilization fund has been criticized by Druzbick as being a use of one-time money to balance the budget. Plus, the money will have to be repaid within two years. The board will decide later whether to use that reserve, which requires a super-majority vote.
"This buys us another year,'' Russell told his colleagues.
It will allow the county to continue to streamline and downsize. Then, Russell said, he can in good conscience tell constituents that the county has done everything it can to become efficient, even if the tax rate has to be raised next year.
Commission Chairman Jim Adkins, who along with Commissioner Wayne Dukes voted against raising the rate, asked if the slight increase would stop the county from continuing to look for cuts. But County Administrator David Hamilton said balancing the budget will still require finding more than another million dollars in reductions before September.
"We still have our work cut out for us,'' Hamilton said.
Property owners also pay additional levies to support other aspects of county government, including the transportation trust fund and the Health Department, and those tentative rates were all approved for advertising at the same level as the current year.
Commissioners also voted to levy no tax for environmentally sensitive lands, but instead set a tax rate of .0844 mills — the same amount set for sensitive lands for the past several years — for mosquito control.
There are also separate tax levies set by other entities — including the Hernando County school district, the city of Brooksville and Swiftmud — that figure into a property owner's total tax bill.
Barbara Behrendt can be reached at email@example.com or (352) 848-1434.