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Indian Rocks Beach expects to keep millage rate stable, despite revenue drop

INDIAN ROCKS BEACH — Just a year ago, this sometimes-contentious beach community was nearly broke.

This year, despite a 16 percent drop in property values and corresponding tax revenues, the city is well on its way back to financial health.

"Our financial balance sheet is considerably better," City Manager Chuck Coward said Friday.

So much better, the City Commission left its tentative 2.0 millage rate untouched during a budget workshop Thursday, even though it means the city will receive $301,470 less in property tax revenues.

It also means that city property owners whose property values have dropped will see their tax bills go down next year.

The city could have raised the tax rate to 2.3786 mills to keep property tax revenues the same as this year.

"I told the commission I wanted to keep the millage rate exactly where we are, and the commission agreed," Coward said.

Actual spending on general operations is slated to drop nearly $200,000 during the coming fiscal year, according to the proposed $7.942 million 2009-10 spending plan.

Despite this drop, city service levels will remain unchanged. Employees will not receive any raises, but health benefits are expected to improve, Coward said.

He also recommended that the city reinstitute giving all staffers a $50 give certificate at Thanksgiving and hosting cookouts twice a year to recognize employee achievement.

"A 'thank you' for a job well done goes a long way," he said. "Efforts like this are even more important when we can't do some other things."

Capital projects, funded primarily by about $600,000 in Penny for Pinellas sales tax revenues, will include road resurfacing, storm water improvements, replacing several dune walkovers, engineering for a bank stabilization project in the Narrows, and improvements to Chic-A-Si Park, the Historical Museum and the city's library.

How was the city able to absorb a significant drop in property tax revenue, as well as a 10.5 percent decrease in other revenues, and yet only cut spending by about 2 percent? Coward credited the commission's actions last year.

When the city's rainy day kitty, otherwise known as the uncommitted general fund balance, dropped to $148,000 — depleted by years of bailing out the sewer and solid waste enterprise funds — the city increased utility rates and raised its property tax rate from 1.4695 to 2.0 mills.

Coward said the commission also under-budgeted revenues, which resulted in an extra $300,000 this year — almost exactly the amount property taxes are expected to decline in the coming year.

The result, Coward said, is the city will be able to operate next year with only minimal belt-tightening.

The tentative millage rate will be formally approved at the commission's meeting at 7 p.m. Tuesday at City Hall, 1507 Bay Palm Blvd. Formal public hearings on the proposed budget and millage rate will be held at 7 p.m. on Sept. 10 and 24, also at City Hall.

Indian Rocks Beach expects to keep millage rate stable, despite revenue drop 07/25/09 [Last modified: Saturday, July 25, 2009 4:31am]
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