ST. PETERSBURG — Sometimes not making a decision is the biggest decision of all.
No nondecision looms larger at City Hall than this year's choice by Mayor Bill Foster and the City Council to keep the property tax rate the same. By keeping the rate the same, what city officials have in effect done is give residents a tax cut at a time when the city is starved for income.
Since 2007, the city's property tax rate has been $5.9125 per $1,000 of taxable value. It was that year that then-Mayor Rick Baker cut the rate from $6.60 for every $1,000 of taxable value, making it the lowest rate since the late 1970s. The cut came at the end of a historic rise in property values that filled city coffers.
But that seems like a lifetime ago. The economy collapsed, and property values plummeted. They have yet to recover and are collectively lower now than in 2004 — when the tax rate was 16 percent higher.
The city will collect $4.8 million less in next year's budget cycle, which begins Oct. 1.
But compare next year to 2007 and the falloff is even more striking. The city will collect $34 million less than it did that year, at the same property rate. The cumulative reduction in property taxes over the past five years is $94 million, or $376 for ever man, woman and child in the city, said Tim Finch, the city's budget director.
According to Foster's budget analysis, this is the new new.
"Our expectation is that this sharply reduced revenue level represents a new benchmark level of resources available to the city," according to analysis in the city's proposed 2012 budget.
Foster, who is a Republican, hasn't proposed a property tax rate increase in either of his two years as mayor. Of the eight-member council, only Karl Nurse, a Democrat, has talked about it. And he did so early this year before dropping it.
"I can only go so far ahead of people in hopes that they follow," Nurse said. "With a millage increase, there was no one who would back it. So, in a backwards kind of way, the decision was, no, this is okay. We'll keep it as is."
Still, to continue with the same rate is getting increasingly hard.
"This is the first year we've confronted really difficult choices, where we're now cutting into services," Nurse said. "Next year will be even worse. I wouldn't expect to see any more budgets where you don't have to bump up the millage to just get the same amount of money."
On Thursday, the City Council held its first public hearing on Foster's proposed $460.8 million budget. They spent more than 90 minutes talking about a host of concerns, from restoring a $45,000 domestic violence position in the police department to sidewalk repairs along Central Avenue to whether top administrators should get $200,000 in car allowances.
"We realize people are hurting," said Bill Dudley, a Republican. "We're increasing water rates and other fees. We don't need something else to pile on top of that. My philosophy on the millage rate is we do that as a last resort."
To avoid a property tax increase, Foster's budget is a combination of cuts in personnel and services and fee increases.
He cut 41 full-time positions and 18 part-time workers. St. Pete's full-time workforce stands at 2,692, nearly 300 fewer than 2007. Library and pool hours have been reduced. Fire code inspection fees went from $25 to $50; parking meter rates will increase from 75 cents to $1 an hour. Red light cameras are anticipated to bring in nearly $900,000.
"We still have a quality of life in the city that's high," Dudley said. "We haven't seen that bad of a decrease in city services."
The council is set to give final approval of the budget and next year's tax rate on Sept. 22 at 6 p.m. on the second floor of City Hall.
Michael Van Sickler can be reached at (727) 893-8037 or [email protected]