Tax revenue will keep falling in Hillsborough, though not by as much

TAMPA — Local governments in Hillsborough County are likely to face at least one more year of declining property tax receipts, based on early forecasts from the state and property appraiser.

But if there's a smiley face to be placed on the projections, it's that they call for a less precipitous fall than in recent years.

The state Office of Economic and Demographic Research released estimates this week that project a 2.1 percent decline in property values for Hillsborough County for the year just ended. The Hillsborough County Property Appraiser's Office estimates the drop at 3 to 4 percent.

Depending on which is more accurate, that would mean Hillsborough County would face anywhere from $11 million to $20 million less in property tax collections next year.

It would be the fifth consecutive year of falling property tax revenue, the biggest source of money the county uses for operating expenses, such as police and fire protection, libraries and parks.

County Administrator Mike Merrill was downcast at the news Thursday, but said he hopes to be able to craft a budget for fiscal year 2013 that responds to that possible reality. He had hoped for flat numbers at worst and the news prompted him to cancel a planned budget workshop later this month while his staff sharpens its pencils.

"We're looking at all options, because it's really fresh news," Merrill said. "We're going to try to not lay people off and not cut essential services."

Declining property values and sales tax receipts have forced the county to issue pink slips in each of the past four years as commissioners have been reluctant to raise tax rates.

Hillsborough County Deputy Property Appraiser Warren Weathers said the preliminary estimates, if they hold true, can be viewed with some optimism for local governments and property owners. That's true particularly when compared with the past four years.

Overall values fell 6.4 percent in 2008, 12.8 percent in 2009, 9.9 percent in 2010 and 4.2 percent last year.

"It's a lessening decrease," Weathers said of the latest projections.

Falling home prices still drive the overall decline, though some neighborhoods are increasing in value, said Tim Wilmath, director of valuations for the property appraiser. Multifamily housing, hotels and some industrial properties also are rebounding.

Kevin Brickey, an economist for Hillsborough County, said the area still suffers from a backlog of foreclosures and short sales that are depressing values.

"I think what is happening is that, while the troubles in the housing market keep on persisting longer than we hoped here and nationally, it's becoming less and less negative," he said.

Bill Varian can be reached at (813) 226-3387 or varian@tampabay.com.

Tax revenue will keep falling in Hillsborough, though not by as much 01/05/12 [Last modified: Friday, January 6, 2012 12:08am]

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