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  1. Hernando

Hernando County commissioners lean toward a 14 percent property tax rate increase

Hernando County Government Center Times (2018)
Published Jul. 9

BROOKSVILLE — Hernando County property owners could see a 14 percent increase in their property tax rate this year to begin to resolve the county's budget deficit.

County commissioners on Tuesday were leaning toward the tax increase over other suggestions made by County Administrator Jeff Rogers for digging out of their $10 million financial hole.

By state law, Rogers must present the commission with a balanced budget proposal by July 15, so he gave commissioners three options during Tuesday's special meeting. In addition to the 1 mill increase in the general fund property tax rate, increasing it to 7.8912 mills, he also suggested a utility rate increase or cuts largely focused on the county's libraries.

Rogers also detailed cost-cutting moves he has made in recent weeks, as well as expenses he added to the budget for ongoing maintenance and other priorities.

Rogers said he needed to know on Tuesday whether commissioners were considering the so-called payments in lieu of franchise fees. The payments essentially would charge county utility customers to lease the land their water and sewer lines run through, even though the county already controls those properties.

Rogers said the payments could raise $2.4 million. The county utilities director said the increased fees would impact 64,000 water customers and land even harder on the county's 31,500 combined water and sewer customers, who pay four times more than customers who get only water.

Commissioner John Mitten said he could not approve that, and no other commissioner supported the option.

None embraced the tax increase either, but three of the four attending the meeting acknowledged that they had to do something. Commissioner Wayne Dukes was absent.

Hernando County's budget reserve is so deeply depleted, the county will have to borrow money to pay its bills into the new fiscal year that starts on Oct. 1. Rogers said the county may have to do the same again next year.

Commission Chairman Jeff Holcomb blamed the past administrator, Len Sossamon, for the financial mess. He praised Rogers for cutting costs to help to right the county's budget. Rogers hired a financial consultant, Stantec Consulting Services, who frequently reminded commissioners on Tuesday of their daunting task.

Time and again, consultant Erick van Malssen explained that the road out of the deficit required raising more revenue, cutting expenses or both. He also made it clear that the work doesn't end with this summer's budget preparation.

Commissioners must hold future budget increases, including employee pay raises, to a rate below any revenue increases that may come as property values climb.

The proposed 1 mill tax rate increase would raise $9.1 million in new revenue. For the owner of an average Hernando County home with a $125,000 value and the standard $50,000 homestead exemption, the tax bill would rise by $75 under that plan.

Rogers also recommended that in the next budget year, commissioners consider establishing a separate taxing unit for parks, recreation and libraries and capping its growth. Commissioners deferred that discussion to a later time.

Separate taxing units — especially for the Sheriff's Office — have been shot down by the commission in the past.

Rogers also said the county could save $500,000 by closing the West Side branch library in Weeki Wachee and cutting hours at the East Side and Brooksville Main libraries to three days a week. There also was discussion of keeping open several vacant positions, including for a library aid and a code enforcement officer.

The budget proposal included two major expenses that commissioners seemed interested in deferring, possibly until next year. One was the start of payments on a new government center, which will cost the county an estimated $1.8 million for the first two years and more than $2 million per year after that. The county's judges have been pushing for more courtroom and office space in the Government Center for years.

Rogers also budgeted $1.4 million for a county computer software update, but commissioners were reluctant to make that commitment, as well.

Mitten and other commissioners said they may consider a sales tax referendum on next year's ballot for the government center and a new emergency radio system needed by county emergency responders.

Commissioner Steve Champion said he could support that idea, but he refused to support any property tax or fee increase. He has maintained throughout budget discussions that the county should be able to cut its budget back to 2017 levels.

Champion also argued that raising the tax rate would move the county closer to the state's 10 mill budget cap. If property values collapse again, as they did during the recession, he said, the county would have few options for digging out of its hole.

Consultant van Malssen said that waiting to fix the budget problem would make building back the county's depleted reserve even more difficult.

Champion also repeated his call for the county to hold Sheriff Al Nienhuis to a static budget request. The sheriff's comptroller, Terri McClanahan, said Nienhuis wants a $2.7 million increase.

Commissioners said they hoped that all constitutional officers could cut their budgets before the formal budget hearings in September.

Commissioner John Allocco, who like Champion faces a reelection campaign next year, said he could not decide on a budget fix based on what was best for his reelection. Commissioners have some responsibility for creating the budget problem, he said, but all of the responsibility for fixing it.

"We have to move forward on something,'' he said.

Holcomb called Tuesday's discussion of a tax increase his "worst day'' as a commissioner.

"It sucks,'' he said. "There's no two ways about it.''

Contact Barbara Behrendt at bbehrendt@tampabay.com or (352) 848-1434.

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