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Hillsborough commission keeps property tax rate flat, but 2020 budget grows to $6.62 billion

While the board’s new Democratic majority fought for modest increases in taxes and fees next fiscal year, the commission voted Thursday night to forego any changes to the millage rate.
Hillsborough County will dedicate about $1 million each school year to employ crossing guards at all 43 of its public middle schools. [EVE EDELHEIT | Times (2014)]
Published Sep. 13
Updated Sep. 13

TAMPA — For more than a decade, a Republican-dominated Hillsborough County Commission refused to raise property tax rates to boost revenue. The Democratic majority now in charge says 2020 will be no different.

While the board’s Democratic members fought for modest increases in taxes and fees next fiscal year, the commission voted unanimously Thursday night to forego any changes to the millage rate it has held steady since 2008 — $5.79 in taxes for every $1,000 of assessed taxable property value.

With the real estate market rallying and property values on the rise, the board didn’t need an increase.

The same rates allowed Hillsborough County Administrator Mike Merrill to build a $6.62 billion budget proposal for FY 2020 — a $742 million increase compared to this year’s budget.

That’s because the property appraiser’s office calculates that taxable values — the total value of property minus homestead and other exemptions — are up roughly 9.6 percent across Hillsborough County this year.

Only a handful of speakers were there to watch commissioners set rates Thursday evening during the first of two public hearings on the county’s proposed budgets for FY 2020 and FY 2021. No one asked the commission to lower that rate.

“The reason for the increase reflects, in part, the normal inflationary increases in the cost of doing business,” County Budget and Management Director Kevin Brickey said. “But it also reflects the need to provide local government services to a growing population, which includes ongoing funding for transportation and increased funding for affordable housing.”

Brickey said the county expects the current rates to take in about 5.75 percent more property tax revenue next fiscal year. That’s an estimated $117.5 million more than the county’s previous peak in 2007.

In the unincorporated area, a house with the county’s average assessed value of $165,000 and a $50,000 homestead exemption would pay $1,236.25 in property taxes next fiscal year, said Assistant County Administrator Tom Fesler.

That home’s total property tax bill — including taxes levied by the Hillsborough County school district, the water management district, the Tampa Port Authority, the Children’s Board and HART - would be $2,248.87, Fesler said.

Florida’s Save Our Homes amendment protects residents who have lived in the same home for at least one fiscal year from facing hefty property tax increases by placing a 3 percent cap on annual hikes in assessed value. That tax break is cumulative until a home changes ownership. Then the home’s assessed value resets to full market value for its new owner.

In addition, the county commission has already voted to raise Hillsborough’s Tourist Development Tax — currently a 5 percent sales tax on hotel and rental stays — to 6 percent. This increase is expected to bring in an additional $6.4 million annually to spend on tourism-related projects and promotions.

The recommended budget also includes:

  • A $30 million increase in the Hillsborough County Sheriff’s Office’s budget to fund about 60 new law enforcement positions, hire more middle school crossing guards and update its vehicle fleet.
  • $14 million to hire 43 new Fire Rescue employees, build two new fire stations in the Central Brandon area and off Rhodine Road, and to rebuild a fire station in Apollo Beach.
  • $10 million for a recurring affordable housing fund, used to leverage private investment in the construction of new affordable housing.
  • A $10 million increase in funding for the constitutional offices of the clerk of the circuit court, property appraiser, supervisor of elections and tax collector.
  • A $30 million increase for Environmental Lands Acquisition and Protection Program (ELAPP) projects.
  • A $434 million increase in reserves, including $187 million raised through the new transportation sales surtax. The county’s reserves would account for about 24 percent of its total budget.

Nearly 60 cents of every dollar of property tax revenue goes to law enforcement, fire services and other public safety under the proposed budget.

The county should also maintain its AAA bond rating, Brickey said. Hillsborough is one of only three counties in Florida to have a AAA bond rating from all three rating agencies.

The total taxable value of property in Hillsborough County is $86 billion. That lags behind comparable regions, including Broward County’s $177 billion taxable value and Miami-Dade’s $272 billion, Merrill said. Yet home sales in Hillsborough increased 5.7 percent in 2018, with the average sales price increasing 3.7 percent. The unemployment rate is continuing to fall countywide and currently sits at about 3.4 percent.

But even with the positive trends, Hillsborough County is struggling to maintain the services it can afford to provide its residents in the face of explosive population growth, Merrill said.

The county is heavily dependent on property taxes to fund the services it provides to residents and businesses. More than 70 percent of its “general fund” is property tax revenue.

"There will be growing pressure on this single, predominant revenue source to meet existing deficiencies and growing needs in public safety, affordable housing, and other essential services,'' Merrill said.

The average personal income in the Tampa, St. Petersburg, Clearwater metropolitan area is about $45,000 a year – well below the U.S. average of $51,640, Brickey said.

It’s still cheaper to live in Hillsborough County than surrounding areas, he said. In 2018, the average Hillsborough County citizen spent about 5.5 percent of their annual personal income on taxes, fees, and service charges, Brickey said. That number increases to 6.1 percent when factoring in the school and transportation surtaxes approved in last November’s election.

In 2009, Hillsborough County residents spent about 7.6 percent of their income on taxes and fees, Brickey said. That’s similar to the average 7.7 percent of annual personal income that Pinellas County residents pay today.

The county commission will hold its final public hearing on the budget at 6 p.m. on September 19. Directly following that hearing, held in the second-floor meeting chambers of the County Center, the board will vote on whether to adopt the budget.

The county’s 2020 fiscal year starts Oct. 1.


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