HomeMy WebLinkAbout2008 09 08 Document Referenced By Manager McLemoreDate: September 8, 2008
The attached document was referenced during
the beginning of the September 8, 2008 City
Commission Regular Meeting by Manager
McLemore.
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ANSWERS TC? QUESTtQNS Y4U HA1t~ i3~EN ASKING
Why have my taxes gone up as shown on my recent tax notice forTax Year 2008?
There are three reasons for the increase as follows:
1. School taxes mandated by the Legislature increased by 8.5%.
2. In Tax Year 2007, only 50% of the cost of fire services in Winter Springs was paid by property taxes with the
remaining 50°/D being paid from fire assessments and City reserves. In Tax Year 2008, 100% of the cost of fire
services in Winter Springs will be paid by property taxes, due to the elimination of fire assessments and reserves.
Furthermore, the elimination of fire assessments and reserves in Winter Springs in favor of restoring property taxes
to pay for fire services in Tax Year 2008 will cause the cost of fire services to be shifted disproportionately upward
for higher valued real estate. This will result in persons owning higher valued properties paying disproportionately
higher property taxes in Tax Year 2008.
3. The property tax notice for Winter Springs includes millage needed to recover $1.1 million lost to Amendment "1"
and the economic downturn. Had Amendment "1" been defeated and economic conditions remained at normal
levels, the City millage would have been 1 full mill less than that shown on the tax notice.
It is important to remember that the amount of property taxes shown on your 2008 tax notice represents the worst
case scenario and the final millage levied for tax year 2008 could be less than that shown on your 2008 tax notice.
Where do my property taxes, as reflected on my
2008 tax notice, go?
As shown, schools consume the largest part of your property
tax bill followed by Seminole County and its Fire MSTU, Winter
Springs, and St. John's River Water Management District.
Why am I paying more property taxes for Fire
Services for the upcoming 2008 Tax Year than I am
paying in the current 2007 Tax Year?
Tax Year 2008 Proposed Property Tax Usage ^
4°% - _ _i
zo%
io%
°% - `~
Schools County/ City SIRWMD
Fire MSTU
Although fire consolidation has reduced the cost of fire services to residents of the City, six factors will cause property
x owners to pay more in property taxes in Tax Year 2008 for fire services as follows:
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~"` 1. As shown below, in Tax Year 2007 property taxes were utilized to pay only approximately 50% of the cost of the
fire department. The remaining 50% was paid by fire assessments and City reserves.
Fire Department Funding
Tax Year 2007 Tax Year 2008
Property Taxes 50% 100%
Fire Assessments 25% 0%
City Reserves 25% 0%
Total 100% 100%
2. In the upcoming 2008 tax year, 100% of the cost of the fire department will be paid by property taxes through
the County's Fire Municipal Services Taxing Unit (MSTU) because the City Commission chose to consolidate fire
services with Seminole County in order to eliminate fire assessments and to help reduce the cost of the delivery
of fire services.
3. Property taxes which are based upon the value of real estate causes higher valued properties to pay a
disproportionately higher rate of cost for the delivery of fire services when compared to fire assessments.
4. Fire assessments by their very nature are designed to recover the cost of providing fire services to real estate
based upon the cost of delivery of the service. Therefore, fire assessments more fairly distribute the cost based
upon the actual cost of delivery of the service as opposed to property taxes which are based upon the value of
real estate.
5. Fire assessments which were levied in Tax Year 2007 shifted the cost of fire services downward causing people
in lesser valued real estate to pay more while persons in higher valued real estate paid less.
6. When fire assessments were eliminated for Tax Year 2008 in favor of a return to property taxes, the cost of
providing fire services was once again shifted disproportionately upward to higher valued real estate.
~I~E CONSOLIDATION
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On June 23, 2008, the City Commission approved an interlocal agreement consolidating the Winter Springs Fire Department
with Seminole County. This consolidation will become effective October 2, 2008. Following are answers to questions
Winter Springs residents have been asking about consolidation.
1. Why is the City consolidating the Fire Department with Seminole County?
The topic of fire consolidation is not new to Seminole County. The city ofAltamonte Springs consolidated its Fire Department
with Seminole County in 2002. Since that time, this consolidation effort has proved to be extremely successful.
The City of Winter Springs also explored the possibility of consolidation with Seminole County in 2004. At that time, it was
determined that consolidation would not be in the City's or its resident's best financial interest. Since that time, several
factors have changed that now make consolidation feasible. As shown in question #2 below, consolidation will now
actually save Winter Springs' taxpayers money.
Additionally, revenue constraints placed on the City by the Governor and Legislature, via prior legislative actions and
Amendment 1, make it nearly impossible for the City to continue to fund its Fire Department at the levels necessary to
recruit and retain firefighters and to provide the highest level of service to our residents.
2. Some people are saying that "consolidation will make my taxes go up." Is this true?
No. As shown below, fire consolidation has actually lowered the cost of fire and emergency medical services to the
residents of Winter Springs.
TABLET
Millage Equivalent to Retain the Fire Department 2.4335 As shown in Table I,
County MSTU Millage 2.3299 It would have cost City residents an additional
Millage Savings to City
(0.1036) 0.1036 in millage to have retained the Fire
Department as opposed to consolidation with the
County.
TABLE II
Millage Equivalent to Retain the Fire Department 2.4335 As shown in Table II, ~.,
Additional Retirement Benefits o.274s It would have cost City residents an additional m
Additional Pay 0.0325 0.4110 in millage to have retained the Fire
Total Millage
2.7409 Department and provided the fire union with
additional pay and benefits equal to those offered
County MSTU Millage 2.3299 by the County as opposed to consolidation with '
Millage Savings to City (0.4110) the COUnty. -~-+
TABLE III
Millage Equivalent to Retain the Fire Department 2.4335 As ShOWn In Table III,
Additional Retirement Benefits o.27as It would have cost City residents an additional
0.6573 in millage to have retained the Fire
Additional Pay 02788 Department and provided the fire union with the
Total Millage 2.x872 additional pay and benefits they were demanding
County MSTU Millage
2.3299 to remain in the City.
Millage Savings to City (0.6573) -
3. When does consolidation take effect?
Consolidation will become effective on October 2, 2008. Transition plans are being accomplished smoothly.
4. What do I do if I need fire or emergency medical services after the effective date of consolidation?
The delivery of fire and emergency medical services to Winter Springs' residents and businesses will not change. It is
important to remember that fire and emergency medical services have been consolidated from an operational standpoint
for years.
As always, please call 9-1-1 for assistance from the Fire Department. You will likely be assisted by many of the men and
women from Winter Springs that have served you in the past.
5. Will the quality of Fire and Emergency Medical Services go down?
No. If anything, the quality of services will probably get better. Again, fire and emergency medical services have been
consolidated from an operational standpoint for years. What has not been consolidated is the administrative overhead.
Consolidation eliminated more than $200,000 in Fire Department overhead in Winter Springs.
6. Will the location of the current fire stations change?
No. All three Winter Springs stations will remain in their current locations. A rescue unit will be added at Station #28
(located at City Hall) to improve service to that area.
7. Since the City is consolidating the Fire Department, why do residents have to pay the fire assessment?
Fire assessments were adopted to help pay the cost of the Fire Department in the current (FY 08) budget year. Consolidation
does not take place until the next (FY 09) budget year. In the next (FY 09) budget year, the full cost of the Fire Department
will be paid by the County Fire Municipal Service Taxing Unit (MSTU) tax. Therefore, fire assessments will no longer be
needed to help pay for the Fire Department.
8. What will happen if property owners do not pay their fire assessment bill for the current year?
Eighty percent (80%) of property owners have paid their fire assessment. The bills for the remaining twenty percent
(20%) who have not paid will be turned over the Tax Collector for collection in the manner that other delinquent taxes are
collected.
CITY STRUGGLING TO CLOSE MILLION-PLUS
BUDGET GAP
Under normal circumstances belt tightening by the City could have overcome extraordinary increases in expenditures
caused by unprecedented increases in energy costs. However, the addition of a loss of approximately $1.1 million in
revenue has placed City policy makers in a difficult position.
Several years ago the City, with the input of a broad citizen initiative to redirect the vision of the City, set a goal to become
recognized as one of the premier cities in the nation. That goal was first achieved in 2004 when MSN Advisory Services'
ranking criteria identified Winter Springs as the best city in the nation in which to own a home. In 2007, Money Magazine
ranked Winter Springs the second best city in Florida and 31st best city in the nation in which to live. Budget decisions
'' that the City Commission will make this year will have an impact on the City's ability to maintain itself in the top ranking of
,~ great places in which to live.
At issue are revenue losses resulting from legislative mandates in fiscal period 2008 that resulted in the City reducing
property taxes by 24%, and an additional estimated $1.1 million loss in revenue in fiscal period 2009. Fiscal Year 2009
losses will result from the passage of Amendment "1" and the downturn in the economy. Amendment "1" will cost the
City an estimated $545,000. Another $565,000 loss in state revenue sharing and interest earnings will result from the
downturn in the economy. As stated above, this year's budget crisis is further complicated by extraordinary increases in
fuel and electricity cost that have caused steep increases in the cost of operating the City's fleet of vehicles, especially
police; street lights; and energy intensive equipment such as utility treatment and pumping stations that run around the
clock.
Resident dissatisfaction with the City Commission's effort to raise additional revenues through fire assessments led to the
consolidation of the City's Fire Department with Seminole County. In further action, the Commission cancelled $800,000
~ in community events and other operating expenses, and delayed several City projects. Further belt tightening by City
departments for the fiscal period 2009 budget, which becomes effective October 1, 2008, resulted in an overall 8.9%
decrease in expenditure requests. However, these belt tightening efforts are not sufficient to overcome the remaining
$1.1 million shortfall in revenues.
SERVING YOUR COMMUNITY ' ~~`
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Let us know if you want to serve on one of the City's Advisory Boards. .~~,
• Beautification Of Winter Springs Board
• Board Of Adjustment ~ ~~
• Board Of Trustees (Pension Plan) ~ a ~~
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• Code Enforcement Board
• Oak Forest Wall And Beautification District Advisory Committee ~'._
• Planning And Zoning Board/Local Planning Agency _~
• Tuscawilla Lighting And Beautification District Advisory Committee ~,;''
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All Advisory Boards and Committee Members are appointed by the Mayor and City Commission, If you are interested~l~;
your community in this way, please contact the Office of the City Clerk for more information and to request arr;appj~a
407-327-5965, 407-327-5999, or 407-327-5955, or visit the city's website at www.winterspringsfl.org »nd Gick on BQa