A taxing time for LBK

AL GREEN

Contributing Columnist

algreenpsu@verizon.net

The selection of Hal Lenobel to repeat previous tenure as mayor could not come at a more propitious time.

The financial situation facing the town is probably the direst since the town was founded.

Longboat Key depends upon three major sources for its funding.

First of all, there is the real estate tax. Last year, the town received 1.4 mils of the assessed value of all the real estate on the key or $700 a year if your home met the average ($500,000) of all homes on the key.

The second source is the money that comes to the town from the county as their proportion of the sales and gasoline taxes. This amount is determined by the permanent population, not the capitol value unfortunately.

The third portion is the money received by the Building Department for permit and other fees. For budget purposes this is kept separate, but ultimately any shortfall is still the responsibility of the taxpayer.

There are other small sources and possibilities, but for our purposes, we will keep it simple.

In the case of the real estate tax, the assessed value of properties is going down dramatically. The latest estimate is for a 5 percent drop this year. This will continue to drop as more homes and condos are reappraised as their selling prices will dictate. This is in dramatic contrast to the almost continuous 11 percent rise we have seen over the past 10 years.

You don’t need to be a reader of the Wall Street Journal to know that people are going to be spending less and using less gasoline as the recession grabs even stronger. Consequently, you can look for a cut back in the revenue from sales and other taxes.

With real estate in the dumps, new construction will almost disappear. New construction permits are already down. The best builder on the key told a friend of mine that for the first time in his construction career, he has no projects lined up. In this kind of atmosphere, it would seem that raising permit fees on smaller rehabs would also be counter intuitive.

When you line up all these potential land mines and put it against the future requirements of the town, you have a serious problem. It also doesn’t help when the state has advised the town that its pension fund is under-funded.

Longboat Key’s budget is almost 75 to 80 percent devoted to personnel costs. These costs do not leave much room for maneuver. Pension contributions (see above) are required, and the annual cost of living increases, along with the step-raise policy, make that portion of the budget unlikely to be any help. Since normal inflation will not be interrupted, you can count on gas and electricity also going up. In short, there is trouble in River City.

This is all coming to a head just when Gov. Charlie Crist, demonstrating what a great vice president he would make, decided to involve the state in local government tax policy.

It is now state law that a town cannot raise their millage rate more than 10 percent without either a unanimous vote of the commission or a referendum. I believe that these are the decisions that are going to come into play.

This is where strong leadership and a group acting like grown-ups are going to be needed.

Up to now, your commissioners have been acting as if they needed their jobs to put food on the table, and if any two citizens would look at them with an unfriendly glare, they would melt on the spot. In short, they conducted their business as if the only thing that was important was being well liked.

When former Commissioner Bob Dawson barked, they bowed. They cut the budget to the bone and then some. You can already see evidence of the cut back if you drive down Gulf of Mexico Drive. The hard fought sign code observance is almost nil because there is no code enforcement, because the job wasn’t filled when it became vacant. This is just a harbinger of things to come if the Commission doesn’t face up to reality.

There is no easy solution. If you eliminate the Police Department, the county will charge you at least as much as you are paying to provide Sheriff Department coverage. If you closed down the entire town and became an unincorporated part of the county like the southern end of Siesta Key, you would have your county tax raised at least as much as you are currently paying for the local control.

The commissioners will have to put their economic future in jeopardy. All of the pay they get, all of the perks, all of the glamour of being a town commissioner will have to be put at risk. They will have to read terrible things about themselves in the paper.

In short, they will have to take some heat and say to the public, “we cannot cut enough from the budget to make up for the shortfall without seriously jeopardizing the quality of life that you are enjoying by living on Longboat Key.”

You are going to have to accept or vote an additional tax increase that could come to be as large as $150 if your home is worth a half of a million dollars. You might have to not go to Euphemia Hay or Café on the Bay one time. It will be hell. You can do it.

I just don’t know if your commissioners have the guts to ask it of you. That is up to Mayor Hal Lenobel. The commission won’t go there alone – he is going to have to take them by the hand. Unlike the federal government, Longboat Key cannot print their own money – they will have to earn it.

A few reports back I wrote that PIC was no longer a factor on Longboat Key. Last week, the PIC green letter was distributed by the Longboat Observer. Ironically, it was to offset the Observer’s bias that was the motivation for the formation of PIC and their once very important letter.