The St. Lucie County Commission decided to follow staff’s suggestion and reduce Hutchinson Island erosion tax

FORT PIERCE – During its final budget hearing on the 2021/2022 millage rate and fiscal year budget, the St. Lucie County Commission agreed Sept. 23 to a Hail Mary change enabling a reduction of the millage on the South Hutchinson Island Municipal Taxing Unit and an even lower aggregate millage rate.

Management & Budget Office Director Jennifer Hill alluded to the potential amendment to the proposed budget as part of her formal budgetary announcements.

“The Fiscal Year 22 Budget being presented to you tonight is $615,783,565, which is funded from a variety of funding sources,” she said. “Later in this presentation, the Board will be presented with a potential change that could affect the total budget and the millage rate if the Board were to choose to accept the change. The overall Board of County Commissioner workforce is budgeted at 863.13 full-time-equivalent positions, and the aggregate millage rate is 8.5630 mils. While some of the [municipal service taxing unit] rates are increasing, others are decreasing, resulting in a 0.2057 mil reduction in the aggregate millage rate.”

The potential change Ms. Hill referred to was the result of staff research after the first budget hearing on Sept. 9, during which Regency Island Dunes Homeowners Association President Jimmy Tigue bemoaned the fact that only South Hutchinson Island residents bore the cost of beach nourishment.

“Our beaches are a local, shared resource that benefit everyone in St. Lucie County and not just South Hutchinson Island residents,” he said during the earlier meeting.

Indeed, the additional millage placed upon South Hutchinson Island property owners does add a significant amount to their annual tax bills, but Commissioner Cathy Townsend reminded Mr. Tigue after his comment that “it was the residents [themselves] that came to the county and asked for that special assessment.” While Ms. Hill had emphasized during that first budget discussion that the county had little leeway in reducing the taxes due to a lot of unknowns on the project, she did receive encouraging news from the U.S. Army Corps of Engineers in the interim two-week period.

“Some of the things that were unknown when we developed the original budget back at the beginning of the summer have since progressed in our favor,” she explained on Sept. 23. “Loan rates came in lower than estimates; the Army Corps reduced their construction estimates prior to going out to bid, reducing the amount that we had to pay upfront; and our senior coastal engineer has worked with the state to allow for our state grant to fund the first year of monitoring costs. Giving what we know now, staff is comfortable with reducing the millage rate from 0.7455 mils to 0.6613 mils, or a 0.0842 mil reduction.”

That reduction would reduce the annual property tax bill on the SHIMTU by approximately $100,000 annually over the course of the next eight years. Ms. Hill provided additional clarity on how the reduced South Hutchison Island millage rates incorporated into the aggregate county rate would potentially impact St. Lucie County property owners over the next Fiscal year.

“If you look at how the proposed millage rate changes affect a $295,000 homesteaded home, a property located in one of the cities would see a $61.25 decrease,” she said. “A property located in the unincorporated county other than South Hutchinson Island would see a $31.02 decrease, and a property located on South Hutchinson Island would see a $99.42 increase under the original proposal, or a $78.79 increase if the Board agrees to the alternate proposal.”

The Board agreed to the change and voted 4-1 to approve the amended millage rate, with Commissioner Townsend – who’s opposed both the millage and the budget since the onset – dissenting.

The Management & Budget Office director also provided the Commission details on the proposed 2021/2022 budget, which had also been tweaked since the first budget hearing.

“The budget being proposed tonight reflects an increase of $633,586 over the budget that was presented at the tentative hearing, bringing the total budget from $615.1 million to 615.8 million,” she said. “The changes are due to three adjustments: increases in sales tax revenue, which will cover differences between the original budgeted cost-of-living rates and the rates approved as part of the union negotiation process; a $100,000 revenue increase based on revised projections in constitutional gas tax revenue for our Transportation Trust Fund; and a $29,500 increase in our Fine & Forfeiture Fund for shared pretrial services.”

Ms. Hill pointed out that St. Lucie County has become leaner and meaner since the recession that took the wind out of the sails of the construction boom in the early 2000s.

“The county’s budget is going from $591 million to a tentative $615 million, with a population that has gone from 278,000 to a forecasted 335,000, or an increase of 57,000 people,” she said. “Over this timeframe, the budget has increased 4 percent while the population has grown by 20 percent. The county is operating with 120 less positions than in 2007. For next year, we’ll be operating with a workforce that is the size it was in 2004, but over that 18-year period, our population is projected to have grown by approximately 47 percent.”

Ms. Hill also addressed the frequent complaints by citizens that St. Lucie County has one of the highest millage rates in the State of Florida. She used statistics to show that the county’s non-aggregate millage of 8.7684 mils was only slightly higher than the state average of 8.0333 mils, while its taxable value is actually lower than the Florida average.

“For the current fiscal year, the aggregate millage rate levied by all taxing districts in St. Lucie County was 23.2597 mils,” she explained. “Of that, 8.7684 mils were levied by the St. Lucie County Board of County Commissioners, which includes funding for the constitutional officers, dependent districts and municipal service taxing units. We are recommending a millage rate reduction; however, it will take a collective effort by all taxing agencies to make a significant impact on the overall tax bill.”

The Board subsequently voted 4-1 to approve the amended budget, with Commissioner Townsend dissenting. The latter also voted against the 2020/2021 millage rate, consistently arguing that the county’s ad valorem reductions were insufficient. In contrast, Commissioner Frannie Hutchinson lauded staff for following the Board’s direction on Sept. 9 to find a way to further lower the millage, particularly for the South Hutchinson Island property owners who would be the only county residents to see a property tax increase this year.

“I offer my thanks to the staff for having worked tirelessly as things were changing by the moment with phone calls flying right and left trying to get us there,” she said.

County Administrator Howard Tipton, likewise, offered praise to commissioners for their effort to trim the 2021/2022 Fiscal Year Budget.

“The state of our county – despite all the challenges – is strong and getting stronger,” he said. “That is a direct reflection on the leadership that this Commission has provided through your adopted strategic plan, your strategic business investments [and] your strong fiscal stewardship that minimizes debt and reduces the property tax rate for next year by the largest amount in recent history.”

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