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Room to maneuver

By Staff | Jul 21, 2012

In advance of setting the “not-to-exceed” tax rate as required by law, Cape Coral City Council is scheduled to hear a staff presentation on the millage on Monday.

Financial Services Director Victoria Bateman is scheduled to make the staff presentation which incorporates the property tax rate used in City Manager John Szerlag’s budget proposal. Mr. Szerlag’s working document to council maintains the current tax rate, which is 7.9570 mills, or just shy of $7.96 cents for every $1,000 of taxable valuation.

At 96 percent of the total tax levy (the standard budgetary estimate) this would bring in $67,934,883 in property tax revenues, the primary source of funding for operational expenses.

That’s an additional $2,497,101 from property taxes due, largely, to the slight bump in valuations this year.

When setting the not-to-exceed rate, Council can accept this levy or choose two other options: The board can cap the rate at a lower level, sending the city manager, Ms. Bateman and the rest of staff back to make cuts, or it can set the cap higher to give council the ability to add expenditures or projects as the formal budget talks and hearings get under way.

Council has until Aug. 6 to set the not-to-exceed rate, after which time they can still lower, but not raise, the millage.

Given both the political and economic climate, council can expect lots of citizen input Monday although the matter has been listed as a discussion, rather than voting item.

Our recommendation? Accept Mr. Szerlag’s budget as the starting point and set the cap at the current rate. That’s reasonable and something the vast majority of taxpayers can understand.

This is no blanket endorsement for “tax creep” of the type seen as the Cape’s overall valuation rose – and tax dollars were spent by the millions although the rate remained stable.

Far from it.

Absolutely, bring out the budget knives and hone them judiciously on position changes, additions and other costs. Such things remain matters for debate and if the rate can be lowered, council should do so.

But don’t reject flexibility out of hand by setting the cap unrealistically low to make a point – or earn a few.

Mr. Szerlag is correct in his underlying message: Capital investment, slashed to the bone in the plummeting valuation years, is a bill coming due.

Council must assure we are positioned to pay it.

– Breeze editorial