Editorial | The challenge of taxing times ahead
Cape Coral Mayor John Gunter’s message to residents touched upon taxes this month as the city gears up for its annual budget process.
“City Council took an important step by reducing the millage rate for Fiscal Year 2026 while still providing the funding needed to support essential infrastructure in the City,” he wrote in Cape Connect, the city’s newsletter. “This decision reflects Council’s commitment to fiscal responsibility-carefully balancing the desire to lessen the tax burden on our residents with the need to invest in critical priorities such as public safety, roads, drainage, and utilities.
“Looking ahead, Council will be making difficult choices for the 2027 budget based on updated information from the Lee County Property Appraiser, and we will continue to evaluate how to best allocate limited resources to protect our quality of life.”
With the state legislature returning for a special session later this month because the elected body failed to pass either a budget or promised tax reform, Mr. Gunter’s message is a timely one.
And the mayor is correct — at its last budget hearing for the fiscal year that began Oct. 1, city council did reduce the property tax rate, opting for the “rollback” rate of 5.1471 mills. That is indeed lower than the rate of $5.2188 for each $1,000 of taxable property valuation assessed the year before. The difference between the rollback rate approved at the final budget hearing and the rate approved at the first was collectively a total of $2,200,734 less.
To imply that taxes in the city went down for property owners, though, is disingenuous at best.
To fund its total budget of $1,434,847,653, including the city’s general, or operating, fund of $262,501,397, council increased other taxes, which carry the monikers of non-ad valorem “fees” and “assessments.”
Council raised the levy for fire protection services from 70% to 81% of the cost of Cape Coral Fire Department operations to “capture” those costs via a separate property-based fee.
At 81% cost recovery, the assessment for an average single-family home came in at $529.76. At 70% cost recovery, it was $438.48.
The fee for stormwater services was set at $156, up from $149, to allow the city to increase current lines of service for operations and maintenance, officials said.
Own a vacant lot?
The city requires mowing and charges for that on tax bills with rates increasing except for lots in district one which had been paying more for Hurricane Ian cleanup that was now complete.
Annual residential rates for solid waste also saw an increase of nearly $40 per home but we’ll give the city that one — the charge is essentially a pass-through cost and collection and disposal fees both went up.
We rehash these numbers for two reasons.
One, clarification: If the mayor’s message made you think your tax bill went down, it likely did not. Most of us saw a bump.
Two, tax bills are not likely to go down next year either, even if the Florida Legislature takes another wack at reform as it works to pass a budget at its special session.
Government entities, including the city of Cape Coral, have already looked ahead at options to help recoup money they receives from ad valorem property taxes, the primary source of funding for city and county operations.
Among the options discussed — we emphasize discussed — by council earlier this year after Gov. Ron DeSantis’ cry for the elimination of such property taxes were:
— Raising the city’s Fire Assessment Cost Recovery from 81% to 100% of the cost of operations. Using this year’s numbers, the tally would be about $14,508,333 based FY 2026, number or an increase from $64 million to $78.5 million. The assessment is a tax on property, though not a “property tax.”
— Adding another 3% to the city’s Public Service Tax- now at 7 % plus a 3% franchise fee — to go from the current $16 million received to $22.9 million. That would be a collective 13% tax on electric bills.
— Increasing the millage rate. If you don’t fall into the “tax break” category approved — for example if you own a lot, a rental property or second home, or a commercial parcel — you would pay more.
Probably a lot more,
— Imposing a local sales tax of a half-cent to a cent and a half, if the state would allow it.
Bottom line, regardless of what governments call them, taxes are here to stay.
Government services must be funded.
Let us reiterate the latter part of Mayor Gunter’s message:
“This decision reflects Council’s commitment to fiscal responsibility-carefully balancing the desire to lessen the tax burden on our residents with the need to invest in critical priorities such as public safety, roads, drainage, and utilities,” he wrote.
“Looking ahead, Council will be making difficult choices for the 2027 budget based on updated information from the Lee County Property Appraiser, and we will continue to evaluate how to best allocate limited resources to protect our quality of life.”
The emphasis on “limited resources” is ours.
We wish our elected officials well on their budget process in a year fraught with uncertainties.
We agree their task ahead may be a difficult one in terms of choices.
We will, however, hold them to the mayor’s promise and premise… both “Council’s commitment to fiscal responsibility” and the “we will continue to evaluate how to best allocate limited resources to protect our quality of life.”
May our elected officials be up to the challenge of the taxing times ahead.
Breeze editorial