BRADENTON – West Manatee Fire Rescue commissioners held their first budget meeting of the year on April 21 and the hot topic was whether to raise the assessment rates for commercial and residential property owners in the district.
WMFR has a non-ad valorem assessment rate, meaning the rate is tied to the size of the building on the property instead of the property value, which is used to determine property taxes. The amount the district can raise assessment rates each year is capped by personal income growth, a five-year rolling number used to estimate increases in taxpayer income.
At the end of the meeting, commissioners were considering three different options – a zero increase, a 2.6% increase and a 4% increase in assessment rates. An option to increase to the allowable limit of 5.46% was deemed too high by commissioners and dismissed. Commissioners will vote at their May meeting to determine the assessment rate for the 2020-21 fiscal year.
At a zero increase, the district would be operating at a loss for the coming year, requiring the use of $189,436 in reserves on top of the estimated $7,285,989 in revenue from property assessments. This would keep the residential base rate at $190.57 plus $0.1124 per square foot over 1,000 square feet and the commercial base rate at $473.62 plus $0.2051 per square foot over 1,000 square feet. At current rates, the full assessment on a 2,000-square-foot residential home is $302.97. The rate for a commercial building of the same size is $678.72.
The second option, a 2.6% increase in the assessment rate, would be the break-even point for the district, requiring no spending from reserves and bringing the total revenue from assessments up to $7,475,424. Under this plan, the assessment rate for a 2,000-square-foot home would be $310.85 and $696.37 for a 2,000-square-foot commercial building.
The third option, a 4% increase, is the one that was recommended by Chief Ben Rigney and the largest assessment rate increase being considered by commissioners. Under the 4% increase, commissioners would have an additional $291,440 in operating funds and would be able to add $102,004 to the district’s reserves to be used in case of an emergency. Reserve funds also are used to save for new equipment, such as a new fire truck, and to float the district’s operating expenses in the early months of the fiscal year before assessment rate funds are received. Under this increase, a residential property owner with a 2,000-square-foot home would pay $315.09 in total assessments to the fire district while a commercial property owner with a 2,000-square-foot building would pay $705.87.
Due to the expected economic downturn as a result of the COVID-19 pandemic, commissioners expressed concern that increasing the assessment rate at all could be a burden on property owners but also, that if rates aren’t increased this year and the personal income growth number goes down next year, the district might have more than one fiscal year where it operates at a loss.
Commissioner Al Robinson said he’s concerned about the burden on taxpayers if assessment rates are increased and then the district has a significant rollover from the current fiscal year. He asked staff to look into the past five years of financials to see what the rollover amount typically is for the district. WMFR is currently at the halfway mark at six months in the current fiscal year.
For the 2020-21 fiscal year, beginning Sept. 30, Rigney said that he expects operating expenses to increase $188,653, including required raises for staff and anticipated increases in insurance and other benefits, along with expenses to set up the planned new administration building. He said he expects an increase in operating expenses of $221,009 for the 2021-22 fiscal year, which is also a negotiating year for the firefighter’s union.
After the expenses for a new fire truck expected to arrive in the coming weeks, Rigney said he doesn’t anticipate any additional large expenditures for equipment in the next two to three years or more.
Commissioners are expected to vote on whether to increase the assessment rate for the coming fiscal year during their May 19 meeting.
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