Increase tax revenues without raising homeowner taxes

So here’s the thing. Palmetto Bay residents don’t want to face reduced services and programming in upcoming years. In fact, I’m pretty sure they would like more instead of less. I’m also sure they don’t want to see their property taxes go up. Who would?

It doesn’t have to be an either/or choice. There is a third option, but one way or another a choice will have to be made. Why?

The cost of everything is going up, and this applies to a city’s expenses as well as households. At the same time that costs are increasing, revenues are staying the same or even decreasing a little. At present, 82 percent of ad valorem taxes in the village are from residential households, and 70 percent of residential units are homestead exempted.

Taxes in Palmetto Bay are only 11 percent of the overall county tax bill. The village had the third lowest increase in ad valorem taxes, at 3.3 percent, while the county average was more than 8.5 percent. This is due to homestead exemption and not much business tax revenue. The population also has decreased a bit in the past few years which has reduced the village’s share of sales, utilities, CITT (Citizens Independent Transportation Trust), gas and other shared taxes that are based on population.

The police budget is about $7.2 million, yet ad valorem revenue last year was only $5.7 million. There is a real danger of having to use reserves to cover everyday expenses.

What is the best solution?

Building a downtown area that will increase commercial revenue makes the most sense. At the Franjo Triangle Charrette in 2004 Mayor Eugene Flinn began the process of revitalizing the area, but the needed infrastructure was lacking and the downturn in the economy put everything on hold.

Not long ago, the Downtown Redevelopment Task Force was created, at the suggestion of Council member Tim Schaffer, to review, improve and jump start the process in an economic model, using property owners and business owners in the area instead of government for providing direction and advice.

Market studies show that downtown revitalization will increase ad valorem tax revenues by $1 million in phase one alone, and that up to 1,800 new jobs could be created in the downtown area.

The county’s planning studies show that south Miami-Dade will grow substantially in the coming years, and village surveys show more than 80 percent approval for the downtown project.

There is a shortage of office space that requires people to commute outside of the area, spending on average an hour on the road each day, coming and going. More office space would help, and an improved commercial district could reduce short term trips as well.

Palmetto Bay Downtown Redevelopment seems like a win/win for residents in all ways.

The alternative to smart growth is to raise tax rates, and that’s a scenario no one wants. A complete community, with the parks, schools, water, and a well-planned downtown area will elevate the value of all the homes and vastly improve the quality of life and sense of community.

Those are the choices. Let’s go with the best one.

 

 


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