MARK SCHUMANN

Without exception, all four members of the Vero Beach Finance Commission present at yesterday’s Commission meeting expressed concerns over the City Council’s plans to rely on steep spending cuts to balance the city’s budget in the wake of the sale of the electric system.

Critiquing the Council’s plans to cut $1.4 million out of the general fund budget beginning in October, Finance Commission member Scott McCracken said, “I thought from the get-go it was going to be a combination of raising taxes and trying to cut spending.”

McCracken said reducing spending 10.9 percent without expecting to drastically impact services is unrealistic.  “I think it has got to be a combination of the two. Somebody just doesn’t want to make the hard decision and say that,” McCracken said.

“If you get through this cut this next year, you’ve got a pretty thin budget going forward,” said commission member Glen Brovont.

“We may have gone too far, but we won’t know until we’ve done it.  I am concerned about the quality balance in the police department and in planning and zoning,” he added.

“I think we have come to the crossroads in Vero Beach that we have been and have considered ourselves a real diamond in the area…Historically we have expected more,” said City Manager Jim O’Connor.

“We also chose that we are going to have one of the largest parks for a city of 15,000, Riverside Park, and we are going to maintain it in a form and a fashion that makes it look outstanding.  And then to compliment that, we have three gorgeous parks on the ocean, with Jaycee, Huminston and South Beach.  And we’ve done things first class,” O’Connor added.

Now, O’Connor said, the city faces the choice of what he termed the “Walmart or Macy’s syndrome.”

“We would need to raise (city) taxes 50 percent to cover the loss of the revenue from the power plant,” McCracken said.  “Vero Beach is roughly 10 percent of the total tax bill, so really you total tax bill would go up five percent.”

Commission Chairman Peter Gorry pointed out that in 2007, the city collected approximately $2.4 million more in taxes than in the current fiscal year.  Since 2007, Gorry explained, the city’s tax rate has come down, as has the taxable value of properties within the city.

Commissioner Kathryn Barton said she is not sure why there is such an aversion to raising taxes.  “If people want services they are either going to have to pay a user fee, or they are going to have to pay more in taxes,” Barton said, adding that if city residents are going to pay significantly less for utilities they can afford to pay more for taxes.

For the first three years following the sale of the electric system, the city’s projected budget shortfall is estimated to be approximately $1 million.  After the third year, Florida Power & Light would no longer be paying rent on the power plant site.  At that point, the budget deficit, compared to the 2012/2013 budget, would be closer to $2 million.

At present, the Council is on course to cut $1.4 million from the general fund budget beginning October 1, despite the fact that serious questions remain over if and when the electric system will ever be sold.

Following what he insists are his marching orders, City Manager Jim O’Connor has prepared a budget predicated on the assumption that the electric system will be sold by March 31.  In the kindest terms possible, Gorry has made it clear he believes that assumption does not square with reality.

The City Council will begin five days of budget workshops Monday, July 8 and 9 a.m.