MARK SCHUMANN

At the conclusion of a preliminary budget workshop this week, Vero Beach City Manager Jim O’Connor and Finance Director Cindy Lawson were asked to assume a 30 precent increase in the city’s property taxes as they prepare a draft budget for the 2015/2016 fiscal year.  Formal budget workshops begin in July.

Faced with a budget shortfall of $1.5 million in operating expenses and $1.1 million unfunded capital needs, at least a majority of the members of the Vero Beach City Council seem prepared to reverse the city’s recent trend of continuing to cut expenses.

“I think we are at the point where we are going to have to increase taxes, or we are going to have to cut beyond what our citizens want,” said Councilman Randy Old.

In 2006, Vero Beach’s property tax rate was 2.29 mills, which equates to $2.29 per $1,000 in taxable property value.  Since 2006, the council has cut the rate to 2.03, while also deferring maintenance, reducing some services, and most significantly cutting the city’s employee count from 527 to under 400.

“We went from one extreme to the other and now we have to find a balance,” said Councilwoman Amelia Graves, adding, “If I am worried about re-election, then I shouldn’t have this job.”

For the average Vero Beach property owner, city taxes make up 11 percent of their annual property tax bill. An increase of 30 percent in city’s tax rate, if ultimately approved, would result in an additional three percent in the total property tax bill issued by the Property Appraiser’s Office

“We are not throwing a lot of money around,” Old said. “We are not wasting a lot of money. There’s no way to cut more. We’ve done that.”

Old pointed out that among Florida’s 400 incorporated municipalities, Vero Beach ranks 336 in its tax rate.  An increase to 2.69 mills would, Old said, leave Vero Beach ranked 308th, with 75 percent of Florida cities still assessing higher taxes.

Regionally, Sebastian’s tax rate is 3.7 mills, Fellsmere 5.6 mills and Melbourne 6.9 mills.

Councilwoman Pilar Turner said it will be important to show taxpayers what value they would receive in return for higher taxes.

For his part, Vice Mayor Jay Kramer, who is challenging Bob Solari for a seat on the Indian River County Commission, was having nothing to do with talk of higher taxes. “Just for the record, I’d like to see the millage rate stay where it is, and I’d like to see a little discipline,” Kramer said.

Mayor Richard Winger said Old’s encouragement to look at a five year budget brought to light the consequence in future years of continuing to “kick the can down the road,” by deferring needed maintenance and delaying needed purchases.

For example, Winger said, some of the city’s police cars are more than 10 years old, and are increasingly expensive to maintain.  Though $700,000 is needed each year to keep up with street repaving on a 25-year cycle, the city budgeted and spent just $200,000 on paving in the current fiscal year.

A tax increase of 30 percent would raise approximately $1.2 million in additional revenue, only partially addressing a total budget shortfall of some $2.5 million. The council would still be left to find additional savings in the operating budget and to make choices among proposed capital projects.

“The idea of saying “no, no, no, no” is just past. We can’t do that any more,” Old said.