Editor’s note: Richard Winger is a member of the Vero Beach City Council.
The Good news is property values have increased by 6.9% and is expected to provide an additional $400,000 to City revenues this year.
The Bad news is we are going into our Annual Budget preparations with an existing more than a million dollar shortfall in funding for just street and storm water repair. And, there is not enough money for existing staff.
Please don’t accept arguments that the City has too many employees. That simply is not true. Past Councils have systematically reduced staff to a barebones level.
The Ugly is there is no other significant revenue increase coming in. And, there will be a loss of annual funds, once the sale of the Electric Utility to FP&L is completed.
In much the same way an investor-owned Utility passes profits to its stockholders, the City uses profits from the Electric Utility for the benefit of the community. The law says an investor-owned utility is allowed to pass along 11% of equity in profits to its stockholders. By contrast, the City’s Electric Utility passes 4.6% to the General Fund. This figure is approximately $5,400,000, not counting more than a million lost to the City for services provided the Utility. The City’s annual budget is estimated at $23,000,000. The negative potential of this lost revenue is huge.
Not only is the City challenged to provide services this year, but the conversation must start now to address those services in the future or the City will be ill-prepared to provide you a stable future. We simply cannot kick the can down the road.
One other point needs to be made at this time. The sale of the Electric Utility will not leave the City flush with funds and we must accept this reality.
The law stipulates how funds from this sale may be used. They cannot simply be shifted to various line items on Excel spreadsheets. It is complicated but there is one thing that is very clear. After all obligations, such as bonds, are paid off, there will be limited residual capital, optimistically $30,000,000 or $40,000,000, with which the City can invest in its’ future. The law also specifies such investments must be very safe securities, which traditionally carry a low yield of one to two percent.
The Budget meetings are July 10, 11 and 12 at City Hall. These meetings don’t usually attract a packed audience. Maybe the perception is the time is spent on tedious discussions of columns on Excel spreadsheets. Not usually, but the discussion absolutely must expand this year.
The priority would be to create a fiscal plan for the coming year which maintains services we rely on while simultaneously planning for future years. It is short-sighted to focus only on the year ahead.
This is your City and your future. You are welcome to attend and comment on your priorities for the City. You will be heard, and that is Very Good.
Sincerely, Dick Winger
P.S. Please pass this message to your friends and neighbors. Thank you.