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County auditor: Price to pay for lower taxes

By Wesley LeBlanc Staff Writer
Posted 9/18/19

GREEN COVE SPRINGS – Clay County Commissioners said their tentative budget is bareboned. While that may seem like a win for taxpayers, the county’s auditor said Clay may soon face a financial …

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County auditor: Price to pay for lower taxes


Posted

GREEN COVE SPRINGS – Clay County Commissioners said their tentative budget is bareboned. While that may seem like a win for taxpayers, the county’s auditor said Clay may soon face a financial reckoning.

For the taxpayer balancing their checkbook, the 2019-20 fiscal year will be a good year after the BCC chose to hold the line on their millage and drop a $60 stormwater utility fee. County auditor Mike Price warned the Clay County government will soon face an important decision: maintain its barebones budget and subsequently a bareboned line of service or increase taxes and provide necessary services.

“You get the government you pay for,” Price said.

There are plenty of areas in the county that need tax dollars, but there are so many budgetary constraints that prevent the BCC from approving a one-stop-shop fix-it-all directive.

Chief among those constraints are the categorized funds, according to Price.

Government used a budgetary method known as checkbook balancing until around 1975. It started when small towns popped up in the Midwest during westward expansion. When a town needed a school, a hat would be passed during a town hall while officials asked residents to help pay for the school.

“If you wanted to help out, you’d put money in the hat and if you didn’t, you wouldn’t,” Price said.

Eventually, some town officials betrayed the trust of the town and used the money on other projects. The town, in turn, asked future money to be put into a bank and monitored.

“They’d say, ‘don’t let the sheriff use this money because it’s for a school,’” Price said. “What happened eventually, was that we had checkbooks or accounts for each thing we wanted to build.”

Then, in 1975, the federal government decided that multiple accounts were superfluous, and it came up with line-item fund budgets.

“You can’t use money from this fund for something that should be done with that fund,” Price said.

The same budgetary constraint has prevented governments from completing some projects. If the BCC wanted to fix a roof on a public building at a cost of $15,000, they would need $15,000 in a fund for roof fixes. If they don’t have enough money in the fund, they can’t fix the roof with money from another line item.

“You can’t raid funds so what you get is a government with their hands tied,” Price said.

A proposed budget of $356,443,389 appears to be a lot. What makes it challenging is how the money is divided into different line items.

Clay County government also will soon meet head-on is its consistently-decreasing reserve balance – its savings. If the BCC continues to maintain the millage rate, it will have a tough time putting money away for an emergency.

“I’ll tell you what that means to an accountant and when you put this in the paper, everyone’s going to hate me and I’m going to be the guy with the horns at the county, but here’s what it means: the tax rate is too low in this county,” Price said. “This is just like business. When you go into a business, if you said, ‘I’d like this, but I don’t have any money,’ they’d say, ‘well come back when you’ve got some.’

“If you’ve got the money, you can have the service. In government, we don’t have that luxury so if somebody comes in and says, ‘we’d like this service, but we can’t pay for it,’ we have to pay for it anyway. So now you have a choice: you either dig into reserves until you don’t have any reserves left and can’t provide that service, or you balance your budget by cutting a service out or increasing taxes, or a combination of those two.”

That’s the juncture that Clay County is coming to, according to Price.

The BCC eventually will have to decide what kind of services it can provide. A government that charges lower taxes simply cannot afford to provide a wealth of services like a government with higher taxes.

St. Johns County has remained one of the state’s top counties. It has the highest-rated school district in Florida, a sheriff’s office with state-of-the-art technology and low response times, and highly-rated EMS services. Some that county’s success can be attributed to the people that hold offices, but one thing cannot be denied: they pay a lot of taxes. And as Price said, the more taxes residents pay, the better their local government’s service.

In the tentative budget, ad valorem taxes are expected to bring in $89,555,424. That’s what the property taxes covered by Clay County residents is expected to bring in to the budget. That doesn’t cover the cost of public safety, which clocks in at $102,512,921.

You might say, “lower the cost of public safety,” but that’s not necessarily impossible. The Clay County Sheriff’s Office already faces a dearth of officers and subsequent increased response times.

While county manager Howard Wanamaker created a balanced budget for next year, Price fears the county could run out of money.

The BCC may soon have to ask residents what the future they want: Should taxes remain low? If so, are residents willing to accept lesser services as a result? Or, are residents willing to pay the price for better services?

Price said the current budget can’t be trimmed any lower.

“The day of reckoning is coming,” Price said. “It’ll be up to the residents and their elected officials to decide how we handle that day."