Volusia County residents could see their property tax bills go up as officials deal with increased costs and revenue shortfalls ― including a hike in the sheriff’s budget.
Budget pressures include a multi-mullion-dollar overestimate of revenues for the county’s new off-beach parking system.
County officials will present the recommended budget on July 22, and the County Council will set tentative property tax rates. The County Council could still lower the property taxes after that hearing. The budget and tax rates will be finalized at two public hearings in September.
As part of crafting the recommended budget, Chief Financial Officer Ryan Ossowski presented expectations for several funds to the County Council on Tuesday night, June 17.
The county levies both countywide property tax rates and taxes that apply to certain areas to pay for a variety of services.
Volusia County officials propose tax increase for General Fund, Law Enforcement Fund and Municipal Service District
The General Fund is charged countywide and is facing challenges. Because of that, county officials are proposing a flat property tax rate of 3.2007 mills; that’s still a property tax increase for people whose property values have gone up.
For example, a home with a taxable value that has increased from $250,000 to $275,000 would pay about $80 more in taxes at 3.2007 mills.
One thing putting pressure on the General Fund is that off-beach parking revenues have missed the mark.
The county launched a new off-beach parking system on Jan. 1 and expected to receive $7.1 million in revenue by the end of the year. It’s projected now that the actual number will be about $2.9 million, Ossowski said.
“It was high. It was based off a consultant. They told us what to budget,” he said.
The county also launched a new program for beach driving in October. Overall, both programs are expected to bring close to $1 million in extra money to county coffers with expenses considered. The program includes technical updates and free beach parking and driving for residents.
“We’re earning an additional million in revenue than we did last year while giving … residents free access to the beach and a new contract with automation that opens all the ramps all the time,” Public Works Director Ben Bartlett said.
The General Fund is facing other issues.
Among other things, outside expenses are increasing for things such as SunRail, the Department of Juvenile Justice, and state Medicaid contributions.
The Law Enforcement Fund and the Municipal Service District (which funds services in unincorporated areas) are proposed at a flat millage rate of 1.5994 mills and 1.6956 mills, respectively. Again, that would be a property tax increase because property values have gone up.
“The sheriff’s budget total request went from $140 million to $154 million, a little over a 10% increase,” Ossowski said.
The Municipal Service District fund’s challenges include dealing with lost revenue from the communications service tax, which the County Council voted to eliminate starting Jan. 1, 2024. It was a 5.22% charge on cellphones and other items and brought in about $3 million a year on average.
The fund is dealing with other pressures, and the county plans to use reserves to cover the gap in the next budget year and beyond.
District 5 Councilman David Santiago, who supported eliminating the communications tax, expressed concern over using reserves to cover the difference. Reserves are supposed to be for emergencies or “one-off things,” he said.
“This is a problem,” he said.
But it shouldn’t have been a surprise. County officials told the County Council in 2023 that if the council eliminated the communications services tax, reserves would be used to cover the gap.
At this point, property taxes that go into the Municipal Services District fund don’t even cover Sheriff’s Office expenses for the unincorporated areas.
“Essentially, the property tax doesn’t even cover the amount we’re transferring to the sheriff’s office,” Ossowski said. “We’re actually using utility tax on top of that.”
Some Volusia County taxing funds are expected to go to a rollback rate
The County Council tends to favor going to the rollback rate. That’s the rate that doesn’t represent a tax increase but is intended to generate the same tax revenue for the coming budget year.
The Library Fund is recommended to go to the rollback rate. The County Council also voted Tuesday night to pursue a rollback rate for the Fire District Fund.
The county has five taxing funds that property owners pay countywide, regardless of whether they live in a city. That’s the General Fund, the Law Enforcement Fund, the Library Fund, Volusia ECHO and Volusia Forever.
The other funds apply depending on where someone lives: The Municipal Services District, Ponce Inlet and Port Authority, Silver Sands Bethune Beach Municipal Services District, the Fire Rescue District and Mosquito Control.
This article originally appeared on The Daytona Beach News-Journal: Volusia residents could see higher tax bills thanks in part to hike in sheriff’s budget
Reporting by Sheldon Gardner, Daytona Beach News-Journal / The Daytona Beach News-Journal
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