Gainesville City Commission unanimously adopts 29% property tax increase over rolled-back rate, cuts only $327,372 from previous year’s budget

The Gainesville City Commission discusses their FY24 budget at the July 20 meeting

BY JENNIFER CABRERA

GAINESVILLE, Fla. – At today’s Gainesville City Commission meeting, the commission unanimously adopted a property tax rate that is 16.9% higher than the previous rate and 29.2% higher than the rolled-back rate. Despite previously calling a reduction in the General Fund Transfer “a $19 million cut to our government,” the proposed FY24 budget is only $327,372 less than the FY23 budget.

Today’s vote sets the maximum property tax rate

The vote today sets the maximum property tax rate for FY24; the commission could reduce it (but not increase it) between now and the end of September. A budget workshop is scheduled for August 21, and budget adoption public hearings will be held on September 7 and September 21.

Acting Director of the Office of Management and Budget Steve Varvel told the commission that the budget is currently balanced, with major revenue increases coming from property taxes and increased fire assessment fees and major revenue decreases from the reduction in the Government Service Contribution (general fund transfer from GRU to General Government). The increases in property taxes and the fire assessment fee will make up all but $1.2 million of the reduction in the transfer from GRU.

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On the spending side, almost all of the increases (a total of $9.9 million) went to Gainesville Fire Rescue and Gainesville Police Department. Cuts in other departments countered those increases.

75 positions cut, 27 of which are filled

Varvel later said that the City is actually cutting 75 positions (not the 72.2 on the chart), 27 of which are currently filled. He also said that the increase in Housing & Community Development is not new but just a transfer of funds from the City Manager’s budget to a different cost center.

Mayor Harvey Ward emphasized that 75 positions “is not trivial,” although only 27 of them are currently filled: “So this is not a painless process that we’ve been going through for the last several months to get us to this point to say, okay, it’s time to look at revenue sources. We’ve cut, cut, cut, cut, cut, and now it’s time to look at the revenue side of things.”

Commissioner Ed Book pointed out that they had “funded community organizations that previously were on the chopping block… And then most impressive to me is that this is while also increasing fire and police… When you talk about people and services and programs and vacancies, it’s an awful exercise from a City perspective.”

Proposed tax rate is 29.2% higher than the rolled-back rate

Varvel walked through the Truth in Millage calculations and said the rolled-back rate, which is the tax rate that would raise the same amount of revenue based only on valuation increases in the same properties that were on the tax rolls last year, would be 4.9764 mills; the tax rate that will be advertised is 6.4297 mills, 29.2% higher than the rolled-back rate. The Alachua County Commission recently set their maximum property tax rate at 7.5% over the rolled-back rate.

A hand-out showed the estimated increases in property tax payments for various home values and homestead status. For a $300,000 home with a homestead exemption, the increase will be $232.43 per year, or $19.37 per month.

Ward reminded the public that taxable values are different from the market value shown in Zillow; they are subject to Save Our Homes limitations and can be found on the Alachua County Property Appraiser’s website.

“I want to remind everyone why we’re here today”

Commissioner Bryan Eastman said, “This is gonna hurt because our property insurance is going up… GRU rates ain’t coming down any time soon, internet bills are some of the highest in the state. And I want to remind everyone why we’re here today. It was because of that $19 million that we have now cut… that our Mayor and City Manager and GRU General Manager were brought before the legislature, and they said you need to raise taxes–very explicitly, you need to raise taxes–and you need to cut money from Gainesville Regional Utilities.

“Well, [what] we didn’t know then, but we now know, was that they were soon going to be taking that utility from the people of the city of Gainesville and holding it for themselves. And we’re now in a position where we have cut a lot. We’ve cut 75 positions from our budget, with 27 filled. And we’re essentially subsidizing the Gainesville Regional Utilities Authority, as well as the high bills that we’re paying to the Gainesville Regional Utilities Authority.”

Eastman said a consultant estimated in 2021 that GRU would pay about $26 million in property taxes and franchise fees if it were a private business, about $11 million more than the Government Services Contribution GRU is set to pay to General Government next year.

Eastman added, “And it is my hope that when this new Authority comes in, they will say that they want to pay their fair share in taxes to the City of Gainesville. And if they do that, I would really like to be back here next year and dropping this tax bill right back down to the 5.5 mills where we’re at today. I don’t know if they’re going to do that. I am skeptical that they will do that. But I think that would be a good showing.” He encouraged residents to ask the Authority to pay “what their fair share of taxes are so that we are no longer subsidizing them.”

Eastman said he wanted “to be a part of the solution [for rising prices and rents]. And today I feel like my hand is being forced into not being part of that solution.” He said he hoped they could reduce the property tax rates next year, “but it’s not up to us. It’s up to whoever Ron DeSantis appoints to this new Gainesville Regional Utilities Authority.”

“We have pivoted from thinking about our biggest, greatest, grandest dreams in Gainesville to what we have to do to survive”

Commissioner Casey Willits wanted people to think about the “human beings that will be losing their jobs on October 1… Those employees have families and car payments and mortgages and cheerleading camp payments due… In these five months, we have pivoted from thinking about our biggest, greatest, grandest dreams in Gainesville to what we have to do to survive, yet still provide the services that people expect and to stay true to our values and stay true to our neighbors and do right by them.” He added that people who live in apartments will be hit harder by the property tax increases because those properties don’t have homestead exemptions or Save Our Homes protection.

Commissioner Cynthia Chestnut made a motion to set the millage rate for FY24 at 6.4297 mills, and Eastman seconded the motion. The vote to approve the motion was unanimous, with Commissioner Reina Saco absent (she missed the full day).

Following the vote, Ward thanked the City Manager and City staff for their work on the budget.

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