The truth about taxes and fees in Port St. Lucie

Posted: Aug. 5, 2009

Erroneous explanations about Port St. Lucie property taxes have been published recently in the news media and on various Web sites. While the city welcomes public input into the budget process, it is important that citizens have accurate information when formulating opinions.

Because of an $11 million budget shortfall for next year, City Council members are proposing a new property tax rate. The property tax rate also is called the "millage rate."The proposed new rate has been repeatedly mischaracterized and presented out of context, misleading many home owners to believe their taxes are going up by 26 percent for 2010. The truth is Port St. Lucie home owners will not pay 26 percent more in city property taxes for next year, and many will pay less than they did for 2009.

The $11 million budget shortfall occurred because of many economic factors, such as a decline in property tax dollars coming to the city. The decline was caused by a 26 percent fall in local property values this year and a 19 percent fall last year, which resulted in the city losing a substantial amount of income needed to provide public services.

To compensate for the loss, the Council considered using the "rolled-back" millage rate, which would allow the city to bring in the same amount of property tax dollars next year as it did this year. Therefore, on average, home owners would have paid the same amount as this year.

Instead, the Council is proposing to set the millage rate slightly lower than the rolled-back rate, meaning the city will not bring in as much property tax money next year. With the proposed new millage rate, home owners will pay an average of $102 less in Port St. Lucie property tax for 2010 than for 2009.

The decrease in property values generally lowers property tax payments, and the increase in the millage rate allows the city to recover most of that lost income. Still, for 2010, home owners will pay an average of $419 to the city. For 2009 they paid an average of $522, though individual amounts varied depending on each home owner’s homestead exemption status, how long he or she has owned the home and the appraised value of the individual property. Appraised property values are determined by the St. Lucie County Property Appraiser’s office, not by the city.

The City Council lowered the tax rate three times in the last five years, but several other taxing authorities also collect money from each property, and the Council has no control over the amount those agencies charge. Those agencies include St. Lucie County government, the St. Lucie County Fire District, the St. Lucie County School District, the South Florida Water Management District, the Children’s Services Council, the Florida Inland Navigation District and several others.

It’s important to note that only 19 percent of a home owner’s property taxes go to the City of Port St. Lucie. And since the city’s portion of each tax bill equals only 19 percent of the total property taxes charged by all agencies, the amount of money affected by the millage rate increase equals only five percent of a home owner’s tax bill, not 26 percent. The increase would mean higher payments only if property values had remained the same as last year, but values went down, and the combined effect of the decrease in values and the increased millage rate equals a lower payment, on average, for most residents.

In addition to property taxes, which vary according to individual property value, city residents are charged various fees for services that are not paid for by property taxes. Some fees are charged on a fixed-rate basis, others are charged as a percentage. Proposed increases in those fees include:

Fixed-rate fees

Waste Pro trash removal fee—from $253.70 to $262.10 a year. This $8.40-a-year increase was initiated by Waste Pro because of an increase in dumping fees they pay at the St. Lucie County landfill. The county increased fees in response to an increase in charges by the state government, which forced its expenses to the local level.
Storm water drainage fee—from $133 to $138 a year. This $5-a-year increase will be used to maintain the city’s swales and open drainage system. Though the proposed budget calls for a $5 increase, there may be an increase of up to $20, depending on future cost estimates of a massive drainage project under consideration to correct flooding problems on the east side of the city. The cost for the additional project and any future increase to pay for it have not been determined, but Council members have limited any potential fee increase to $20, so the annual fee would go from $133 to $153 if the full $20 increase is needed and approved.
Street lighting fee—from $19 to $23 a year, a $4-a-year increase. This fee is charged only to properties on streets where residents have elected to install street lights.

Percentage-based fees

Water and sewer utility service—a 3 percent increase. For a typical family of three, which uses about 7,000 gallons of water a month, this equals an increase of $35.04 a year, or $2.92 a month.
Communications services tax—from 1.5 percent to 5.22 percent. This is charged as a percentage of bills for consumer services such as cell phones, Internet and cable television. Though state law allows cities to charge as much as 10 percent, the rate was raised to 5.22, which is the statewide average charged by other cities. The dollar amount customers will see changed on their bills will vary according to the services they buy from telecommunications providers.

The total of the fixed-rate fee increases is $17.40. The total of the percentage-based fee increases will vary from household to household, but on average, most properties still are expected to pay less in total taxes and fees to the City of Port St. Lucie for 2010 than for 2009.

And while Port St. Lucie officials fully understand that recent economic troubles throughout the country have caused residents rightly to be concerned about their money, the facts and numbers must be understood in context for the community to work through difficult times. For that reason, the city encourages residents to develop an informed opinion based on facts, not on misleading headlines or blog entries.