St. Pete has $10 million budget gap, may charge fire service fee to close it

07/11/12 Janelle Irwin
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St. Pete City Council is considering whether to impose a fee on properties to pay for the city’s fire services. On Thursday, council will vote on whether to implement the suggestion proposed by Mayor Bill Foster in order to avoid cutting city services. City Council member Steve Kornell voted against the measure on first reading in June, but it advanced anyway.

“It bothered me – especially as a social worker – that now we’re going to say this is a fair way to do it because grandma who lives on $800 a month of Social Security now is going to pay a little bit into the system. Well, I don’t want grandma who’s living on $800 a month Social Security to pay into the system. I’d rather pay a little extra myself.”

Critics have called the Fire Readiness Fee a regressive tax because it imposes a flat fee on all properties regardless of the value.

“What would happen is, if you’re an individual person that owns a small home, you’re assessed the five dollars a month and if you’re Wal-Mart that owns a big huge store, you’re assessed the five dollars a month.”

Kornell used $5 as an example, but that amount is more likely to fall around $60-75. The plan also includes a provision that would impose up to 24 cents per $1,000 of assessed value.

”The other portion of the fire fee is based on the value of the buildings on the land. So then that’s a variable portion. So then, if you’re Wal-Mart your fee would be a lot more than an individual homeowner’s would be. That portion of your fee would go up more.”

Kornell said he has no plans to vote for the fee. Council member Wengay Newton also voted against it on first reading. Five members voted for it with Charlie Gerdes being absent. Six council members – the number needed to pass the Fire Readiness Fee on second reading – have already voted yes on a related measure.

“We voted to pay the attorneys to pay the attorneys $60,000 – up to $60,000 – to set up the process for doing the fee before we voted to approve the fee and it requires six votes. I said at that time, ‘I’m a no-vote, I’m not going to change my mind. If anyone else thinks they might change their mind they should say that now before we spend $60,000 setting up a fee that might not even get approved.”

And even though Kornell expects to hear from some residents against imposing any extra fees, not everyone is looking at it as a bad thing. Darden Rice, president of the St. Pete area League of Women Voters, is working on what’s called the People’s Budget Review. She said so far, citizens who have taken the online survey outlining what priorities the Mayor and City Council should put into the budget have said they don’t want any more city services cut.

“What a positive place that we’ve gotten to where the city is actually debating revenue and that Mayor Foster’s budget completely reflects an understanding that the citizens don’t want more services cut – that we need to look at cost savings, that we need to look at efficiencies and that we need to look at long-term sustainability.”

Even though most of city council seems poised to pass the Fire Readiness Fee, the Mayor does have a backup plan. If the fee doesn’t pass, Mayor Foster plans to seek a property tax hike of one mil, or $1 for every $1,000 of assessed value. That plan would arguably spread the tax burden more fairly over those most able to pay it. Rice called the difference between a fee and a tax a phony debate.

“I think that the debate over whether we call it Fire Readiness fee or a millage rate increase – I mean either way, we’re looking at ways to bring in revenue and whether you call it a fee or call it a tax the difference I think is really minimal.”

Rice said there is an argument to support either the Fire Readiness Fee or the millage rate increase.

“So, there’s pluses and minuses to both and I think we’re going to still continue to see people make the argument that maybe neither is adequate, that we need to look into reserves. So, all those debates right now are playing themselves out.”

The Mayor’s budget proposal does include about $2 million in cuts, but most of them are efficiencies due to consolidating services between departments. St. Pete needs about $10 million in revenue to avoid any further cuts. Either the Fire Readiness Fee or a millage rate increase would cover the shortfall.

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