Fort Myers Beach Council approves tentative 26% millage rate hike
The Town of Fort Myers Beach Council has approved a tentative millage rate hike that will increase the town’s millage rate from .99 mills per thousand dollars of assessed property value to 1.255 mills per thousand dollars of taxable property value, an increase of approximately 26% though the town still has a little more than a month to change course through budget discussions.
The council voted 4-1 Monday on the tentative millage rate increase. Town Councilmember John King was the lone vote against the tentative millage rate hike. The town has scheduled budget hearings for Sept. 11 and Sept. 24 at the new town hall chambers at 5:01 p.m. The council could still vote to enact a lower millage rate in September though not a rate higher than the one voted on Monday during a meeting held at the DiamondHead Beach Resort.
Vice Mayor Jim Atterholt questioned Finance Director Joe Onzick on where the revenue shortfalls were coming from causing the tax hike.
Onzick, who just recently returned to the town after leaving in April, said that while the town is seeing higher revenue in this year’s budget due to higher property tax values, the town’s parking revenue, sales tax numbers and code enforcement revenue have not yet returned to the numbers seen before Hurricane Ian. The town has also seen greater expenses such as liability insurance, health insurance and other projects.
Onzick said the millage rate hike will cover a $1.4 million revenue shortfall.
Since Hurricane Ian, the town has been using part of an $11.9 million bridge loan that Gov. Ron DeSantis approved in 2023 to make up for lost revenues. The loan has to be repaid by 2033 at 10% interest. Town leaders have hoped that the governor or the state legislature could act to forgive the loan but that has not happened.
“That optimism diminishes each year,” Atterholt said.
Mayor Dan Allers, who went to Tallahassee this year to lobby state legislators for assistance, said he was told by state legislators not to ask for loan forgiveness. “We were pretty much told ‘don’t.'”
Allers and Atterholt said the town has to plan for the loan to not be forgiven.
Onzick said the town also used about $800,000 in American Recovery Plan Act funds last year to help balance its budget which it won’t be able to draw upon this year.
Atterholt said the town needs to get its “fiscal house in order.”
Allers said the number of town employees today is less today than before Hurricane Ian.
Atterholt pressed Onzick for more specificity regarding what other increased expenses and shortfalls in revenue were driving the large increase in the tentative millage rate. Onzick is expected to return to the town council on Thursday at a management and planning session to give councilmembers more details about expenses and revenue projections.
King called the budget projections “disheartening.” King called for the town to find more revenue streams through its visitors to help residents.
King said he goes to Maui each year and gets “jacked” by local charges.
Asked why he voted against the increase in the millage rate, King said “I do not believe we should be increasing taxes on property owners and businesses still suffering from the devastating effects of Hurricane Ian. Even without the millage rate increase, the Town will see an increase in ad valorem taxes. The Town has been bailed out since Ian. Who is bailing out taxpayers?”
Among some of the town’s pending increased expenses that are not even in the budget is a matching $1.2 million state grant the town received from the state in this year’s budget to make repairs at one of its water towers, repair road infrastructure and drainage repairs. The town has to spend $1.2 million to gain the $1.2 million.
According to Onzick, the state appropriation grants, and the town’s match are not yet in the budget. “The funding sources of the town’s match are not General Fund revenues. Therefore, the matching requirements have no impact whatsoever on the General Fund deficit. We will be using savings, the specific sources of which have not yet been finalized,” Onzick said in a statement in response to questions from the Fort Myers Beach Observer.
Councilmember Scott Safford said that the town’s fiscal situation has come to a head after not raising taxes the last three years. Safford said he and members of the town’s Audit Committee have been surprised the town didn’t raise taxes the last three years.
Safford said the town needs to ensure it has enough reserves in the case of another hurricane. He said the town also has to plan to save for canal dredging in the future.
Safford said he thinks the town also needs to look at the operations of its mooring field, which he said was losing the town money.
The Lee County Property Appraiser’s Office announced earlier this summer that property values in Fort Myers Beach rose 12% last year, which Safford has said he was expecting to be met by a similar amount of an increase in taxes on Fort Myers Beach.
Lee County Property Appraiser Matt Caldwell has also cautioned that property values could change this year and potentially decrease in some cases based on the real estate market.
Allers said he expects the town council to have more discussions on the budget at a Thursday work session. Allers said he expects the budget will be “refined to ensure we’re funding priorities while being mindful of the tax burden on residents. I anticipate some adjustments as we receive updated figures. Those changes could help reduce the potential for an increase before final adoption, but our focus will remain on maintaining essential services and supporting ongoing recovery.”
To reach Nathan Mayberg, please email nmayberg@breezenewspapers.com