Fort Myers Beach Council approves preliminary budget with 30% millage rate increase

Board has until hearings in September to make changes

The Town of Fort Myers Beach Council voted Monday to approve a preliminary budget with a maximum millage rate hike of 30%, up from 1.0294 mills to 1.34 mills.

The vote passed 4-1 with Councilmember John King opposed. Voting in favor were Mayor Dan Allers, Vice Mayor Scott Safford, Councilmember Rebecca Link and Councilmember John McLean.

The Town of Fort Myers Beach Council still has time to lower its budget.

The 1.34 mills equates to $1.34 per thousand dollars of a property’s tax value in the the town.

Allers said he was approving the preliminary budget “with the hopes we can get that number significantly lower.”

The town’s preliminary budget increases total spending from $56.08 million to $57.16 million, or a total of $1.077 million more.

Monday’s budget presentation was made by the town’s Assistant Finance Director Jeffrey Newman. Former Town of Fort Myers Beach Finance Director Joe Onzick retired in June, one year after he returned to the town after departing a few months earlier.

The median home value on Fort Myers Beach is $549,796. That means the average homeowner on Fort Myers Beach would see their town tax bill go up from approximately $566 to $737 under the proposed increase, not counting any homestead exemptions.

Newman’s presentation did not explicitly mention that the increase in the millage rate would amount to a 30% proposed increase of the millage rate for Fort Myers Beach homeowners. Instead, the presentation provided a figure that compared the millage rate increase to the overall percentage of a homeowner’s property tax bill for all taxing districts. The presentation had the overall effect of downplaying the overall impact to a homeowner’s property tax bill by stating that the town only accounts for 7.66% of millage collected.

Newman told the Town Council initially that about $6 million was left out of the $11.9 million bridge loan that Gov. Ron DeSantis approved for the town after Hurricane Ian and which needs to be paid back. After Allers said he thought there is less available than that, Newman said there was actually more. Newman said there was about $7.5 million left in the bridge loan fund.

“That doesn’t seem right,” Aller said. His recollection was that less funds were available from that loan.

Town of Fort Myers Beach Manager Will McKannay said the budget he put together a budget that is intended to replenish emergency reserves and put aside funding for a study on dredging.

McKannay said he plans to introduce new fees to raise revenue.

There was no apparent mention in the presentation, nor discussion by the council of what impact the homestead exemption referendum would have on the town’s budget projections. If approved in November, the exemption for property owners homesteaded on Fort Myers Beach would go up from up to $50,000 of their property tax value to up to $150,000 next year, and then up to $250,000 in the year after that.

King said the state is going to mandate the town reduce spending by 10% next year, so wants the town to look at reducing spending more. King said he will be meeting with staff privately to discuss the matter.

King said he had outstanding questions about the budget projections going back to a letter from McKannay to town councilmembers on July 15 regarding budget projections.

According to the letter from McKannay, the town is facing ongoing projected revenue loss related to prior hurricane impacts that total $629,030. McKannay intends to use the bridge loan to cover those losses.

Based on an increase in the town’s property tax values, the town will be seeing an estimated $342,382 in tax revenues based on the current millage rate.

Increased spending on contracted services and personnel costs are also driving the preliminary millage rate increase.

The town is forecasting to use approximately $1 million less of the bridge loan this year than last year.

According to the July 15 letter from McKannay, there would be a $905,375 increase in contracted services for beach management in the next fiscal year. There would another $100,600 increase in contracted services for stormwater management.

McLean said he expects the town to find more cost reductions before scheduled budget hearings in September.

Last year, the Town Council raised its millage rate by 4% to 1.0294 mills after earlier projecting a higher millage rate.

The Town Council set public budget hearings for Sept. 9 and Sept. 23 to finalize its spending plan. The town can still lower its millage rate by those dates.

Fort Myers Beach Observer Editor Nathan Mayberg can be reached at NMayberg@breezenewspapers.com