Apalachicola taxpayers are likely to see a decrease in property tax millage, but an increase in the water rates, in the next fiscal year.
While city commissioners have two 5 p.m. public workshops, Aug. 13 and 27, to hammer it out, City Manager Ron Nalley’s budget, unveiled in detail Tuesday evening, calls for a drop in the millage rate from 9.6043 to 9.3 mills, which is just slightly above the rollback rate of 9.2813 mills.
Because of a growth in the tax base of about 8.1 percent, the proposed budget is expected to bring in about $1.4 million, about 4.7 percent more than last year’s ad valorem taxes of $1.33 million.
The overall budget will be about $7.1 million, but that includes both enterprise funds, such as water and sewer, roughly $2.2 million, that must pay for themselves, and the general fund, which will run about $4.4 million.
Nalley said sales taxes and utilities franchise taxes would remain the same, together about $300,000 in revenue, with the municipal utility tax brining in about $200,000.
Health insurance costs are expected to decrease for next year, while the rate required to pay into the Florida Retirement System is set to increase.
The city manager proposed a 2 percent cost of living increase to all city employees, and seeks to add a full-time position in planning and zoning, that would replace the service contract that City Planner Cindy Clark works under, until she steps down from that post at the Oct. 1 start of the new fiscal year.
Nalley is proposing no change to the sewer user fee, but a water rate hike of 10 percent, which he said is consistent with a recommendation by the Florida Rural Water Association.
In his report, he noted that nearly $580,000 in annual payments on the sewer debt, and about $200,000 on the water debt, are a major reason for this increase.
He also outlined several successes in his first year as city manager. His contract is up for an annual review, to be scheduled in the next several weeks. Commissioners also voted unanimously to approve the creation of a committee to address the hiring of a new city attorney.
Nalley said last year’s bank balance for the city was $14,000 and now stands at about $526,000. He said there have been no delinquent payments on the multi-million dollar debt to the Florida Department of Environmental Protection, unlike four missed payments last year.
He said the debt default has been whittled down from nearly $755,000 in 2018 to just under $700,000. The issue of the precise amount of the defalut amount has become an issue in the mayoral race, with a dispute over the precise amount.
Nalley said because of the formula DEP uses to apply payments, it will be some time before the city is out of default, even though it makes regular payments to retire debt. In this current fiscal year, the city will have spent about $870,000 towards payments on the the water and sewer debts.
He said that since 2018 the administration has saved $530,000 and has reinvested it in the current budget. The number of city employees has dropped from 33 to 29, Nalley said, all through attrition and not through firings.
He also stressed that the city’s levels of TTHM, the chlorination product that can be harmful to human health, has decreased from 108.4 to 87.2, and will further drop with the addition of a new filtration system, funded through a $1.2 million grant, and $474,000 low-interest loan, secured though DEP.