Lake Wales Property Tax Rate Raised by One Mill

The first ad valorum tax rate increase in nearly a decade was approved by the Lake Wales city commission on first reading Wednesday.

The new property tax hike of 16.34 percent will contribute to the city's $99.5 million budget for fiscal year 2022-2023, which begins October 1.

For many years in a row, Lake Wales commissions have simply adopted the "roll-back" rate, which was the rate which would generate the same revenue year after year, while the rate fell. That steady erosion, however, did not account for the natural growth in expenses, leaving the city with a tightening budget, according to a staff report.

The budget was reviewed in a workshop session, but no one from the public addressed the commission during the meeting, which apparently required pre-registration. The 4-0 vote was conducted in the absence of Deputy Mayor Robin Gibson. A second vote will follow in two weeks.

The change in tax rate will generate an additional $856,225, less than half of the $1,813,360 new revenue contributing to the city's overall budget. Much of the additional revenue will be spent on an increase in public safety expenditures of $1,447,452, including $577,266 for police and an additional $784,374 for the fire department. Another $612,114 will go toward the Parks Department, including $495,008 for personnel and $108,206 operating supplies.

The Lake Wales Connected program is not included in the city budget, as it is being paid for by the Lake Wales Community Redevelopment Agency, which has bonded a dedicated revenue stream to fund that expansive street reconstruction project. Other streets outside the program are subject to a $500,000 resurfacing fund, a number which has been reduced in some recent budget years, contributing to a maintenance backlog.

"As of September 30, 2022, the City's governmental funds reported combined ending fund balances of $10,407,370, a decrease of $251,572 for the year," according to a memo prepared by City Finance Director Dorothy Abbott. At the same time, however, reserves have grown well beyond targets set in 2011, when the city encountered a financial crunch.

According to Abbott's report, "in 2011, the City established a reserve policy for the General Fund equal to 15% - 20% of total operating costs. As of September 30, 2022, the general fund's unassigned fund balance represented 25% of total general fund expenditures, while total fund balance represents 35% of the same amount."

Staffing of the former Family YMCA and Kirkland Gymnasium is another new expense faced by the city. The city-owned facilities have been managed by the YMCA of West Central Florida, which abruptly cancelled their management contract, leaving the city with few options. Determined to keep them open, commissioners have backed City Manager James Slaton's plans to hire new staff at an annual cost of $728,000.

Other expenses for the operation of recreation facilities bring that total to $849,292, a figure which commissioners hope to offset with $400,000 in revenues from memberships to the rebranded Lake Wales Recreation Center.

The city is engaged in a several infrastructure projects, many partially or wholly funded by grants. They include new water and sewer lines, Jet A and 100L facilities at the airport fuel farm, reroofing of the city administration building, repairs at the History Museum, and improvements to the Public Library.

The interim millage rate of 7.1214 was included in the recently-mailed TRIM notices to property owners. That "Truth in Millage" statement recounts all the various charges and fees levied by governments, including, city, county, school board, water management districts, and any special taxing or services districts that may apply to a particular property. By adopting the budget and rate resolutions, the commission is locking that increase in the future assessment, which will be payable starting in October.

The new property tax revenue will add to other growing revenue streams, including $80,000 in sales and use taxes mainly due to an increase in utilities taxes. Other funds will come from increases in licenses and permits of $90,000, intergovernmental revenues of $227,264, $123,000 from the half-cent city share of sales tax, and $85,000 in grants increases. An increase in transfers from the Utility Fund of $142,478, revenue generated by the sale of water, will also contribute.