The Marathon City Council is proposing a small property tax hike for the 2012-13 fiscal year, which begins in October.
At its first budget workshop last week, the council voted unanimously to set the tax rate at 2.198 mills, which would amount to $219 per $100,000 of taxable property value.
The rate hike would add an extra $220,000 to the city coffers, officials forecast.
Marathon Finance Director Peter Rosasco opened last Thursday's meeting at the city fire house with better news.
"We're seeing a stabilization in property values," he said. "It's not the 10 percent or 20 percent decreases that we've seen in years past."
The rollback rate -- the tax rate that would collect the same amount in property taxes that the city collected this fiscal year -- is 2.051, or $205 per $100,000 of value. Typically, a tentative millage rate is set at the first budget workshop and pared down at future meetings.
The next budget workshop will be at 5 p.m. Thursday, July 26, at the firehouse. The public budget hearings are set for Sept. 11 and Sept. 25.
Financially, the city faced two serious setbacks in the 2011-12 fiscal year. First, it had to pay $2 million to settle a lawsuit brought by Boot Key property owners over the removal of the bridge. (Insurance through the Florida League of Cities covered another $1 million.) The second was lower-than-projected building fee revenue. The city estimated that it would collect $775,000 in fees but now expects approximately $445,000. The 2012-13 forecast for building fees is somewhere in the middle -- $670,000.
In addition, the city is upping its participation in the Key West shuttle service, public transportation operated jointly by the county and Key West, from $68,000 to $120,000.
"We tried to be conservative with this budget," Rosasco said. "We're not out of the woods. The economy is still tight."
Next year's proposed budget has some positive notes. The city expects to collect an extra $150,000 from the half-cent sales tax, bringing the total to $1.3 million. It also expects to collect $98,000 in extra revenue from the Federal Emergency Management Agency and Fish and Wildlife Conservation Commission review and processing fees.
Those new monies are tied to a recent requirement that Keys building permits be reviewed to assess potential impacts on nine endangered species.
Rosasco also gave city Fire Chief John Johnson kudos for improving the collection of EMS service fees. Next year, the city hopes to realize $425,000 in services, up $50,000 over this year.
Also included in the proposed budget is a bonus for full-time city employees who have not been hired or promoted during the last six months. The bonus amounts to 3 percent of all salaries, but amounts will be divided at the discretion of department bosses.
Other planned expenditures for 2012-13 include Fourth of July fireworks ($24,500), grants to non-profits ($90,000) and summer camp activities ($37,300).
The city also made some staff reductions. It eliminated the director of community service position and the emergency management coordinator. Also, expenses were shifted between departments -- parks and recreation employees were moved to the public works department and some employees from the planning department were moved to the building and code department.
If the proposed property tax rate is approved at subsequent meetings, the city can expect to collect $3.7 million in taxes next year. Factoring in revenue, that will leave the general fund at $10.8 million, with $8.8 million in expenses and about $2 million in savings.
"Our tax rate is lower than what Monroe County charged homeowners living in unincorporated areas last year. We're also lower than Key Colony Beach. I think we've given the council a very good budget," said City Manager Roger Hernstadt.