Submitted By: Tammi Haslam
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Presentation By: Tammi Haslam
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Department: Budget
STAFF RECOMMENDATION (Motion Ready):
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Adopt the Fiscal Year 2024-25 tentative millage rates: Basic City - 6.6177; District A - 1.7185; District B - 1.6332; District C - 1.4699
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OCALA’S RELEVANT STRATEGIC GOALS:
Fiscally Sustainable
PROOF OF PUBLICATION:
N/A
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BACKGROUND:
Tentative Millage Rates
As required by the State of Florida Department of Revenue, the City must provide its tentative millage rates, rolled-back rates, and the date, time, and place of its budget public hearings to the Marion County Property Appraiser no later than August 4, 2024. To do so, we request that City Council agree on tentative millage rates at the July 16, 2024, meeting. Once the tentative millage rates are set, the tax rates can be held constant or reduced. They cannot be increased.
The tentative millage rate is used to calculate taxes based on the assessed value of real property. One mill of tax is equal to $1 for each $1,000 of property value. The level of increase is calculated using the rolled-back rate as the base. The rolled-back rate is the millage rate that will provide the same property tax levy as was levied during the previous fiscal year, except for levies on new construction, additions to structures, deletions, and property added due to geographic boundary changes.
FINDINGS AND CONCLUSIONS:
When setting the tentative millage rates, Council should consider:
1. The rolled-back rate is the amount of millage necessary to raise the same amount of Ad Valorem tax revenue as the previous year, excluding taxes from new construction, and may be adopted by a majority vote of City Council.
2. The adjusted rolled-back rate which includes the change in per capita Florida personal income (1.0569 for Fiscal Year 2024) may be adopted by a majority vote of the City Council.
3. The maximum millage rate allowed with a two-thirds vote of City Council is computed at a rate of 110 percent of the adjusted rolled-back rate.
4. A millage rate greater than 110 percent of the adjusted rolled-back rate requires the unanimous vote of City Council or a referendum.
Basic City Millage Rate
Based on the July 1 Certification of Taxable Values received from the Marion County Property Appraiser, the current year's gross taxable value for operating purposes is $7,789,566,208. It reflects a 10.39 percent increase compared to the prior year’s gross taxable value of $7,056,542,680.
For comparison purposes, the following schedule provides the current, rolled-back, and maximum millage rates that can be imposed with a majority vote or two-thirds vote of City Council and the amount of revenue generated for each, based on a 95 percent collection rate.
|
FY25 Rates |
% Incr/Decr Over RBR |
Comments |
Vote |
FY25 Proposed Revenue @ 95% |
FY24 Actual Revenue @ 95% |
Incr/Decr Over FY24 Revenue @ 95% |
|
6.6177 |
5.04% |
Current Rate FY24 |
Majority |
$48,971,562 |
$44,363,178 |
$4,608,383 |
|
6.9017 |
9.54% |
Majority Vote Max |
Majority |
$51,073,187 |
$44,363,178 |
$6,710,008 |
|
6.3004 |
0.00% |
Rolled-back Rate |
Majority |
$46,623,514 |
$44,363,178 |
$2,260,335 |
|
7.5919 |
20.50% |
2/3rd Vote Max |
2/3rd Vote |
$56,180,727 |
$44,363,178 |
$11,817,549 |
The schedule below uses the millage rates above to provide an estimate of the amount of city property taxes that a property owner would pay for each rate, assuming the assessed value is $150,000 less a $50,000 deduction for homestead exemption.
|
Taxable Value* |
FY25 Rates |
City Tax |
FY24 Rates |
City Tax |
Incr/Decr over FY24 Tax |
|
$100,000 |
6.6177 |
$662 |
6.6177 |
$662 |
$0 |
|
$100,000 |
6.9017 |
$690 |
6.6177 |
$662 |
$28 |
|
$100,000 |
6.3004 |
$630 |
6.6177 |
$662 |
($32) |
|
$100,000 |
7.5919 |
$759 |
6.6177 |
$662 |
$97 |
Downtown Development Districts
The Fiscal Year 2024-25 taxable values, current millage rates, rolled-back rates, maximum millage rates allowed with a majority vote, maximum millage rates allowed with a two-thirds vote, and the revenue generated for each rate for the three Downtown Districts are shown below for comparison purposes. Districts A, B, and C reflect increases of 8.32 percent, 15.59 percent, and 7.73 percent respectively over Fiscal Year 2024 taxable values.
|
District |
FY25 Tax Value |
Current Millage |
Revenue at 95% |
Rolled-Back Rate |
Revenue at 95% |
Max Rate Majority Vote |
Revenue at 95% |
Max Rate 2/3 Vote |
Revenue at 95% |
|
District A |
$43,261,569 |
1.7185 |
$70,628 |
1.6423 |
$67,496 |
1.7357 |
$71,335 |
1.9093 |
$78,469 |
|
District B |
$32,226,140 |
1.6332 |
$50,000 |
1.5422 |
$47,214 |
1.6300 |
$49,902 |
1.793 |
$54,892 |
|
District C |
$15,862,884 |
1.4699 |
$22,151 |
1.4273 |
$21,509 |
1.7166 |
$25,869 |
1.8883 |
$28,456 |
Public Hearings
The City’s public hearings must be held in September. Per Truth in Millage (TRIM) requirements, the first hearing cannot be held sooner than September 3 and no later than September 18. The dates proposed for the Fiscal Year 2024-25 public hearings are September 3 and September 11.
The School Board has priority scheduling hearing dates, and the Board of County Commissioners has second. No other taxing authority in the county can use the hearing dates selected by the School Board or Board of County Commissioners.
FISCAL IMPACT:
Per Chapter 200, Florida Statutes the City Council must adopt a tentative millage.
PROCUREMENT REVIEW:
N/A
LEGAL REVIEW:
N/A
ALTERNATIVE:
None