Alachua holds line on taxes

Despite a gloomy economy’s impact on the local real estate market and property tax revenues, the City of Alachua approved a plan Monday that would hold down tax rates.

The commission unanimously approved a resolution preliminarily setting the property tax rate at 5.5000 mills.  Ad valorem taxes, or property taxes, are just one form of revenue used to fund the City’s roughly $39 million budget.  The property taxes are specifically placed in the City’s general fund, which typically hovers around $9 million annually.

By keeping the millage rate at 5.5000 mills, City of Alachua Finance Director Marcian Brown said the City could expect to take in $368,582 less in the coming fiscal year, which begins Oct. 1.

Commissioner Gary Hardacre noted that even though the proposed 2011/12 millage rate is the same as the 2010/11 rate, residents should know they’ll likely pay less.

“Even though we left it at 5.5 mills, for most of our citizens of Alachua, their tax will be lower than it was last year,” he said.

For homeowners, Brown said the savings on a $200,000 home would be about $104 or on a $50,000 home, a savings of $26.

City Manager Traci Cain hasn’t finalized or presented her proposed budget to the commission, but setting the millage at 5.5000 is a sign that the budget will likely see cuts over the previous year.

Mayor Gib Coerper lauded Cain and her staff, but commented on how the cuts have impacted certain areas of the budgets.

“I appreciate the staff’s hard work on this,” he said.  “I have to say ouch, because it’s been tough…on our capital improvements budget.”

Vice-Mayor Ben Boukari, Jr. also commended Cain and the city staff, saying, “In my opinion, this is a good direction to go, and not raise [taxes], but look for ways to cut and trim fat.”

The reduced millage comes in the face of some increases, like an estimated $157,000 hike in the cost of fire services.  Although the City took advantage of a promise by Alachua County to offer fire and rescue services at $475,000 last year, that option is no longer available.

This year, the City and Alachua County Board of County Commissioners have already agreed to use a traditional funding formula to determine the City’s portion of fire services.  The total of those costs is estimated to come in at $632,496 in the 2011/12 fiscal year.