PANAMA CITY — Homeowners on Tuesday won’t know exactly what their property tax bill will be this coming fiscal year, but they will learn the highest tax rate they might be paying.
The Bay County Commission is slated to vote at a budget workshop on the maximum millage rate for the coming fiscal year. It will then be sent out in TRIM notices to homeowners.
County staff has recommended increasing the general fund millage rate from 3.65 mills to 4.65 mills.
The 1 mill increase in the property tax would generate $14 million and is equal to $1 for every $1,000 of taxable value. For the owner of a $150,000 house with a $50,000 homestead exemption, this would add about $100 to the annual bill.
Staff also recommended a 0.0475 increase in the millage rate for the Mosquito Control District, which is about $4.75 a year for the owner of the $150,000 home. Staff also recommended a 0.5 millage increase for the Fire Services Taxing District, which adds up to about $50 a year for the owner of the same home.
Even if the commission votes on these increases Tuesday, they are not yet set in stone. The commission could still lower the rate after public hearings scheduled for September.
It’s been decades since the commission last raised the millage rate.
As property values have decreased during the recession, the county has maintained the same millage rate.
That essentially meant the county’s revenues were declining and people’s property tax bills were going down, said budget officer Ashley Stukey.
The county was able to get by dipping into reserves that built up prior to the recession, he said, but those reserves are nearly depleted.
“We said all along we were going to use the reserves because we did have quite a bit of money when the market went through the roof,” Stukey sad. “As tax value [of properties] began to fall, we began to use cash reserves. That was a prudent thing to do. You don’t want to raise taxes during the recession. But it lasted longer than we expected. Now we have gotten to the point in which we’ve burned the cash reserves, and there are no more cash reserves to get rid of to plug the holes.”
Stukey said if the millage rate wasn’t increased this year, the county’s reserves would be down to nothing.
Inadequate reserves could contribute to a negative credit rating for the county, he said. Credit ratings determine interest rates for bonds and other debt that counties incur.
“Cash reserves plays a prominent role in that” rating, Stukey said.
Besides bolstering reserves, the 1 mill increase is proposed to pay for a 3 percent pay increase for county employees, 30 new patrol cars and nine more detention officers for the jail and $1 million for road resurfacing.
The commission is slated to discuss the budget at 9 a.m. Tuesday at the Bay County Government Building, 840 W. 11th St.