Fort Walton Beach — Fiscal Year 2022-23 Adopted Budget — reading text

2013-14, the City simply did not have room to “do more with less” and raised the millage rate to 5.7697 mills. As property values continue to rise, the City lowered the millage rate to the rolled-back rate of 5.6395 mills in FY 2019-20, lowered it to 5.3293 mills in FY 2020-21, and kept it the same 5.3293 mills in FY 2021-22. The FY 2022-23 proposed budget is predicated on lowering the millage rate to 4.9999 mills; this is the third year (out of four) that City Council has lowered the millage. One mill equals $148.78 per $1,000 of taxable property value. City of Fort Walton Beach, FL 37 Revenues Franchise Fees & Utility Taxes – The City’s franchise fee agreements provide a 6% rate on gross electric and gas sales of utility companies serving Fort Walton Beach. A $1.93 per ton sanitation host fee on garbage collected outside the City limits and brought to the transfer station is also collected per contract. Franchise fees comprise $2.0M, or 7.0%, of revenues and have increased $3.5 1.43% over the previous fiscal year. $3.0 Utility taxes are contractually levied against electric, gas, and water revenues of local utility $2.5 companies at the rate of 10%. Over the past five $2.0 years revenues have steadily increased. This year, Millions $1.5 these revenues are expected to increase by 4.4%. $1.0 A large portion of electric and natural gas utility bills is exempt since the tax on the fuel charge $0.5 component is based on 1973 fuel prices (and $0.0 Franchise Fees Utility Taxes therefore immaterial to a great extent). Utility 2018-19 2019-20 2020-21 Budget Budget taxes are anticipated to generate $3.0M, or 2021-22 2022-23 10.0%, of total revenues. Communication Services Tax – This tax was created in FY 2001-02 as a flat tax rate for all communication services. The Department of Revenue collects the tax from vendors and remits the appropriate amounts to local jurisdictions. The Office of Economic and Demographic Research (EDR) provides revenue estimates for cities and counties. Based on information from EDR, $1.03M is budgeted, which is a 1.0% increase when compared to FY 2021-22. This revenue stream has been declining as more consumers eliminate land lines and service providers bundle taxable services with non-taxable services, thereby eliminating payment of the tax. Half-Cent Sales Tax – This category includes a $4.25 state-shared revenue distribution, derived from $4.00 $3.75 net 6% state sales tax revenue (which is the $3.50 $3.25 $3.00 largest source of revenue sharing for local $2.75 $2.50 governments), as well as a half-cent county- Millions $2.25 $2.00 distributed surtax, implemented by voters in FY $1.75 $1.50 2018-19. Together, this revenue source is $1.25 $1.00 anticipated to generate approximately $4.6M, or $0.75 $0.50 12.6%, of total revenues. The revenue estimate, $0.25 $0.00 also published by the Office of Economic and Communication Services Tax Sales Tax Municipal Revenue Local Option Fuel Sharing Tax Demographic Research (EDR), which has 2018-19 2019-20 2020-21 Budget Budget rebounded as the economy has improved, is 2021-22 2022-23 estimated to increase 23.1%. Municipal Revenue Sharing – This is funded by 81.0% of sales and use tax collections, 19.0% of state alternative fuel user decal collections, and the net collections from the one-cent municipal fuel tax. This revenue estimate is published by the Office of Economic and Demographic Research (EDR), and is budgeted at $1.01M, or 3.5%, of total revenues. The revenue estimate, also published by the Office of Economic and Demographic Research (EDR), which has rebounded as the economy has improved, is estimated to increase 21.7%. Local Option Fuel Tax – These proceeds are allocated via a ten-year interlocal agreement between the county and municipalities based on transportation expenditures. Counties are authorized to levy up to 12 cents of local option fuel taxes in the form of three separate levies. The first is 1 cent; the City does not receive a portion of this. The second is 1 to 6 cents; the County City of Fort Walton Beach, FL 38 Revenues levies the full 6 cents and the City receives 9.7956%. The third is 1 to 5 cents, of which the County currently levies 3 cents. The City’s local option fuel tax proceeds for FY 2022-23 are budgeted at $702K and $295K, respectfully. This revenue source is anticipated to increase on an average of 13.8%. Interfund Transfers – Interfund transfers represent $3.4M, or 6.1%, of total revenues. The Debt Service Fund receives $2.2M from the General Fund for principal and interest payments. The Beal Memorial Cemetery Fund receives $38K from the General Fund (20% of cemetery lot sales) for investment for perpetual care of the cemetery once all lots are sold. The General Fund receives $1.2M from the Utilities Fund and $208K from the Stormwater Fund (6% of water & sewer and stormwater fees) as a franchise/right-of-way access fee and $474K from the Sanitation Fund to compensate for additional roadway wear & tear caused by heavy sanitation trucks. City of Fort Walton Beach, FL 39  Expenditures FY 2021-22 Budgeted Expenditures $56,767,451 Capital Outlay/ Debt Service , Contingencies , $495,230 , Improvement , $4,645,125 , 8.2% 0.9% $6,654,704 , 11.7% Reserves , $1,052,056 , 1.9% Culture & Recreation , Interfund Transfers , $5,518,093 , 9.7% $1,079,616 , 1.9% Economic Environment General Government , , $2,844,768 , 5.0% $4,950,823 , 8.7% Transportation , $605,524 , 1.1% Public Safety , Physical Environment , $14,911,424 , 26.3% $14,010,088 , 24.7% Physical Environment – This category comprises $14.0M, or 24.7% of total expenses and $16 includes cemetery operations and the following $14 enterprise activities: water, sewer, stormwater, $12 recycling, and solid waste. These operations are $10 self-sustaining since cemetery revenues normally exceed expenses and enterprise Millions $8 activities are funded by user fees rather than general revenues such as property taxes. $6 $4 $2 Public Safety – This category includes police, $0 fire, code enforcement, and building inspection