Fort Walton Beach Council agenda — 06-03-08 workshop agenda — reading text

it would be necessary to collect the 3 of 4 assessment via separate mailing since the January 1 deadline for including the assessment on the 2008 property tax bill has passed. FY 2009 -10 — Adopt the necessary ordinance and /or resolution( s) to include the fire protection services assessment on the 2009 property tax bill at a public hearing prior to January 1, 2009. The property tax bill is the preferred method of collection and would be used in FY 2009 -10 onward. Staff is awaiting the City Attorney's opinion on possibly using the utility billing method of collection for FY 2008 -09 and will obtain the City Attorney' s guidance on how to transition to the property tax bill method of collection for FY 2009 -10. Recommendation Staff respectfully requests City Council consensus to move forward with a Resolution of Intent to implement a fire protection services assessment. Attachment: FAA' s: Fire Protection Services Charge Concur Do not concur Hold for discussion Ayce Shan han City Manager u: \budget \budget 08 -09 \fire fee workshop \6 -3 agenda staff report.doc 4 of 4 FREQUENTLY ASKED QUESTIONS: FIRE PROTECTION SERVICES CHARGE The Fort Walton Beach Fire Department responds to calls of service for fire related issues every day. These responders go to residential structures, businesses, industrial, and institutional establishments throughout the City. The common factor is that all of these calls for service receive assistance from the fire department. The uncommon factor is in how much each recipient of service pays for fire service response. Why is the Fire protection services charge being proposed? The Fire protection services charge is being proposed as an option for funding the Fire Department for 2 reasons. A. To provide a fair and equitable method of funding essential services that is not based on taxable value but on actual cost of service. B. To provide a non property tax based dedicated funding source for the essential service of Fire Protection. Why is a Fire protection services charge fair? A Fire protection services charge is a flat fee for fire service to each property in Fort Walton Beach. The flat fee is based upon the number of emergency responses by the Fire Department to various property types. Those that use more service pay more. Why not use Ad Valorem tax? The simple answer as a taxpayer... is it fair that single family homes on the same street with approximately the same market value are paying different amounts for the same fire protection? When using ad valorem taxes property owners pay for the same service based upon taxable value which is affected by when a property is purchased and exemptions such as homestead. A Fire protection services charge would apportion the cost of services equally among similar property types based on their respective use of fire services. Currently, approximately 15% of the City's property tax revenue is allocated to the fire department. Approximately 86% of the fire department' s $ 3M budget is attributable to fire protection services. Any or all of the expense could be funded from a fire protection services charge. Does the enactment of the assessment mean an automatic reduction in my tax bill? No. Property tax reform passed by the Florida Legislature in June 2007 required that the City' s FY08 millage rate not exceed 95% of the roll -back rate and provides for future caps on ad valorem revenue to not exceed the rollback adjusted by the percentage change in personal income if passed by a simple majority of the governing body property tax. A Fire protection services charge would enable the department to continue to provide its current level of fire services and programs, while fairly apportioning the cost between the recipients of fire services rather than burdening only ad valorem taxpayers in proportion to the value of their property. Why can only 86% of the Fire Department budget be funded through a Fire protection services charge? The courts have ruled that all expenditures associated with emergency medical services in a municipal fire department' s budget cannot be collected under a fire protection services charge so long as the County provides emergency medical services. Staff has determined that 14% of our budget is allocated to emergency medical services. 1 of 2 Why can' t Emergency Medical Services be funded? This court ruling came out as a result of the business community suing a city that instituted a Fire /EMS fee where all services were taken into consideration. The courts ruled that EMS is not property specific. Cities may charge a fire protection services charge for fire services ( which benefit property) but not for emergency medical services ( which benefit people). The benefits of fire services include protecting the value of structures and improvements and lowering the cost of fire insurance through the presence of a professional and comprehensive City fire program. Can the Fire protection services charge be used to fund parks, roads, or other projects? No. The monies must solely be used to fund the fire protection services. Can the Police Department be funded by a similar fee? To our knowledge there is no court ruling that has upheld the use of fees or assessments to fund police services. Based upon court challenges and the correlation between the use of assessments to specific property types, it is unlikely that police services would or could use assessments as a funding source. This is very similar to the emergency medical services issue. Why is staff bringing forth a possible Fire protection services charge now? Staff first began evaluating a fire protection services charge in 2002 in conjunction with the expansion of Fire Department services from basic life support to non -transport advanced life support. As mentioned earlier, a fire protection services charge can only fund services that benefit property ( fire) and not services that benefit people ( emergency medical). However, collection of a fee for fire services would free ad valorem and other General Fund revenues to fund expansion of emergency medical services. Due to appreciation in property values, the City has thus far been able to fund this expanded service level without increasing the millage rate or reducing service levels elsewhere in the General Fund. As the City begins the process of developing the FY 2008 -09 budget in an environment of reduced state shared revenues and property tax reform, staff believes it is prudent to again evaluate the feasibility of a fire protection services charge. During last year' s special state legislative sessions there was discussion of not allowing cities to create an alternative revenue source as a funding mechanism to offset potential losses in ad valorem revenues due to property tax reform. Having this option available, even if only funding a portion of eligible expenses, would provide greater flexibility to City Council during budget deliberations. What is the bottom line concerning the Fire protection services charge? In the current atmosphere of tax reform and concern over fairness in taxation, the use of a Fire protection services charge offers an alternative. The fee would be uniform for similar types of property and based on service usage. A tiered Fire protection services charge is the fairest apportionment method relative to property size, property type, and fire services demand. The fee would be levied based on equivalent residential unit or non -residential square footage. The present system of ad valorem tax apportions the cost of services based on the taxable value of property and continues the current method of similar market value properties paying different amounts for the same services. The Fire protection services charge is being presented for City Council consideration as a mechanism of fairly funding a portion of fire protection services. 2 of 2 s v 0 0 a, a v 0 OMH o c o v LL, , O O O 1 do i n W i, r VJ\ W O r O 1) EZ7 Cu v  V)V) NN 4--4-- JJ( ( ff ii UU O OO a Q) Q)Q) U MM ruru LnLn V) I uu Q) OO Ln LL 7070 L 0) Q V)V) Lo O 1) L Q) W C) L roro LL soso Q) W... W... Q)Q) 0 L.L. QQ Q. OO Q)Q) ruru Q)Q) a E 0 4-J CLCL oo Q)Q) J U QQ UU QQ J Q) LL U 00 U