County Commission Hikes Taxes Yet Again

Click HERE for Channel 20 Video of the meeting.

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On Tuesday evening, the Palm Beach County Commission voted 4-2 to raise county tax rates 9.3%, on top of a 15% increase last year. TAB had proposed specific cuts of $50M (2.5% of the $4B adopted budget) that would have prevented the hike. We also asked the commissioners to defer the Fire/Rescue raises (4% increase on a $140,000 average compensation – costing $14M in this budget), and to defer some capital spending. Fire/Rescue cuts would not have affected the county-wide millage (it is a separate line item) but would have been an acknowledgement that the public sector union employees are not completely isolated from economic conditions affecting those who pay their salaries.

The commissioners, in a not-very-serious discussion of additional cuts of up to $10M, and a contemptuous disregard for Commissioner Santamaria’s proposal to reduce the county car allowance, moved to a vote with very little discussion. There was consensus that any cuts that would not have a major effect on the taxes paid by for the mythical $200,000 house would be no more than pocket change and beneath their consideration. The fact that more than 60% of taxpayers will be paying more (click here for the Sun-Sentinel analysis) was glossed over by the commissioners – “the people want the services more than they want a tiny tax cut” – to paraphase Commissioner Aaronsen.

We at TAB are not surprised at the outcome, having discussed it with individual commissioners over the last week:

• Commissioner Marcus told us she was pursuing additional cuts of up to $10M, including some from the Sheriff, but did no more than mention it in passing at the hearing.
• Commissioner Abrams explained to us that while he would like to see the deeper TAB cuts implemented, the votes were not there for it and smaller cuts were not worth the pain they would cause.
• Commissioner Santamaria thought some token cuts would be good but did not support anything substantive.
• Commissioner Taylor would not even consider a cut that resulted in a single employee layoff.
• Commissioner Vana is all for reviewing programs next year (she is calling for “contingency audits”), but would also draw the line at layoffs and is vehemently opposed to outsourcing.
• We did not speak with commissioner Aaronson – what would be the point? He made it clear that he thinks the 2.5% TAB cuts would “destroy the county”.

A curious thing occurred at the hearing. While the Sheriff did not attend the 9/14 hearing and there was little participation or discussion regarding PBSO, at this hearing his organization was well represented, with over 20 employees coming to the microphone in support of the Sheriff’s budget.

We believe this was a consequence of TAB discussions with individual commissioners over the last week regarding the BCC rights under Florida statutes to request line item detail from the Sheriff. The reason for this line of inquiry was in response to Bob Weisman’s statement on several occasions that the county can not cut any more from their budget unless the Sheriff makes equivalent reductions. If this were to be asked of the Sheriff, having the line item detail would allow a public analysis of whether additional cuts would indeed compromise public safety. The PBSO budget has grown 80% in 8 years – about 12 times the population growth and 3.5 times the rate of inflation. The Sheriff provides to the county only the detail required by statute – which is not enough to understand the PBSO spending. Both Broward and Martin county Sheriff’s provide much more detail, and TAB believes the BCC should require it of PBSO as well.

At the hearing, John Kazanjian, president of Palm Beach County PBA (the police union) made the following statement:

“I hadn’t planned on being here, neither had my members and fellow employees.” … “But it’s our understanding that the commission and its staff are listening and catering to professional and semi-professional anti-tax groups, little circles of characters who would complain even if they were paying next to nothing in taxes. But these are the same characters who march into government offices demanding services and call 911 when trash gets thrown on their yard”. “I’m here… because We’re tired of them bashing the Sheriff.”

Let’s set the record straight: TAB is neither a professional nor semi-professional anti-tax group. We are a coalition of concerned citizen-taxpayers, worried that excessive spending at all levels of government has begun to compromise our way of life and the American Dream for future generations. We have no sources of funding other than our own pockets, and all our work is a volunteer effort. The 15 or so citizens who spoke on behalf of the TAB proposal were at the meeting on their own dime, paid for their own parking, and took time out of their lives because they are concerned about the future of Palm Beach County.

We appreciate the feelings of the PBA and the non-union PBSO employees who spoke at the meeting, and we congratulate Sheriff Bradshaw and his team for their enthusiasm and commitment to the organization. They are however, all employees of the county, and representing their self interest. That is their right – the first amendment doesn’t stop when you put on a uniform or draw a public paycheck. What everyone needs to consider though, is that it is the private sector that provides the source of wealth from which government draws its funding. It is a bargain that works best when it is balanced. At the current time, the alliance of public officials, their employees, and the public sector unions that provide their funding and political support have distorted the private/public compact. This phenomenon has destroyed California and is wreaking havoc in many other states. In Florida we have not yet reached the tipping point, but the pension time bomb is ticking. The situation can be brought back to balance, but only if all parties are willing to cooperate.

For an excellent article on the subject, see The Trouble with Public Sector Unions in the fall issue of National Affairs.

We in TAB are not “bashing the Sheriff”. Rather, we have a lot of respect for PBSO and the work they do. We are asking only for transparency in the budget process, and an appropriate level of spending. The Sheriff, the Chief Deputy, and the COO have all offered to meet with TAB and discuss the PBSO budget. We thank them and will take them up on the offer in the very near future.

As a closing remark, I would remind the Commissioners that TAB is focused on SPENDING rather than taxes. Now that the tax rate is set until next year, the ad-valorem discussion is over, but the spending discussion will continue. We at TAB plan to continue our look at the budget line items, perhaps drilling down to the next level. We also hope to look beyond the county to the other taxing districts and the cities. Our mission is unchanged – “We are paying the TAB and we are keeping TABs on you.”

Synopsis of 9/14 Budget Hearing

Click HERE for Channel 20 Video of the meeting.

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Palm Beach County held the first of two public hearings on the 2011 Fiscal Budget on 9/14. The county chambers were filled to capacity and many people either watched on monitors in the anterooms on the 6th and 5th floors or in the lobby to the building. People were turned away and those who arrived after discussion had begun were unable to submit cards to speak or have their positions read into the record.

Note for future reference: At all PBC Commission meetings, once discussion has begun on a topic, no further cards may be submitted. This meeting was no exception. The topic for the county budget was IV E 1 and for Fire/Rescue – IV E 4. Many people arrived late and thus were unable to participate.

Most of those who spoke represented groups unhappy about cuts in the budget – primarily cuts to the Cultural Council, Palm Tran, the Drug Farm and the Eagle Academy. Even after the Commissioners made it clear that the Drug Farm and Eagle Academy were the Sheriff’s decision, speakers continued to come forward on it.

Thanks to those on the Palm Beach County Taxpayer Action Board work groups who spoke: Shannon Armstrong, Ed Fulop, Jim Donahue, Karl Dickey, John Parsons, Christina Pearce, Michele Kirk, Sherry Lee and Fred and Iris Scheibl. Carol Hurst also spoke on behalf of the TAB proposal. Also speaking – although not specifically on the TAB proposal was Dionna Hall. There were several other people who did not speak but submitted cards stating that they were in support of the TAB proposal. I’m sorry if I missed anyone who also spoke – I was not taking notes. It was unclear whether the Commissioners had received any phone calls or emails; if they had, they did not acknowledge them.

Many speakers left the long meeting after their 3 minutes, so by the time the Commissioners got to discussion of the budget the chambers were almost empty. To view the commission debate – advance to the 3 hr 8 minute point in the video accessed by clicking: HERE

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Discussion lasted over an hour. The Commission voted 5:1 (Steven Abrams opposed) to keep the 4.75 millage rate as a maximum (as it appeared on the trim notices received by all property owners). Attempts would be made to bring the number down – potentially to 4.72 or 4.70. But the majority of the commissioners out right rejected the TAB proposal of roughly $30M in cuts plus an additional $20M which would be required by PBSO to retain flat millage. The target they gave County Administration was anywhere in the range of $4M ($2M from both PBSO and County) to $15M – all predicated on steep cuts by the Sheriff. It was totally unclear whether any further spending cuts whatsoever would be presented at the next hearing on September 28.

Following is a rough outline of the discussion and questions asked by the Commissioners:

Chairman Aaronson started the debate with a motion that 4.75 millage be made the ceiling. It was seconded and then discussion began.

Commissioner Marcus started going through the TAB proposal, exploring various aspects with Administrator Weisman responding:

1. Blue vs Green pages: All Green pages done; none of the Blue cuts were made.
2. Fire/Rescue: union approached on postponing increases – outright rejection
3. Maintain PBSO cut: PBSO cut or returned revenue in amount of $28M
4. HR programs: outright rejection of any of the Clerk’s suggestions of $1M
5. Cut almost $10M in ad-valorem capital – rejected as necessary
6. Stop or defer $91M in non-ad-valorem capital – rejected since it didn’t affect ad-valorem

Commissioner Marcus pursued capital some more – wasn’t a drop-off expected this year? Response was no – actually this coming year was going to be pretty bad with Max Planck debt coming in.
Commissioner Marcus raised the topic of the PBSO Mobile Data Project debt service on $35 million in bonds – raised by TAB members Iris Scheibl and Jim Donahue in their talks. Joe Doucette confirmed that the capital had not been drawn down as would be expected and discussion ensued around paying off the debt to eliminate around $6M in debt service. Marcus wanted a status on the project.

PBSO Budget – Commissioner Marcus and PBSO COO George Forman discussed civilian longevity and step raises and whether or not a Florida Statute would allow them to cancel or defer up to $11M in increases from occurring. While Mr. Forman stated that the $11M applied across the board (uniformed and non-uniformed staff) – Marcus replied that if 40% of staff wasn’t sworn – then wouldn’t it be true that about 40% of the $11M applied to civilians. Back and forth on the statute written to apply specifically to PBC and no other counties. Discussion on whether or not Fire/Rescue or PBSO contracts could be opened due to ‘exigent operational necessity, eg: financial catastrophe. It was unclear what kind of status report or response from PBSO would result from the querying other than direct response requested on the status of the Mobile Data Project.

Chairman Aaronson brought the conversation back to overall budget discussion. Aaronson favored cutting CCRT (Countywide Community Revitalization Team) and management of environmentally sensitive land $$ for a modest cut of $2-3M. He was absolutely against blue pages cuts or layoffs of ANY COUNTY EMPLOYEES. Ridiculous discussion then ensued stating that to cut $30M (TAB proposal) would result in a 750 person lay-off (when TAB proposal was actually 268). Aaronson said that any lay-off would hurt the Palm Beach County economy, result in further defaults on homes, so OUT OF THE QUESTION. After much discussion they concluded that they were only talking savings to the taxpayer of $8 if cut the spending.

Commissioner Abrams didn’t agree with the whole approach. Felt that we needed to do large scale reductions (eg the blue pages without closing the pools). That the county should do outsourcing. He rejected comparison to cities that have kept their millage rate flat, however – stating that the County doesn’t control PBSO and that Fire/Rescue isn’t in the county base millage rate.

Commissioner Santamaria was looking for a target; he would accept the motion of 4.75 millage if a $$ target were set. None ever was.

Commissioner Aaronson said that no way would $36M ever be cut and no matter how many people groups like TAB brought in, more could be brought in to say they want continued services and $$ spent. He could fill the chambers with them.

Commissioner Marcus would support the motion if the $6M in the Mobile Data project was pursued for a total range of $5-$15M in cuts.

Commissioner Vana was willing to postpone some capital (eg Mobile Data) and referred to a discussion from another meeting on jails vs ankle bracelets. She also suggested looking into contingency audits for the next budget to find low-hanging fruit – but absolutely no lay-offs or privatization. Looked directly to the TAB folks and said you won’t get to 4.34 millage this year – but maybe some of these actions would get us closer in the future.
Commissioner Taylor spoke against any attempt to outsource, citing an issue of Government Magazine. She also stated that one can’t compare cities to counties and that the Commission only does what the people want. And the people wanted Scripps and Max Planck. There was a lot of discussion with Commissioner Aaronson and Administrator Weisman on the history of the jails, Scripps and Max Planck – after which Commissioner Taylor said that the people want these things and then they have to pay for them.

There was a small amount of additional discussion on targets and then the Commissioners had their 5:1 vote on the Aaronson motion. The remainder of the meeting was to go through approval of all the other MSTU millage rates and transfers. Fire/Rescue was not touched. The meeing was adjourned.

Correction

At the end of the article “An Analysis of the County Budget Proposal – Part 1”, the TAB cuts were applied against a “starting point” of the rollback county-wide taxes of $612,486,522. To this figure we applied the “green page” cuts ($22.5M), and TAB modified “blue page” cuts ($30.6M), and the “Sheriff’s Challenge” of $3M, totaling $56.1M, and providing for $556M in taxes. We then calculated an effective millage rate of 4.381.

County Budget Director Joe Doucette pointed out to us that this is not a correct computation, since the county adjustments used to compute the 4.75 millage took into account other factors besides spending – specifically the “budget hole” that had to be filled due to lower non-tax revenue in some areas, and the “statutory reserve” requirement that requires $1 of taxes for each $.95 of budgeted requirement.

In the July county calculation for 4.80 millage, all the green pages are assumed ($22.5M) and the tax amount is $609.6M – so in effect, about $3M in tax reduction cost $22.5M in spending reductions due to factors mentioned. To then get to the 4.75 millage, another $6M in cuts were necessary, and that came from the Sheriff ($3M) to be provided by a return of unspent funds, and a county match of ($3M) that Administrator Weisman was able to find revenue to cover.

Joe then calculates the effect of our additional $30.6M cuts (blue pages) as follows:

Millage	Ad Valorem
4.75	603,303,606	a 9.3% tax rate increase
	(32,185,431)	Sum of TAB blue cuts net of statutory reserve
4.4966	571,118,175	a 3.5% tax rate increase

So, in order to keep the millage flat at 3.44, we would need an addtional $20M in cuts.

This was an interesting discussion and I would like to thank Joe for taking the time to talk me through it. There was one thing that I was still unclear about however – weren’t the blue page cuts designed for flat millage if all were taken? It would seem that we would still be short. Joe explained the missing piece – county staff offered the additional blue page cuts on the condition that PBSO would cut an equivalent amount to “share the pain”. Our calculation did not take that into account.

Therefore – we need to amend the TAB proposal to request that in addition to the $30.6M in blue page cuts that TAB recommends, PBSO should absorb a similar amount (which would be about 6.6% of their budget). Alternatively, a $20M cut by the Sheriff would allow a flat millage under these assumptions.

Call to Action

[ PRINT ]

The TAB Proposal

The first milestone on the TAB agenda was passed on September 2, 2010 with the first public meeting. A package containing the presentations from that meeting, along with supporting material and an executive summary is being delivered to the County Commissioners and Adminstrator on 9/8.

If you would like a copy of that packages, you may print and bind the following files:

NOTE: Budget Director Joe Doucette pointed out an error in my calculation of the millage resulting from the TAB recommended blue page cuts of $30.6M. Please CLICK HERE for the details.

	Cover Sheet
	Contact Sheet
	Executive Summary
	Meeting Synopsis
DIVIDER
	Why TAB
	An Analysis of the County Budget Proposal
	What Do We Know about PBSO
	What Do We Know about Fire/Rescue
	Proposal for Identifying and Prioritizing Core Services provided by Palm Beach County
	Where Does the $56M Budget Increase Go?
DIVIDER
	Printable Presentation Charts

TAB Holds Public Meeting on County Budget

Last evening, September 2, in the county library on Lantana road, 60-70 interested citizens turned out to listen to a presentation by TAB on the county budget. (CLICK HERE to view the presentations).

Many people were surprised to see that even in these tough economic times, with 12.2% unemployment in the county and plunging real estate values, the county spending is projected to increase yet again, by $56M in fact.

The county firefighters, already paid an extremely generous average compensation of $140,000 / year – are going to get another raise – to an average of $146,000, at a time when pay for other county employees has been frozen. Their level of pay has risen 50% since 2003, while inflation has only been about 20%. The feeling of outrage in the room was palpable as this was explained by Realtor and TAB member Christina Pearce.

Federal stimulus money (also know as ARRA – the American Recovery and Reinvestment Act) has been flowing into the county at a prodigous rate – over $100M this year, allowing the county to increase spending while ad-valorem taxes are (modestly) declining. One of the items on this spending list is $50M for “Neighborhood Stabilization” grants – basically money to give or loan to people who are buying up foreclosed properties and fixing them up. Would the county be spending this without the federal funds? Hard to say, but if this spending level was done without the ARRA money, our taxes would have to rise by 31% according to calculations by SF 912 and TAB organizer Fred Scheibl.

The county has assumed too much debt for questionable reasons and much of the requested new borrowing for capital projects in the FY2011 budget should be deferred or canceled, explained Lower Taxes Now and TAB member Sherry Lee (who is also a candidate for county commission district 2). Sherry described almost $100M in potential deferrals, including money being allocated for airport expansion, even though the whole project is tied up in a lawsuit, and the FAA has not approved the project.

The time has come for defining our “core services”, explained former PBG councilman Hal Valeche, also a member of SF Tea Party and TAB. Citing examples from around the country where progress has been made in trimming outdated or extraneous items from budgets, Hal called on the county commission to require a thorough categorization of all county spending to determine what is “core” and what is “discretionary”.

The whole structure of our county government should be subject to scrutiny, argued SF912 member and TAB member Iris Scheibl. She applauded the county commission for calling for a charter review next year and proposed that TAB be a part of that effort. The relationship between the commission and the constitutional officers, particularly the sheriff need to be examined, for example, to bring more transparency to the internal workings and spending priorities of the PBSO.

After a summary of the “TAB Proposal” to cut $171M from the 2011 budget, moderator and SF 912 founder Shannon Armstrong took questions from the audience. Many pointed out areas that TAB has not so far examined and should (like the School Board), and others added valuable insights into areas like the Fire-Rescue “Kelly Day” concept.

Commissioner Jess Santamaria attended the meeting and spoke briefly at the end, suggesting that we are only addressing half of the problem – that there is still a lot of corruption surrounding the way the county spends its money and he gave some examples where the grass roots have been effective in stopping it, as well as other areas where they could.

It should be noted that all the commissioners were invited, along with the constitutional officers and the county Administrator. Commissioner Shelly Vana said she would attend but did not. Property Appraiser Gary Nikolits was in the audience, as was Budget Director Joe Doucette, and Communications Director Linda Culbertson from the Clerk and Comptroller organization, representing Sharon Bock.

TAB wishes to thank those who participated in the meeting and asks that everyone who is concerned with the excessive levels of spending in the county attend the budget hearings on 9/14 and 9/28, and to ask their commissioners to “Adopt the TAB Proposal”. CLICK HERE for the “Call to Action” containing contact information for the Commission.

Here’s a few pictures of the event: