Pasco County meeting record

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1Feb 22, 2022
Board of County CommissionersR57Regular businessNo disposition in the minutes
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28m
Kathryn StarkeyChair
R fifty seven.
Oh,
County Administrator
we'll make it all the way through. We'll save mic Mike and the rabbit discussion for right before lunch.
Bob
Okay.
Good morning. Bob Gorey, Pasco County Budget Director.
So this morning I'd like to have discussion with you regarding what we see going on in the economy and the impact that we believe that it's likely to have on next year, fiscal year twenty-three budget. And yes, it is time to begin planning for the fiscal twenty three budget. As you can see here, the growth rate in the economy has been about between a two and two and a half percent, just bopping along since two thousand sixteen, with the obvious exception of the downturn during the uh COVID shutdown. It's been two two and a half percent prior
to that shutdown and it's been two and two and a half percent after the uh downturn in the economy. We expect that to continue. in the future, uh unless there are what we call economic headwinds that are impacting that economic growth And there are two areas that we're keeping an eye on. One is the growth in wages. As you can see here, the the Unemployment rate is at an all-time low and it has remained at an all-time low in the Tampa Bay region, Pasco County included, for the past couple years.
You can see it was six and a half percent last year at this time nationwide. And yet here in Pasco it was three and a half percent this time last year and it remains at three and a half percent. And so what that does is with that low unemployment And with the very high demand for employees, that's going to cause wages to increase, as we can see here. The uh Employment cost index is increased by about four percent. And that is the employment cost index measures all compensation, not just wages, but wages and benefits.
And so that's increased by about four percent. And we expect that to continue. You'll notice that although wages have increased by by four percent. They're not keeping pace with inflation. We're we're seeing record inflation, primarily because we have forces working on both the uh supply side and the demand side. So on the demand side, we have the Federal Government pumping lots and lots of money into the economy through the American Rescue Plan stimulus monies. And on the supply side, of course, we have all the supply chain
issues that we've been hear about hearing about for all these reasons. So you figure you got lots and lots of money out there that people are uh willing to spend. And on the other side, we have a lot of the same thing Yeah. We have uh Not a whole lot of stuff for people to buy. And so Uh we have a lot of money. Chasing too few goods. As a result, we have an increase in inflation of about 9.6 percent. And that's 9.6 percent. That's the Tampa Bay region, and that's the highest we've had inflation in this
region for 40 years. And you'll notice that this inflation rate is higher than the inflation rate nationwide. So in the in the country, nationally, the inflation rate is 7.5%. Here it's nine point six percent. always higher in Florida than it is throughout the nation, but that gap is much wider than we would expect. You'll notice one of the uh offshoots or one of the impacts of that high uh inflation rate is the impact on housing. And here you can see the more Orange or amber the color,
the higher the change in home values. Pasco County being in the middle, you can see home values over the past year have increased in value between twenty five and thirty-five percent. We'll notice the producer price index has increased 9.7 percent. So the consumer price index and the producer price index are very similar. The consumer price index measures the basket of goods for the normal household, what you and I would buy in our household. The producer price index measures what we as an employer would purchase. And so
that's the right-of-way. Is very similar to the CPI. So produce a price index nine point seven percent. You'll notice a big driver of that is the cost of construction materials.
Kathryn StarkeyChair
Okay, that is a crazy crap.
Bob
That is that's insane.
Kathryn StarkeyChair
Yep.
Bob
And anyone who's been out trying to buy a two by four recently and feel the pain of that eighty-seven percent And now you can feel Eric's pain. He's trying to estimate the cost of the new construction projects that are going on in the county. And no matter how much we think these prices are going to go up, they always they always surprise us. They're always up higher than we think they are.
Unidentified speakerVoice A
Well you might not see as many big campaign signs throughout Pasco County with the what they share. I'm sure the citizens will be happy with that.
Kathryn StarkeyChair
Oh
Unidentified speakerVoice A
my God. They
Kathryn StarkeyChair
can all be nailed in trees.
Bob
So just to summarize, we are expecting that the economy, uh some of the factors in the economy are going to impact uh next year's budget. in in uh as we talked about the wages wage increase is gonna be one of those inflation is gonna be one of those and one of the hidden factors that's going to be here is that the the Federal Reserve has already announced that they're going to start curbing inflation. The way they curb inflation then is to increase uh interest rates. Yep. And so once interest rates are increased, once inter interest
rates hit about the four percent or higher, that then begins to impact our housing market. So there are fewer people in the housing market once that interest rate hits about four percent. And so the reason that's important from a budgeting standpoint is because fewer houses, that means the taxable assessed value is lower, which means in turn That are property tax revenues are lower. And so moving forward we're optimistic about the future. However, we do want to keep in mind That we want to, it's important to
maintain the level of service that our customers have come to expect. And given the rate of inflation and the increase in wages, just maintaining that level of service moving forward is going to be more and more expensive. And the second piece we want to look at is rising interest rates, as we talked about, reducing the uh taxable assessed values and and impacting In the long term. property tax revenues. It's not going to impact next year's property tax revenues because once a house is permitted, it takes about two years for that property to show up on the tax
roll. So this is a long term impact. And so what we're trying to do for the fiscal year twenty three budget is to take advantage of these good economic times. And at the same time, look to the future. We don't want to bring on additional costs now that we may not be able to sustain in the future.
And so here's Sally's favorite graph. We look at new home permits at record levels. As we talked about, those homes that are coming on board in 2020, those homes will show up on the tax rolls in 2022. And likewise That big blue graph, those homes will be showing up. Probably in the fiscal year 2023 tax rolls. And for that reason, we're expecting taxable assessed values to be at or near where they were last year. You can see the taxable assessed value in fiscal year 22 for this fiscal year was 10.8 percent.
I've been in local government for a long time, and I've never seen taxable assessed values that are this high and have been sustained at this high level for a long time. And so we want to prepare for the inevitability that they're not going to be at that level forever. Ever. And so for twenty-three we want to look at let's for planning purposes look at ten point eight percent being the increase in taxable assessed values. But what we've done here is a sensitivity analysis. We've run three different scenarios. We've done a low
And then a extreme increase. And so if we just look at that center, 10.8 percent, which was last year's increase. That would yield an additional property tax revenue of about twenty-seven million dollars. We have an agreement with the Sheriff's Office because increasing population also impacts his ability to respond. to his customers and so half of the increase. in the property tax revenues would go to the sheriff. about thirteen point six million. Of course with an increase in taxable assessed values, the increase
to the community redevelopment agencies as well as the Uh increases to the TIFF. TIFF, as you know, is used for transportation. Uh expenditures, that's about three and a half million. So at ten point eight percent, that would be an increase of about ten million dollars in property tax revenue for the board as well as constitutionals.
Kathryn StarkeyChair
Can I ask you a question? Yes,
Bob
ma'am.
Kathryn StarkeyChair
So What am I missing that you're payment to the C RA is staying the same at each percentage.
Bob
So the payment for the C R A, so this is a rounding thing, so that eight point four percent or a fifteen percent increase in taxable assessed values to the C R A is not I mean it's gonna increase it by less than a hundred thousand.
So if we look at half cent sales tax, so as you know, half cent sales tax is an indicator of of the economy doing well. And also half cent sales tax is a shared revenue and it is shared with the counties depending on county population. Not how much is spent here but the amount of population. And this is an indicator that the population of Pasco County is increasing relative to other counties. Other population. Bounties. You know what I'm saying? This
is an indicator. Our population's increasing than the average Florida County. Exactly. We're increasing faster than other counties.
Kathryn StarkeyChair
But I don't know how you tell that from that slide.
Bob
Well there's two things happening here. One is the economy is increasing, the economy is doing better. And since sales tax is based on population, not on how much is spent, as our sales tax revenues increase, that's a sign that our population is increasing relative to other population. Okay.
Christina Fitzpatrick
So from January twenty twenty it was two point seven five million and the amount of sales to December twenty first is three point roughly seven million.
County Administrator
So that's a linear line to linear to smooth out.
Christina Fitzpatrick
I know it was up and down.
County Administrator
Yeah, the up and downs. So that's a linear line. There's some seasonality to sales tax as well.
Bob
And you notice in May twenty that was the
Christina Fitzpatrick
But with the sales,
Bob
it's
Christina Fitzpatrick
gone up about a million dollars in revenue.
Bob
Yes.
Christina Fitzpatrick
So okay. So we'll bring in an additional penny for each of that. Thank you.
Bob
Yes, ma'am. And so I wanted to show you the Penny for Pasco revenues. As you can see, Penny for Pasco is doing well. Paying for Pasco crash there in May, which is that orange line. That was during the economic shutdown due to COVID. It's doing well. I wanted to show you this because those peaks, those are the sales tax revenues that uh we get from internet sales. And so the the state gives that to us on a quarterly basis. And there had there after the Mayfair or the Wayfair court ruling, there was the thought that this was going to have a a big increase in the amount of
sales tax that we were getting. But you can see in Florida we were already getting that internet sales tax, so the increase is going to be to be marginal and we'll find out next month exactly what that sales tax increase will be for Pasco County.
Communication service tax, this is the two point eight six percent tax that all of us have on our cell phones, tax, fax machines, internet, all that kind of good stuff. because of legislative action and people owning fewer types of things that are subject to this tax. The communication service tax has been decreasing by about two and a half percent per year and we expect that to continue. As you know, the communication service tax is what we use to fund the emergency 911 center. And so from its peak of six point uh six point
one million in two thousand nine until today, that's two million dollars that we're taking from the uh general fund property tax to make up for that decline in revenue.
Kathryn StarkeyChair
Madam Chair, can I ask a question about
this?
Yeah, and I have a question too. Thank you.
Unidentified speakerVoice A
Um, used to fund the 9-11 emergency communications center. When we say used to fund, um does that include salaries and benefits? Yes. the board? Absolutely yes. Because I was actually gonna bring this up at some point and it wasn't it it didn't mean it was going to be today. Um but one of my concerns just for the future of of the county as a whole As we know that we have to do that. the the folks that work in the nine eleven or nine one one emergency communications center That is one of the most stressful jobs, you know,
on planet earth. Literally, when it comes to stress. If you if you rank the stress that is you know, I think it was in the the last study I saw was quite some time ago. I think I looked at it was back in the mid our two thousand thirteens, fourteen, fifteens, but I'm sure that hasn't changed. Um so when we think about retaining these people, what's the attrition rate right now with the folks in the nine one one commun Emergency Communications Center?
County Administrator
It's hard and yeah. Yeah. Yeah. The other issue is remember they stay on privation longer than the average county employee because Not everybody they hire. is fit for that job long term. So they do lose quite a few during that probation period. So there there is that as well. And yeah, I I I think I know where you're going with this. Yeah. We are every three years we do a paying class study. We are doing that right now that includes SIR nine one one center operators and dispatchers. And so that will be
part of that and that will be addressed as part of the paying class study.
Unidentified speakerVoice A
articles in in some other areas across the country which are having high attrition rates and having trouble bringing those people in the center. So I did a little of my own due diligence to look for studies and things like that. 'Cause the last thing we want to do is not have that area staffed and staffed to the the fullest. So I mean obviously let's let's be honest and I've said this before nobody likes when I say this, but if there's positions and jobs out there that have high attrition rates are very stressful. Sometimes we need to pay those people more. Just a fact.
Kathryn StarkeyChair
Uh Commissioner Fitzpatrick.
County Administrator
Agree. Yeah. And we do that as part of the
Unidentified speakerVoice A
And I appreciate that. I just want to make sure we're
County Administrator
looking at that.
Christina Fitzpatrick
So I know y um you're pr mentioning the do we and you can bring it back the turnover rate, but and then do we have the mental health services set up for
County Administrator
So we do have a program through HR that addresses uh employee employee wellness and and there is a mental health piece Piece to that uh that they can get access to? Yes.
Christina Fitzpatrick
And then is there such a decrease due to all of the free phones that are out there? And then does legislature provide for the offset of costs instead of people having to purchase the phone? Well
County Administrator
this is this
Christina Fitzpatrick
is going from landline to cell
Kathryn StarkeyChair
phones.
Unidentified speakerVoice B
Yes, that's it. It's going from landline to cell phone and the vast majority of people that move down here don't necessarily change their bullion zip code. with their cell phone provider, which means they are getting taxed on where they used to live as opposed to in Pasco County. So it's based on the billing zip code of your your provide of what you give your provider. So if your credit card is still billing to a zip code in New York Then you get pa taxed on their C S T, not ours, and we don't get the revenue.
Kathryn StarkeyChair
Address that
just not we don't want to make everyone change their cell phone number, but if they could could um address that, so I'm sure there's some way with technology.
County Administrator
You don't need to change a cell phone number. I have one from Texas, but my building zip code is here in Pasco. Right. So somehow we have a cell phone number. I know
when Kevin was here, this was an issue he brought up leg every legislative session. Every year. He's doing that now still at it DP, but it's D Department of Mercy Management, it just doesn't get a lot of traction with the legislature.
Kathryn StarkeyChair
So um I do see a slight uptick and I'm wondering um d w for commercial and for businesses, they get for they get landlines. So do we get um Some revenue from those phones?
Bob
Yes.
Kathryn StarkeyChair
Okay. And Commissioner Mariano?
Jack MarianoVice Chair
I mean I think creating an awareness out there would be helpful. Um you could start internally with just our own employees knowing that uh that's gonna be a factor. But I if we can get uh Place like the Sun Coast News to do a story on it and kinda work with Tambry Lane to do some promotions saying, look, we we need the funding uh for the nine eleven center to protect you h while you're here and if you change your address on your billing And kinda get that word out, it may help.
County Administrator
In in compared to most northeastern states or Midwestern states, RCST is significantly lower. It to from some of its orders of magnitude lower.
Kathryn StarkeyChair
Um lastly, Commissioner Fitzpatrick, it can be
Christina Fitzpatrick
thank you. And what is the difference of the tax rate from a landline to a cell phone?
Bob
Well Salt Phone has the additional thirty-five cents per month that's charged, that's not on the landline. And so that thirty-five cents is because of the POS, the point of service.
Christina Fitzpatrick
So we actually bring in more revenue from the landline? I mean from the cell phone?
County Administrator
Yes, ma'am.
Christina Fitzpatrick
Oh interesting.
County Administrator
If they're billing zip codes in Pasco County Administrator.
Kathryn StarkeyChair
Okay. Okay, um move on.
Bob
All right, tourism has recovered. Folks are coming back to Pasco County, not least of which due to our tourism department and the great work that they do. You'll notice between 2017-2018 we increased the uh tourism development tax from two to four percent to fund the debt service on the Wiregrass Ranch Sports Complex, but after declining in fiscal year 20. Twenty one and we're again expecting an increase in revenues in that area in twenty two. Local option fuel taxes, you'll notice in April May
Fuel taxes declined when most people were staying at home and it took quite a while for these revenues to catch up. As a reminder, first local option gas tax is used to repair existing roads, and a second local option gas tax is used to build new roads or expand capacity of exist existing roads. And so it took a long time for these fuel taxes to recover. But here as we reach uh the end of the fiscal year you can see that those those taxes have recovered in this particular area.
County Administrator
The caution there would be is as the price of gas increases, people will start figuring out how to do things differently which would negatively impact this revenue source. And my guess is we're getting close to that that that pivot point here in Florida at three and a half to four dollars a barrel or gallon, sorry.
Unidentified speakerVoice A
Well
County Administrator
there's
Unidentified speakerVoice A
been news today that somebody caught cut off a supply and
County Administrator
because
Unidentified speakerVoice A
the current situation that might jack people then.
Yes,
County Administrator
our share. Some of the
Unidentified speakerVoice A
uh
County Administrator
economists are projecting oil to be over one hundred and fifty dollars a barrel, which would be another thirty three percent increase on your on the gas prices.
Bob
Which would really drive people towards electric cars and electric cars are not paying As much, nearly as much for the use of the roads that the rest of us are. And so not to put a too fine a point on it, but although we are expecting our revenues to increase, and in some cases and some scenarios substantially, we are also expecting increases in our expenditures. So for example, the shape the state's been kind enough to allow us to share the cost of Medicaid, and that's currently about eight million dollars a year, and that increases between three
and four hundred thousand dollars per year. We have employee health and retirement. We have as Dan was talking about the Compon class study coming up. We don't know what the impact of that will be. Indigent burials and cremations, this is not a large number, it's between forty and fifty thousand dollars a year, but we wanted to bring this to your attention. We have inflation, which is going to keep driving up the cost of fuel vehicles. New and used vehicles are increasing at about 40%. And then capital needs, maintenance, those kinds of things. Plus we have some new facilities opening
such as a couple of fire stations. So with that, I'll be happy to answer any questions that you may have.
Kathryn StarkeyChair
Yeah. Questions? Anybody?
County Administrator
Well there's uh the budget uh the high level budget schedule for you. Yeah, board notice uh we do have tentatively scheduled a workshop in late May. uh to kind of go a little more detail into specifics of the budget, I will s again to kind of echo what you know Bob said. It's gonna be a challenge maintaining our current level of service across uh across all our lines of businesses. Um with the expenses that we see right now. So this isn't necessarily a year we're gonna see a
lot of new initiatives just because of just trying to maintain our level of service across the enterprise.
Unidentified speakerVoice A
Thank you, ma'am. Just something to think about and Mr. Steinsteiner, we I and I've I've brought this up and had a conversation I think on the dias and maybe in private as well, and I think you and I have talked about it. When we talk about New growth can't always pay. for itself. We've had this discussion on many occasions. Especially when it comes to certain services that we have out there, common sense stuff, whether it be fire, whether it be um, you know, um the sheriff's office, whether
it be parks and recreation, on and on and on. Again, I'm not I don't not looking for discussion or debate or anything like that, but just something to think about 'Cause we'd have to look really dig deep into this. But is there a possibility where we do make sure new growth actually pays for itself. What do we need to look into when new housing or apartment complexes or whatever that product may be comes into the county? um that they do have to pay more to offset the cost so
that our current citizens are having to pay more for the services. So what can we do? If anything, you know, let us you know and and i you know and again I don't want to get into a debate about this today at all. This is could be a long conversation. I know we got somebody else coming on board, but let's again between Mr. Steinsteiner and and and Dan and whomever What can we do if anything
to help uh satisfy the need that we're gonna continue to have. And like you said, if we drop off We're gonna be in a pickle.
Yeah, I don't want to I'm not looking into a day. Just keep in the back of your mind, so let's talk about it down the road or in the in the um workshop or something.
Christina Fitzpatrick
Yep, Commissioner Fitzpatrick. This has been on my mind due to citizens' concerns and Of course the infrastructure and everything. So I was wondering if we need to be readdressing and looking at the impact fee and the mobility fees so we can stay caught up making sure our infrastructure is caught up with our growth and also when it comes to the Metropolitan Planning Organization, just looking at the future land use maps to make sure that our roads and our infrastructure is built. Because if we approve a project now
and it's not planning to be built for two, three four or five years from now, we can be working on those roads in advance. And my last question would be Is there a way to Kind of Prefund mobility or infrastructure costs and then when the builder comes in to build or the developer comes in to build their community. then they
can reimburse and pay back that fund. Commissioner Mariano.
Jack MarianoVice Chair
Thank you. I th I you know I think Pasco County led the way early on, uh with a lot of criticism about impact fee going up higher to help growth pay for itself as it comes in. And that doesn't take care of deficiencies, it only helps what's gonna be coming. I think that's a good thing. What used to be said was residential growth didn't pay for itself. But when you get higher end, you can't do it. Residential growth. you see it in Seven Oak, you see it in Starkey Ranch. That high tax base that's there, I think it fully pays its own way. More importantly, it's
good executive housing. which is going to get you better companies that are going to want to come in the area too. When you factor all that in Um the demographics that we want to look at as we approve things and try to push things forward it has a big factor for down the road and I think we d we're we've done a very good job with that. We just need to keep going. I think Pasco County You know, between the school system doing a great job as far as being a great place to attract people to come into the county as well. And I think the improvements we made between stormwater, all our
our services, going premier with our products, et cetera, is making us a very desirable place. Now Florida is right now I think because of our governmental leadership and I mean uh Governor DeSantis pushing the way to say, let's make Florida a great place to live. I think Florida is going to be a very desirable place for many years to come. I just want to make sure Pasco County as well is going to be a shining star in that growth to getting all the right people coming in. I do think we need to focus on That redevelopment up and down nineteen? Because that demographic
used to be a lot stronger when you had the retirees that had the pensions that had the money to go spend money elsewhere. That's why Golf King Mall has gone downhill because the demographics don't support it. A lot of the the r the r the strong commercial retail, as well as going from Wesley Chapel, they used to come over here to spend, is now when Wesley Chapel. Trinity has now got their own little base going with uh some great commercial too. So The shift is going, but I think for us to look at everything, that redevelopment's gonna be a big thing to look at as well. to keep up with everything. Chairman
Kathryn StarkeyChair
Mariano I think there are some things that have been said here that make me want to definitely um have a another primer in Um Development, impact fees, when does um infrastructure come in? Um urban sprawl, the cost of services. uh when you put 'em out in the country versus an urban core. There's a lot of planning principles that I think You know, we're not planners and Um
and and maybe some people don't understand uh those principles and we should talk about them. I think. And maybe as we've worked through the comp plan we will be having those discussions.
Ron Oakley
Commissioner Oakley. Um all these things I agree with Commissioner Mariano. We need to be looking at that and also While we're going through the budget process, we need to not forget about our staff. uh road and bridge, all all the staff in different departments and all. Because the entry level of pay you have to pay now has come up. But if we don't think about those folks that are at the top. And spread them. like they should be. And also don't
forget about the people in the center of Th from bottom to top. Make sure we have the right levels of improvement and salaries for for all of them. Because it's very important 'cause Uh right now we have some salaries that come in the lower level, just walk on. You're only two dollars from a person that's been with you several years and has the Um knowledge of how to work equipment and stuff like that. They're too close.
So it's gotta be spread out and I think they're doing a salary study. So I know that's something we're gonna look at. And I know that we're also working on a uh wages issue like that now. So we're doing that study. So
Kathryn StarkeyChair
All right, um members I wanna try and get the bunnies done so those folks don't have to come back and be here through dinner time.
Yeah, so let's let's go back to twelve real quick on this one.
County Administrator
Mike can get through his slides in three minutes.

OMB-22-0018

Official title

Every appearance1 of 1 are in a recording