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Home My WebLink AboutAgenda Packet CC - 08/13/2018 - Special Called Meeting 2006 HERITAGE WALK, MILTON, GA 30004 ǀ 678.242.2500 ǀ WWW.CITYOFMILTONGA.US Persons needing special accommodations in order to participate in any City meeting should call 678.242.2500. Joe Lockwood, Mayor CITY COUNCIL Peyton Jamison Matt Kunz Laura Bentley Joe Longoria Rick Mohrig CITY COUNCIL CHAMBERS City Hall Monday, August 13, 2018 Special Called Meeting Agenda 5:45 PM 1) CALL TO ORDER 2) ROLL CALL 3) PLEDGE OF ALLEGIANCE (Led by Mayor Joe Lockwood) 4) APPROVAL OF MEETING AGENDA (Add or remove items from the agenda) (Agenda Item No. 18-220) 5) PUBLIC COMMENT (GENERAL) MILTON CITY COUNCIL SPECIAL CALLED MEETING AUGUST 13, 2018 Page 2 of 2 Persons needing special accommodations in order to participate in any City meeting should call 678.242.2500. 6) PUBLIC HEARING 1. Consideration of an Ordinance of the Mayor and Council of the City of Milton, Georgia, to Establish the Ad Valorem Tax Rate of the City of Milton for Fiscal Year 2019; and for Other Purposes. (First Presentation at August 6, 2018 Special Called City Council Meeting) (First Public Hearing at August 6, 2018 Special Called City Council Meeting) (Second Public Hearing at August 6, 2018 Regular City Council Meeting) (Agenda Item No. 18-218) (Bernadette Harvill, Finance Director) 7) UNFINISHED BUSINESS 1. Consideration of an Ordinance of the Mayor and Council of the City of Milton, Georgia, to Establish the Ad Valorem Tax Rate of the City of Milton for Fiscal Year 2019; and for Other Purposes. (First Presentation at August 6, 2018 Special Called City Council Meeting) (First Public Hearing at August 6, 2018 Special Called City Council Meeting) (Second Public Hearing at August 6, 2018 Regular City Council Meeting) (Third Public Hearing at August 13, 2018 Special Called City Council Meeting) (Agenda Item No. 18-218) (Bernadette Harvill, Finance Director) 8) NEW BUSINESS (If necessary) 9) ADJOURNMENT (Agenda Item No. 18-221) J ESTABLISHED 2006 2018 Property Tax Public Hearing 2 AGENDA Examine important definitions Cover public hearing requirements Discuss 2018 proposed millage rate Breakdown Maintenance & Operating Explore anticipated revenues Offer rationale for holding current millage rate steady Discuss ways to reduce your property tax liability Calculate your tax bill Examine the value your tax dollar List the pros & cons of rolling back the millage rate DEFINITIONS Mill -$1 per $1,000 of Assessed Property Value or .001 x Assessed Value. Fair Market Value –An estimate of the market value of your property as determined by the Fulton County Board of Assessors. Assessed or Taxable Value –The assessed or taxable value is equal to 40% of the fair market value. Property taxes are calculated by multiplying the millage rate by the assessed or taxable value (and adjusted for any exemptions). Roll-back Rate –The previous year’s millage rate minus the millage equivalent to the total net assessed value added by reassessments. 2018 PROPERTY TAX PUBLIC HEARING 1st Public Hearing –August 6, 2018 9:00 AM 2nd Public Hearing –August 6, 2018 6:00 PM 3rd Public Hearing & Vote –August 13, 2018 5:45 PM Note: Any increase beyond the computed roll-back rate requires three public hearings to allow for public input. Computed Rollback Rate (4.031) vs. Proposed Millage Rate (4.731): –17.37% due to reassessments of existing real property 5 2018 PROPOSED MILLAGE RATE Maintenance & Operating (M&O) Millage = 4.731 (CAPPED) Greenspace Bond Millage (Principal & Interest*)= 0.706 (VARIABLE) Total City Millage Rate 2018 = 5.437 * 2017’s Bond Millage Rate was based on an interest only payment while 2018’s is based on principal and interest payments due. M&O DIGEST BREAKDOWN MAINTENANCE & OPERATING (M&O) Net M&O Tax Digest = $2,857,805,010 Total M&O Taxes Levied = $13,520,276 –M&O Real & Personal Taxes = $13,394,736 –M&O Motor Vehicle Taxes = $125,540 7 GENERAL FUND REVENUE ANTICIPATIONS General Fund Revenue Anticipations –The FY19 budget anticipates a collection rate of 90% for Real & Personal Property Taxes and 50% for Motor Vehicle Taxes for maintenance and operating (M&O) –M&O Real & Personal Taxes = $12,021,176 –Motor Vehicle Taxes = $62,770 BOND REVENUE ANTICIPATIONS Greenspace Bond Fund Revenue Anticipations –The FY19 budget anticipates a combined collection rate of 85% for Real & Personal Property Taxes and 50% for Motor Vehicle Taxes in the Greenspace Bond Fund –G.O. Bond Debt Service Real & Personal Taxes = $1,700,003 –G.O. Bond Debt Service Motor Vehicle Taxes = $9,372 * G.O. (General Obligation) Bond RATIONALE FOR HOLDING MILLAGE RATE Impact to the City’s capital improvement projects –Deferred projects in 2017 & now deferred 2018 capital projects Challenges of a capped millage rate –Limited commercial tax base & commercially zoned footprint –Assessed property values have not kept up with market since 2008 –Community vision to retain rural character Unknown long-term fiscal impacts of proposed homestead exemption referendum 2018 final assessment appeal data not available 2017 tax digest still hasn’t been certified by the State OPPORTUNITITES FOR TAX SAVINGS Homestead Exemptions Basic Homestead Exemption (apply with the County) •Primary residence; no age or income restrictions = $15,000 Senior Exemptions (apply with the City) •Age 65+ = $15,000 •65+ & meets income qualification = $25,000 •Age 70+ & meets income qualification = Full Value Exemption Disability Exemption (apply with the City) •Disability certified by a licensed physician &meets income qualification = Full Value Exemption OPPORTUNITIES FOR TAX SAVINGS CON’T Conservation Use Value Assessment (CUVA) If you qualify, the property value will be based on land use and not market value. No minimum amount of acreage. Maximum is 2,000 acres. –If less than 10 acres, owner must submit additional relevant records regarding proof of bona fide conservation use. Owner agrees to maintain property in bona fide qualifying use for a period of 10 years. CALCULATING YOUR TAX BILL Home with a Fair Market Value of $400,000 Assessed Value (40% of FMV) =$160,000 Less Homestead Exemption =$(15,000) Subtotal =$145,000 Multiply Millage Rate x .004731 Total Taxes Due =$686.00 THE VALUE OF YOUR TAX DOLLAR Average Fair Market Value = $400,000 Tax Bill with $15,000 Homestead Exemption = $686 Service Annually Monthly Daily Public Safety 295.51 24.63 0.81 Municipal Court 10.97 0.91 0.03 Public Works 69.87 5.82 0.19 Parks & Rec 54.34 4.53 0.15 Community Dev 34.54 2.88 0.10 Gov Body & Admin 107.49 8.96 0.29 Capital (Pay-Go)113.28 9.44 0.31 Total 686.00 57.17 1.88 PROPOSED RATE VS COMPUTED ROLLBACK Service Annually (4.731) Annually (4.031) Public Safety 295.51 251.79 Municipal Court 10.97 9.35 Public Works 69.87 59.53 Parks & Rec 54.34 46.30 Community Dev 34.54 29.43 Gov Body & Admin 107.49 91.58 Capital (Pay-Go)113.28 96.52 Total 686.00 584.50 $101.50 FMV $400,000 w/ $15,000 exemption PROS & CONS OF ROLLING BACK MILLAGE The following slides examine the pros and cons of rolling back the millage rate from 4.731 to 4.031, an inflation neutral millage rate. PROS FOR 4.031 MILLS Depending on 2018 Fulton County assessed value, net neutral millage rate (4.031) may maintain or reduce tax liability. (Note: Due to reassessments, some still may owe +.) Ability to maintain existing base-level (Maintenance & Operating) services. (e.g. no staff layoffs; minimum maintenance vs proactive services/actions) Millage rate changes do not direct affect property value, but may improve property marketability for individual property owners. A variable millage rate approach could reduce City’s Pay - Go strategy for Capital Projects, resulting in voter-approved G.O. Bonds. CONS FOR 4.031 MILLS Unable to complete 2017 deferred Capital Projects –Scheduled replacement of police vehicles & fire apparatus –Annual pavement projects –Replacement of self-contained breathing apparatus for fire –Seed money for Providence Park improvements Continued deferment of Capital Projects in 2018 Restricted ability to consider new initiatives (both Maintenance & Operating and Capital Projects) Results of deferred short-term capital maintenance = more costly capital replacements in long-term (e.g. forgoing routine pavement management results in more expensive full-depth reclamation paving) CONS FOR 4.031 MILLS May require reprioritized services/possibility of reduced services (e.g. right-of-way mowing may occur less frequently) –Note: Outsourced city services have inflationary escalators, so the costs of these services have continued to rise while our revenue collections have not kept up due to Fulton County Board of Assessors not maintaining property valuations. Milton’s capped millage rate prevents catch-up in future years like some other cities. CONS FOR 4.031 MILLS May impact the City’s capital contributions to local school facilities through our current intergovernmental agreements (IGAs) with Fulton County Schools. (e.g. Milton funds field improvements such as new sod, annual seeding, or newly installed turf; additional lighting & seating; basketball court resurfacing; etc.) Impacts our continued efforts to attract and retain a highly talented workforce to meet the needs and expectations of our citizens. –Note: This is not only wages/benefits, but retention is critical for a staff our size (e.g. turnover of one-two person department has > impact) QUESTIONS?