Martin County Board of County Commissioners
To: Martin County Commissioners and County Administrator
From: Budget Committee July, 2016 Richard Geisinger - Chair
As many of you may know, I have asked a diverse group of residents to look at the MC Budget and make recommandations to the Board based on information that was shared with us over the past few months.
The committee members include: Mark Brechbill (CPA), Lisa Bebout (PNC Wealth Management), Nick Amaro (CPA), Diane Mckechnie (Retired), Glenn Zillhardt (Secretary of Seabranch Master Association, and Chuck Barrowclough (Biologist).
During the past few months we have met with:
Jennifer Manning MC Budget Director
Don Donaldson MC Engineer
Kevin Abate MC Parks and Recreation Director
Mike Durham MC Attorney
Taryn Kryzda MC Administrator
As a basis for the study we reviewed key indicators of our growth patterns in real estate values, population, and government expenditures over the past 15 years:
2015 $18,633,364,511 80% (approximate) increase
2015 150,062 18% (approximate) increase
2015 $318,755,110 60% (approximate) increase
These growth patterns indicate what appears to be an unsustainable growth rate in government expenditures. Over the past 15 years our property assessments increased 80% producing more tax revenue, while our population grew only 18%. We realize that there are other revenue sources included in the funding of “Government Expenditures” category, however, at the end of the day, these expenditures are actual expenditures and in fact, this is what was spent.
Looking forward, the 2016 real estate assessments are expected to increase 5.1% to just under 20 Billion, at the same time the population growth estimates are low, (they have averaged 1.2% annually for the past 15 years) and are expected to be less than that this year. These increased real estate assessments will produce additional tax revenue as well as the FPL franchise fee recently approved by the board.
After studying the budget, this Committee recommends or respectfully requests the county to consider the following:
1. Martin County has been a leader in developing a Comprehensive Plan that allows the County to have local control over its development and economic future. This Plan provides a great deal of detail relative to how and in what manner the tax payers of Martin County would like to see their community grow. Unfortunately, there is no long term economic plan that converts this Comprehensive Growth Plan into specific financial needs and costs, and provides for the most effective methods of funding our County’s future vision. We believe that the County and its taxpayers need a Comprehensive Economic Plan that utilizes the vision created by the Comprehensive Growth Plan to project costs and capital needs if the Comprehensive Growth Plan’s objectives are met. This Economic Plan would include a projection of what funding tool and tax base will best fund this Growth, and should cover a period of not less than 30 years. It should be
updated any time the Comprehensive Plan is amended or whenever better
indices become available to support the Plan. Currently, it does not appear that the County’s funding sources and amounts fit with the types of costs they are supporting. Thus, it appears that long term costs are being funded with short term money, and short term needs are being met by potential long term
financing commitments. The growth of county expenditures cannot continue as it has historically. It is simply not sustainable.
2. Legal Costs: We have received historic information concerning the legal department’s expenses as well as historic data on the use and expense of outside counsel. After reviewing this information the Committee suggests that the Board consider how they implement their policies, especially in the growth management and comprehensive plan areas. Like any other board, policies can produce efficient implementation or expensive, litigious implementation. And, it appears that many policies have or will produce expensive litigation. Additionally, the public should be able to easily access the amount of money the county is spending on outside counsel and individual law suits. This should be broken down by jobs, similarly to job costing in the private sector.
3. Sales Tax: The committee believes that voter approval of the sales tax referendum would have provided a much needed, non-millage revenue source with the added advantage a significant portions of taxes coming from visitors and nonresidents. This failed to pass due to public perception that county leadership has not demonstrated fiscal responsibility and the public lack of confidence and clarity that the sales tax revenue would be properly
allocated to agreed upon expenditures. Additionally the lack of unity within the board itself negatively influenced the final outcome. If the board wants to consider the possibility of another referendum, we believe the board must demonstrate fiscal restraint now. This could be accomplished by actually reducing the millage rate.
4. Real Estate Analysis: The idea of studying county owned real estate was a wise decision, however, like anything else, the devil is in the details. Because CB Ellis does not have any specific expertise in the area we would hope the board would have the local real estate community weigh in on the recommendations. Additionally, Martin County’s own internal real estate department has a tremendous amount of expertise and information that could contribute to important decisions concerning what to sell and what to hold. And finally, if we decide to sell assets, the proceeds of those sales should never be used for operations. These proceeds should be allocated to our capital reserve shortfall or be placed in a separate account for the purposes of capital needs in the future.
5. Diversified Tax Base: the County should not only agree on what industries they would like to attract (which we believe are identified in the growth management plan), they should also insure that these industries are welcomed in the community. In other words, actions speak louder than words. There is an opportunity now to look at an industry in Indiantown that could produce jobs, work in harmony with the environment, and produce sustainable energy. If this industry demonstrates that it is environmentally sound, the county should not only be flexible, they should be welcoming. Much like FPL, the county kept the company from investing outside the county and now we have a long term project that ultimately benefits Indiantown and the MC taxpayers.
6. Economic Development Plan: to truly diversify the tax base the county should agree on a long term economic development plan that is consistent with the comp-plan. This is critical to obtaining a diversified tax base. The positive side of this study would be an agreement up front on the scale and type of industries the county is looking for which eliminates the conflict when an industry is considering Martin County.
7. Communication: the ability to communicate with staff is an important aspect of good leadership. As a result of the diversified opinions of the board, it appears that the leadership gives mixed messages to both the public and the staff. As a result, operations become inefficient, they begin to lack in creativity and develop negative attitudes. Basically, staff becomes fearful of doing anything due to the fact that they will offend one side or the other. This produces very narrow choices for staff, which ultimately puts an end to creative problem solving.
8. Fire Merger: we were disappointed that the fire merger talks never concluded. However, we are hopeful that the study will ultimately give the county direction concerning the extremely high cost of fire/rescue. We urge the county to continue the ongoing negotiations with the department and hopefully additional study will reveal actionable ideas that provide specific ways to reduce costs. Fire assessments fees might be one way to actually lower the costs to the average property owner with improvements.
9. Compatibility: over the past few years the county has developed strained relationships and mistrust with the City of Stuart as well as Jupiter Island resulting in litigation and inefficiencies. The taxpayers find this unacceptable. This is simply wasted time and money. Steps need to be taken to rebuild trust. These municipalities are not going anywhere and we must reach out to them… we are all one family.
The budget committee wishes to thank the county for considering these recommendations. We realize we are still climbing out of the recession and the backlog of capital projects weighs heavily on fiscal decisions.
We have had the privilege of meeting many key staff in the Martin County Government in the past few months and have found them to be professional, talented and very knowledgeable. They have proven to be very capable, especially when given a clear direction.
We would hope that the commission would begin to speak with a more unified voice to staff as well as the public.