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Hernando Today

County Prepares For Life After Amendment 1

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Michael D. Bates

Published: February 2, 2008

BROOKSVILLE - BROOKSVILLE - Amendment 1 passed by an overwhelming margin Tuesday by voters crying for property tax relief.

Now, the county has to find a way to pay for the loss of revenue, which Budget Director George Zoettlein expects to be $9.1 million.

Can Zoettlein put together a budget that will do it?

It won't be easy, but he thinks he can.

"Certainly the waters are a little choppy out there right now, but we'll get through it," he said.

While Zoettlein is crunching the county's numbers, taxpayers are looking at their own household budgets trying to figure out how much money they will realize with the passage of Amendment 1.

They will see relief in the form of a doubled homestead exemption: from $25,000 to $50,000 for homeowners whose property is assessed at $75,000 or more.

Included in that amendment is the portability of the Save Our Homes tax benefit, which means homeowners can take the benefit with them to their next home. That constitutional provision sets a limitation of 3 percent on annual assessment increases on homesteaded-exempt property.

For example: If a person lived in a home 20 years and accrued a Save Our Homes valuation less than the actual market value of the house, the homeowner can take that accrued savings with them and apply it to the market value of their new home.

While all this sounds like money in the bank for homeowners, what do county officials think about the situation?

The answer boils down to three words: streamline, cut and reevaluate.

"The first thing we need to do is prioritize our needs and certainly public safety takes a front seat," County Commissioner David Russell said.

He said Zoettlein and Interim County Administrator Larry Jennings are already crunching numbers to look for interdepartmental efficiencies and determine possible cuts.

"The bottom line is we're going to have to cut," Russell said.

Will the county be forced to raise the millage rate to recoup revenue?

Not under his watch, Russell said.

The people spoke loudly they want tax relief and he said he plans to honor the spirit of that amendment.

"I am not going to go against the electorate by raising taxes," Russell said. "That's just not going to happen on my part."

Russell said he will expect county staffers to submit recommendations of department streamlining, possibly in time for Tuesday's commission meeting. He is expecting department heads to look even closer at their upcoming budgets to see if there is anything they can trim.

Those recommendations, he said, need to come "sooner rather than later."

"There's an old saying that, 'Government will expand and contract to fit the dollars allotted.' We now have an opportunity to contract government operations.

"We have to live within our means," he added. "No one's saying this is going to be an easy task. Maybe we're going to discover some efficiencies that we didn't know existed and that there are some services that we can truly do without."

Will that mean possible cuts in employee staffing?

"It's highly possible and that's an unfortunate consequence," Russell said.

Weathering the storm

This is the second budget whammy to hit Hernando County in a year.

To meet state mandates, Zoettlein last year had to cut about $7 million out of the 2007-2008 budget.

Zoettlein is anticipating Hernando County will realize a reduction of $9.1 million in ad valorem taxes for fiscal year 2009. That's assuming the general fund millage rate remains unchanged at 5.4394 mills.

That is a result of lost revenue from this week's passage of Amendment 1 plus the anticipated reduction in property taxes as forewarned by the property appraiser.

Zoettlein said he is still poring over the budget to come up with a cost-trimming plan.

The county's taxable value will drop from $11.5 billion to $9.5 billion because of the amendment, Zoettlein added.

Rather than "chop away" at the budget to get the county where it needs to be fiscally, Zoettlein said he will "surgically decrease."

"We will look at service levels and the value of services we provide to the public and see if we're in line and where we should be," Zoettlein said. "We will look at other counties of similar size and see how much it costs them to provide services at the same level."

Zoettlein is positive the county will weather the economic storm and he will submit a balanced budget by his July 15 deadline.

And he doesn't think county commissioners will raise the millage to generate money.

Streamlining, cutting and pinching pennies

County Commissioner Rose Rocco said the county will have to learn to cut back and do without some services.

"We're going to have to look at every department," Rocco said. "We need to determine what are the needs and what are the wants and the needs are going to take priority."

Rocco said she wants to look at present staffing levels and see if the county can do more with less.

"That's the reality of it," she said.

Rocco said she will also have to take to heart the streamlining strategies suggested by former county administrator Gary Kuhl, before he resigned last November.

Those strategies include eliminating several departments, merging others and having department directors take on more responsibilities by managing more than one department.

For example, the director of the community services department might also serve as the parks and recreation manager or the health and human services manager, depending on the background and experience of the selected director.

"We're going to have to look at everything," Rocco said. "Everybody's trying to crunch the numbers to get a better feel of what we're dealing with."

It is not certain how the budget crunch will affect the planned expansion of the Hernando County Jail.

"That's a budget buster," Rocco said.

To save money, the county is exploring other alternatives to expansion, one of which makes sense to County Commission Chairman Chris Kingsley.

By attaching ankle-monitoring ankle bracelets on low-risk criminal offenders, it would free up space at the Hernando County Jail and save about $55-a-day, Kingsley said.

It seems like a small cost at first, but multiplied by hundreds, it adds up, he said.

Kingsley said the county anticipated the passage of Amendment 1 and planned for it by already moving ahead with streamlining procedures.

Many residents have asked for the county to dismantle THE Bus as a cost-savings alternative.

THE Bus, Hernando County's beleaguered public transportation system, has been a money-losing proposition since it debuted in 2002 and critics have called for the permanent grounding of the system.

The service is costing the county about $600,000 annually. That price is expected to go up when the county loses state and federal funding for the system.

Kingsley said tampering with THE Bus may not be practical now, given the rising cost of gasoline.

In times of need, people rely on public transportation to get to their jobs, the doctor or stores, he said.

"Normally as the economy goes down, public transportation increases," Kingsley said.

But in an effort to cut costs, no area of county government is immune from the budget-probing magnifying glass.

Even THE Bus.

New county administrator David Hamilton, speaking from Minnesota, said he is anxious to get on board in Hernando County and tackle the budget, especially because of the challenges posed by Amendment 1.

Barring a problem with contract negotiations, Hamilton said he plans to get here by March or early April.

Hamilton said the budget will be a top priority when he arrives, especially with the July 15 balanced budget deadline looming.

"Given the budget cycle and the tremendous dynamics awaiting the budget in Hernando County, the sooner (I arrive) the better," Hamilton said.

Reporter Michael D. Bates can be reached at 352-544-5290 or mbates@hernandotoday.com.

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