St. Johns County considers Fire MSBU

July 18, 2008

The St. Johns County Board of County Commissioners is considering implementing a Municipal Service Benefit Unit to fund fire services in St. Johns County as previously reported by Historic City News.

All property owners in St. Johns County were sent mailed notices this week identifying the maximum fire rescue assessment for Fiscal Year 2009, which begins October 1, 2008. The notices also announce a Public Information Workshop on Wednesday, July 23, at 7:00 pm and a Public Hearing on Tuesday, August 5, at 9:00 am. Both the Public Information Workshop and the Public Hearing will be in the County Auditorium, located at 4020 Lewis Speedway in St. Augustine.

A Municipal Service Benefit Unit, or MSBU, allows a special assessment to be charged against a property of a specific locality because that property derives a special benefit from the expenditure of that money. This means a special assessment may be charged against properties in St. Johns County to pay for fire protection services because those same properties gain the benefit of having fire services provided. Some examples of other services legally funded through MSBU’s in the state of Florida include parking facilities, street improvements, solid waste collection, sewer improvements and stormwater management.

Fire services in St. Johns County are currently funded through ad valorem property taxes, which means residents pay different amounts for fire protection based on the taxable values of their properties rather than the actual cost of providing fire protection service. Switching to an MSBU, a non-ad valorem assessment of equal amounts paid by owners of like properties, will provide a more equitable basis for payment of fire protection services.

The Board of County Commissioners has been clear, however, that a non-ad valorem MSBU will not result in increased taxes or a double-taxation. Instead, the implementation of the MSBU would result in a reduction of ad valorem fire taxes. The new fire fee would simply allow the funding of fire services to be handled in a more fair and equitable manner.

There are several benefits of switching to a fire assessment MSBU. One benefit is that an MSBU is a tax equity tool, meaning residents would pay the same amount for the same service, rather than paying based on the taxable value of their property. Currently five side-by-side condominiums of identical size and similar fire protection needs may pay five different amounts for fire services as part of their property tax bill, even though the same two fire trucks and ambulance would respond if any of the five condominiums needed fire services.

Another advantage of an MSBU is that it would provide a dedicated revenue source to provide fire services. This dedicated revenue source would ensure the funds collected in the MSBU would be used only for fire services. By having a dedicated funding source, the County will be able to proceed with its Master Plan of building a fully professional fire department and constructing additional fire stations throughout the County. Residents would not only benefit from the increased fire services, but many will also receive lower insurance rates and higher property values by having a fire station located closer to their properties.

Additionally, the MSBU would provide accountability to taxpayers. Data has been compiled to establish the actual cost per billing unit for fire facilities and services provided. The assessment fees are based on these established costs for different property types and allocated based on the proportionate cost of providing fire services to them. Categories of the special assessments include residential, commercial, industrial/warehouse and institutional. Factors considered in the calculation of the special assessments included the County’s response standards (such as rate of water flow and personnel required to respond), as well as hazard class and square footage of the structure. Specifying types of properties and assessing them based on the actual cost of providing fire services to them is one of the core components of an MSBU.

The process of implementing an MSBU is multi-step. The Board of County Commissioners contracted with Tallahassee-based Government Services Group to assist with researching the data, defining the benefit and service area, calculating assessment rates and preparing an MSBU. Then, on June 10, 2008, the County enacted Ordinance 2008-34 and adopted Resolution 2008-165, which established the MSBU. The municipalities of St. Augustine, St. Augustine Beach and Hastings have also passed ordinances supporting the MSBU. In fact, the City of St. Augustine currently uses an MSBU to fund their fire services.

As required by Florida Statues, St. Johns County mailed notices this week to each property owner alerting them of the maximum amount that may be assessed to each property under the MSBU. At the Public Hearing on August 5, the Board of County Commissioners has the option of implementing the full assessment, implementing any portion of the assessment or not implementing the MSBU assessment at this time.

Residents who have questions about the MSBU may get more information by visiting the County website at www.sjcfl.us/FireMSBU, calling (904) 209-1760 or attending the Public Information Meeting at 7:00 pm on Wednesday, July 23.

Written by Freddy · Filed Under Government

Comments

One Response to “St. Johns County considers Fire MSBU”

howardallgood on July 21st, 2008 9:24 pm

Monday, July 21, 2008
Via email
Dear Commissioner,

I ask that this letter be read into the minutes of the public hearing on July 23, 2008

I am an absentee owner of a small business park on US1 South .

I have today been made aware by an adjoining property owner that you plan to place a special assessment on my property as well as others in St Johns County for fire services. I have not received my assessment as of the writing of this letter but due to the shortness of time before the Wednesday meeting I felt that I should address the commission now.

His building is the same age and construction as my order building but much smaller than mine. They are both metal construction and he has been assessed $5,600.00 for his building. Based on his assessment mine could be around fifteen thousand dollars. My complete tax bill at this time is $3,875 of which I am charged $291.00 for fire. How can this be fair and equitable?

Upon viewing the County Webb Site, You claim “that it has been made clear that a non-ad valorem MSBU will not result in increased taxes or a double-taxation. Instead, the implementation of the MSBU would result in a reduction of ad valorem fire taxes. The new fire fee would simply allow the funding of fire services to be handled in a more fair and equitable manner.”

If this is the case then let it alone. No one is complaining that their fire portion of their tax bill is not fair and it should be changed. It would seem to me that if this was the case it would not be worth the expense of paying a consultant and the cost of implementing this special assessment if it would not result in additional revenues in the County coffers.

This special assessment comes at a time when there is a movement in Tallassee to lower property taxes. Local governments envision a scenario of: budgets running deeply into the red, with no cash to fund items such as parks, transportation, fire services and environmental preservation due to the down turn in the economy and this tax reduction movement.

This assessment comes at a time when everyone as well as all the real estate in St Johns County is in deep financial distress. We are in the same predicament that the County is in and it is unfair to try to pass the County’s shortfalls on to its taxpayers rather than do what we have had to do and that is find ways to cut cost, not find ways to support an administration that is now over employed in the red and over committed to provide improvements to the county.

We have in the last two years been hit with spiraling insurance premiums that are now close to our property taxes along with the highest energy cost in our history. Taxes in Florida are now much higher than in most parts of the country and while our legislature is moving to cut property taxes you have found a way to assess property owners with a special assessment which will not be affected by a property tax roll back. The St Johns County Webb Site touts this as a way of more fairly spreading the cost of fire services to those who use them but we, the taxpayers, see this as a way of the County assuring itself that it will have the same income stream that it had gotten use to during the real estate boom that has now ended.

There are other considerations that you should consider at this time in a recessionary economy other than the need for better fire protection.

What you should do, as responsible Commissioners, is the same thing private enterprise and the citizens on this country has had to do. Just as we have had to lay off employees, cut current employees salaries, cancel proposed projects and cut back on spending, you should do the same rather than look for loop holes to continue to fund the county budget.

Yes, it would be great to have more fire stations and better equipment to provide to our firefighters and yes it may help in saving my property if a fire occurred but it is not something that I can afford and you should not take it upon yourself to force this on me under the vise of it will lower my insurance rates and increase the value of my property, it will not. I am fully insured and that is all the protection I need and can afford.

Just because we have property that is assessed at hundreds of thousands of dollars, that does not mean we thousands of dollars in our checking account to pay these additional taxes and yes they are taxes, an invalid ad valorem tax clothed as a special assessment.

Ask yourself if the fair market value of the property is an adequate measure for considering a taxpayers means and ability to pay this assessment? It doesn’t take into account the mortgage, insurance and other taxes and financial condition of the tax payers during these poor financial times we are going through.

You might think, well all he has to do is pass the cost on to his tenants and let them pay the increase. Well my tenants are overburdened with decreases in business and increased operating cost due to insurance and energy cost and the over the board increase in living expenses and the cost of goods for their businesses. They can no more afford a new operating expense at this time than I can.

The increases that you propose will ultimately cause hard working small businesses such as my tenants to have to move to lesser expensive space or go out of business altogether. My space is some of the cheapest in St Johns County now so I am afraid they will opt to go out of business. Without their rental income I can not meet my mortgage obligations and foreclosure will pursue.

This will ultimately do more harm across the board than having a better fire department and will cause a decrease in the tax base rather than generate more revenues to operate the County.

I urge you not to adopt this special assessment at this time and leave well enough alone and seek other ways of balancing your budget.

Howard Allgood