Thursday, July 5, 2012

Punta Gorda's Budget Shortfall and Proposed Tax Hike

Yesterday's headline in the Charlotte Sun announcing that the City government was aiming to introduce an 18.2% tax hike reverberated with members of the PGCCC. The article noted that to fill in a $1.1 million hole in its proposed $18.3 million 2013 budget, the City Council agreed by consensus Tuesday to hike the city’s property tax rate by 18.2 percent. This kind of news is not only discouraging to those of us who would pay the higher tax rate, it's very bad publicity for Punta Gorda at a time when the housing market is showing some signs of improvement here. Our City Council should consider that potential new residents aren't looking to relocate in a town that increases taxes by 18.2% in one year.

Last Spring when the City first brought up the issues with the upcoming budget, the PGCCC warned of the foreshadowed tax to come and recommended action on serious cost reductions. Below is a letter published in the Sun in May written by PGCCCmember, Frank Mazur:

"Our economy is growing at a dismal rate and the Congressional Budget Office says the recovery is the worse since the depression. The Punta Gorda poverty rate is near 10%; higher in the county. One third of our residents earn less than $25,000 and 56 percent are over 60 years old. Residents are squeezed and inflation is under 3 percent. If you look at a typical person’s every day consumption the inflation rate is closer to 8-10 percent.  

Our national debt doesn’t include Social Security and Medicare obligations or pensions for federal, state and local workers of $4.4 trillion or $11.4 trillion we owe in home mortgages, credit cards, auto and student loans. Added up we owe $261,000 per capita and our annual per capita income is $27,000.

Our community hasn’t had economic growth and that has impacted property values and city revenues. Many residents are on fixed incomes which have been sluggish because of depressed interest rates and rare social security increases that are eaten up by higher medical costs.  

Though City spending has gone up since 2005 in excess of inflation, the population is flat. Yet with a budget shortfall of $1.7M the city officials are opting for a tax rate increase to sustain city spending.

Residents are being harmed by the enormous growth of our Federal government and are now exposed to a city tax rate increase. There’s never enough money for government and growing it slowly won’t make things better.  

We’ve been unsuccessful in cutting Federal spending. The city must live within its means; a tax isn’t free money."

1 comment:

  1. Raising taxes on Punta Gorda homeowners will only address part of the problem The City has yet to come up with a solution for the large unfunded ratios that exist in the firefighters’ and general employees’ pension plans. If the City does not address its pension issues realisticly, and promptly move ALL non-public safety employees to a defined contribution plan, the taxpayers better get used to huge tax increases or very diminshed services well into the future.