Tallahassee set to finalize budget, raise utility rates

Tallahassee’s $889 million budget for the new year — fueled by a 16.5 percent increase in new construction — is up for a final public hearing this week before the City Commission votes to adopt it.

The city’s property tax rate will remain as is, resulting in an average 2.1 percent tax bill increase for residential customers protected by Save Our Homes, and a 4.9 percent increase for commercial and other property owners not protected by Save Our Homes. 

The tax rate is 4.69 percent higher than what the rate would be if the increase in revenue were applied to rolling back the budget. Because maintaining the current rate would bring in additional revenue, it would be considered a tax increase under Florida law.

The public hearing is scheduled for 6 p.m. Wednesday at the City Commission Chambers, 300 N. Adams St.

City staff recommending Tallahassee budget, tax, pay increases

More:City commissioners vote for budget, tax increase

The budget includes a 3 percent general salary increase to help offset increases in health costs. The budget doesn’t contemplate hiring any new staff except for those that are funded by grants. Firefighters will see a 3 percent raise and police will get either a 3 percent or a 4.5 percent raise, based on collective bargaining agreements negotiated with city administrators. 

Here’s how the budget breaks down, according to the city’s agenda item:

• A General Fund budget of $158,835,225 for police, public works, parks and recreation, and housing and human services.
• General Fund and Enterprise fund operating budgets of $727,275,185, which includes fire, utilities, building services, golf and cemeteries.
• An annual capital improvement plan investing $161,808,271 to modernize roads, sidewalks, stormwater, water, sewer, electric and technology.
• A five-year capital program estimated at $887,065,892, including a public safety campus, two new parks, Florida State University electric buses, and taxiway rehabilitation.

The commission on Wednesday also will hold two public hearings to consider changes in the electric and gas rates. The city is proposing increasing electric rates for residential customers by 2.4 percent, while lowering gas rates by about 12 percent, based on a rate consultant’s study. 

Despite the increase in the electric bill, city staff said residents starting Oct. 1 can expect a decrease of 3.3 percent in their monthly bill thanks to a reduction in fuel cost recovery charges — from $112.81 to $109.07 for the consumer of 1,000 kilowatt-hours a month.

Gas rates could decrease bills after October 1, 2018 by about 10 percent , from $58.75 to $52.79, for a typical customer whose winter usage is about 40 ccf a month.A ccf equals 100 cubic feet.

The rates are based on two components — the base rates and fuel cost recovery charges, said Robert Wigen, director of resources management for the city. 

The base rates are increasing, Wigen said, because “we borrowed money to modernize the fleet of our generating plants, which has realized efficiencies in the delivery of electricity and lower fuel costs.”

“That is the reason bills will be going down in October,” Wigen said. “There will be folks who want to look at base rates, but on the bill, customers pay two parts of delivery. The full story is bills will be going down.”

MEETING MOVED

The Oct. 24 meeting of the Tallahassee City Commission has been moved to Oct. 17 to accommodate Mayor Andrew Gillum's gubernatorial race campaign schedule. The Leadership Florida and Florida Press Association will be televised live from the Broward College Central Campus in Davie from 7 – 8 p.m. Oct. 24. 

Contact Schweers at jschweers@tallahassee.com. Follow him on Twitter @jeffschweers.