The Mystery of Millage Rates
October 17, 2009 Leave a comment
City officials are repeatedly saying to us that the millage rate is “lower than two years ago”. (And why didn’t they mention that the millage rate is much higher than last year–more misinformation and misdirecting the commentary!). In fact, the millage rate is a simple residual after calculating the budget needs and other sources of revenue such as permit, fire and other fees. What counts for the city are property assessments and new construction and the budget requirements, and then comes the millage rate to calculate the revenues to fill the gap with the other income source.
The city fathers do us no favor by having a lower or higher millage rate. They do us a favor by better managing the city’s budget–that is the variable that counts. Why in the world does the city want to keep spending merrily on capital projects during a crisis–this gives the impression that the commissioners and city manager think that the recession will be over quite soon. Why can’t the city reduce the number of the senior managers now they have reduced the number of low level staff?
Now that the unemployment rates is 11 percent in Miami-Dade (this means really means 20 percent measuring discouraged workers and part-time employment at lower wages) and will certainly not be back to normal for several years, and is much higher than the national average of 9.8 percent.
Also, there is talk in financial circles of mortgage problems increasing among new groups of homeowners, not in the subprime category, but in conventional loan categories. The does not portend a good future for the city’s property taxes.
Another kind of silly statement is that the Coral Gables taxes are only (say) 27 percent of your total tax bill. Right, it is only a 27 percent, but two years ago it was a lower percentage of the tax bills. Now Coral Gables is the fastest growing share of our property tax bills.
Therefore, mayor and commissioners, plan for the worst and hope for the best. Let us see what happens in the coming months.