Fire District Q&A on fire assessment proposal
QUESTION: What is the ballot language for the June 4 Lehigh Acres Fire District Special Election?
Funding Lehigh Acres Fire District
Services, Administration, and
Capitalwith Non Ad Valorem Property Assessments
ANSWER: As an alternative to ad valorem taxes, may Lehigh Acres Fire District annually levy non ad valorem assessments beginning fiscal year 2020 to fund fire protection, rescue, emergency medical services, administration, governance and associated capital not exceeding $165.00 per parcel plus $1.00 per $1,000 of value of improvements thereon using property appraiser data, together with identified administrative costs and statutory discounts, with increases limitedby growth in Florida personal income over the previous 5 years?
__ Yes __ No
QUESTION: What is the current standard used by Lehigh Acres Fire Control and Rescue District to assess properties including undeveloped lots?
ANSWER: The District collects its revenue from non-ad valorem assessments instead of ad valorem taxes. The current assessment program is based upon an assessment methodology report prepared for the District around 2015 and uses different assessment rates depending upon the use of each parcel and the square foot size of the improvements on each parcel.
QUESTION: How do I know what my current assessment is?
ANSWER: The current assessment rates are on the District’s website and available upon request.
QUESTION: How long has this been the standard for fire assessments?
ANSWER: The current assessment program took effect in 2015.
QUESTION: What changes is the District looking to make?
ANSWER: The District is considering a more equitable option with a base assessment rate plus a separate assessment rate for improvements on improved parcels. The expectation is that the range between the lowest and highest assessment rates will come closer together so that there will be a smaller difference (less disparity) between assessments on improved land and on vacant lots.
QUESTION: Why does the District want to change it?
ANSWER: Many citizens have requested a more equitable assessment for improved and unimproved parcels. The current assessment methodology report was based on conditions in 2015 when the District’s operating expenses were artificially low, due to the economic downturn. In order to pay its operating expenses, the District obtained concessions from employees, implemented work force reductions and other cost reductions in District operations. As a result, the 2015 assessment methodology does not and will not cover the costs of present and future District services. The District should have already opened a sixth fire station in the northwest part of the District. There were a number of very damaging brush fires several years ago; however, the District cannot afford to hire personnel to staff a new fire station under the current assessment revenue.
QUESTION: How does this affect taxpayers in Lehigh Acres?
ANSWER: The goal of a new assessment methodology is to create a more equitable distribution of the District’s operating expenses among all of the parcels in the District. Another positive outcome would be the expense of a sixth fire station could be included in a new assessment methodology so that the District could provide better response times for the taxpayers who reside in the northwest part of the District.
QUESTION: When would the change take effect?
ANSWER: A new assessment methodology could possibly take effect for the 2019-2020 fiscal year of the District, which begins October 1, 2019.
QUESTION: What say in this does the public have?
ANSWER: There are statutory requirements for two public hearings, usually held in August and September, when the public can voice their opinions about the current and proposed assessment rates (or ad valorem taxes).
QUESTION: What misconceptions are out there about all of this?
ANSWER: One misconception is that a change in the assessment methodology will result in an arbitrary increase in the rates. This is not true. Many property assessments will actually decrease. Also, the proposal will go through the same approval process as in 2015. After an assessment methodology report is prepared which uses the District’s true operational costs to calculate the new assessment rates, the District will hold public hearings.
QUESTION: What other districts or cities use the proposed assessment methodology?
ANSWER: We are aware of at least 7 circumstances where the simplified fire approach has been approved by Florida courts. As you know, independent fire control districts (special purpose local governments) require a referendum of voters first. That is not the case with general purpose local governments like cities or a county.
QUESTION: How much total revenue does the district receive through the existing methodology? How much revenue will the district receive through the methodology proposed?
ANSWER: In 2018/19, the district received approximately $15,424,000 through the existing demand-based (GSG) method of assessment from all eligible parcels. This amount included collection costs, Tax Collector’s fee and fees associated with 4% statutory discount for early payment. For example, a single-family home with one dwelling unit would have been assessed $332.15, which included $14.74 for other costs, (the collection cost, the Tax Collector’s charge and fees associated with the 4% statutory discount for early payment.) The resulting net revenue from each single-family parcel with one dwelling unit was $317.41.
If the proposed simplified method is chosen by the voters, the projected net revenue from fire assessments would be approximately $25,000,000. This amount does not include collection costs, Tax Collector’s charges and fees associated with 4% statutory discount for early payment, which would be added to achieve the total NAV assessment amount.
So, you see the charge using the new method is about the same or a little less for homes, and less for many businesses, but will raise the $8-10 million shortfall the District suffers from. Please see our explanatory resolution we adopted Wed; it’s on our website.
QUESTION: What would be the projected cost difference for the average homeowner? For the owner of a standard undeveloped residential building lot? For the owner of a one-acre parcel zoned for non-residential development?
ANSWER: Sorry, but that is an apples to oranges comparison. The proportionality is achieved by looking at the parcel, not the acreage, for ALL parcels; AND looking at the amount of improvements on the improved parcels.
Here is what we do know: approximately 11 out of 12 homes will pay the same or less as last year and raise $8-10 million more if the ballot question passes. Most businesses will pay less. The exemptions will be the same. And, included in the above analysis, all improved and all unimproved parcels with pay $165.
The owner of one parcel, regardless of size or zoning, would be assessed $165.00 because the predominant cost to the District is being ready and having service available to ALL parcels.
The change in paradigm is that the focus is on what it costs the District to be ready and available all the time instead of looking backwards and trying to assign actual calls made in a wide variety of circumstances to a wide variety of property uses. The demand-based method may be legal, but it has not proven adequate, and the Fire Commission has heard that it is viewed as disproportionate as to unimproved parcels since inception.
QUESTION: What is the current developed vs undeveloped parcel ratio? What would it be under the new methodology?
ANSWER: Again, that is answered above. Here are statistics approximately 90,000 of the approximate 125,000 parcels in the District are unimproved subdivided lots.
Under the demand-based (GSG) method the undeveloped lots were charged around $25, under the simplified method on the ballot question, ALL parcels (improved and unimproved) are charged $165, and improved parcels are additionally charged proportionately more based on the amount of improvements on each improved parcel as compared to all improvements on all improved parcels. The ratio of undeveloped to developed is not relevant. The proportionality and reasoned basis for the charges being fair and reasonable is what we have to pay attention to. The good news is that Florida’s courts and other communities have done this already, and it can be put to work reasonably in Lehigh Acres to solve this dilemma. Please do read the explanatory resolution which is on-line at LehighFD.com.
-Source: All answers provided by Lehigh Acres Fire District