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Now browsing: Hometown News > News > Volusia County

Ponce Inlet will raise taxes almost 17 percent
Rating: 3.12 / 5 (59 votes)  
Posted: 2012 Sep 28 - 00:08

By Michael Salerno

For Hometown News

PONCE INLET - Prepare for a tax hike.

Town leaders recently voted to raise taxes almost 17 percent over last year as a result of increased legal fees from the town defending a property rights lawsuit by a developer.

The town unanimously finalized a tax rate of $5.50 per $1,000 of assessed value for the 2012-13 fiscal year as well as a $4.7 million budget. The tax rate is above last year's millage rate of $4.76 and the rolled-back rate - which would have generated the same amount of revenue as last year - of $4.71.

Councilwoman Mary Hoss said she "reluctantly" voted to approve the tax rate after pleading with her colleagues for a higher tax rate of $6.015 to raise additional funds that would be placed in the town's reserves if an unexpected expense comes about, such as additional legal fees in the town's appeal of lawsuit by Pacetta over a proposed working waterfront that included dry boat storage.

"The reserve, I believe, should be kept at a healthy six-month level," Ms. Hoss said. "... We have no idea what's in Ponce Inlet's future."

Town Manager Jeaneen Clauss said the town's legal budget increased almost 3 percent from last year. The budget allocates $760,000 for legal expenses, which makes up 16 percent of the budget - the second-highest expense for the town after public safety.

Earlier in the summer, town leaders set an initial property tax rate of $6.25 so the town could finance a possible settlement with Pacetta property owners Lyder and Simone Johnson. Finalizing the rate of $6.25 would have resulted in a 32 percent tax increase over last year and generated an additional $700,000 in revenues.

But they considered lowering that rate to $5.50 after Pacetta's attorney Peter Heebner rejected the town's settlement offer of $1.5 million, which town leaders said was the most they could legally offer based on the town's financial situation.

Pacetta sued the town over development restrictions the Johnsons say only affected properties they owned and a 2008 charter referendum - invalidated in a 2010 court ruling - that restricted the size of dry boat storage and prohibited it in the zoning district where Pacetta's 16 acres are located. The litigation remains ongoing, with an appeal hearing and jury trial that would decide how much, if any, damages the Johnsons should be awarded expected later in the year.

Mayor Gary Smith, who initially supported raising the tax rate to $6.25, said he could not support going up to $6.015 after the settlement offer was rejected. He said town leaders made a commitment to reduce the rate from $6.25 if the Johnsons rejected the proposal.

If the town council adopted the $6.015 tax rate, it would have raised taxes 27 percent over last year.

"With all due respect," the mayor said, "the money (that would be raised from a higher tax rate) is better off in the citizens' hands than the town treasury.

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