Property value dip expected to ease in 2010
3/8/2010

By Doug Sword

The hit to property values this year will not be as large as earlier forecast, but the recovery of those values will take longer, a new state forecast says.

In November, state economists predicted a 14 percent drop in Sarasota County's tax base when property assessments come out July 1. But the group of economists revised their forecast this week, cutting the projected decline to 10 percent. Manatee County's forecast was similarly sliced.

The new forecast fits into a recent pattern of economic news still being bad, but not as bad as it was. Two weeks ago, the state released data showing that sales were still down for area businesses during the last quarter of 2009, but not as much as they were the year before.

If the new forecast pans out, it would mark the first time since the recession began that Sarasota County's tax base fell less than the state's. The recession hit earlier and harder in Sarasota County where the tax base plummeted at triple the state average in 2007.

The state economists project that statewide the taxable values of property will fall 10.1 percent in the July 1 assessments. Meanwhile, Sarasota County's drop is projected to be 9.7 percent.

But there also is a downside to the new projections, which show a deteriorating long-term picture. Last year's estimate that Sarasota County would bounce back with 4 percent growth to its tax base next year was cut to 1 percent. Manatee's was cut from 5 percent to 3 percent.

If accurate, the numbers mean cuts expected by governments in Manatee and Sarasota may not need to be as drastic as thought. The improved projection translates into about $6 million in tax collections for Sarasota County and about $8 million for Manatee.

"It's a good trend," said Sarasota County Deputy Administrator Dave Bullock. "It shows maybe things aren't falling as quickly as they've been falling."

Even with the $6 million improvement in its budget picture, the county is still looking at a budget shortfall of about $40 million next year, Bullock noted.

Sarasota County is expected to go through another round of budget cuts later this month. Libraries and public transit have been on the short list of services facing cuts. And the sheriff's office, which is the largest county operation paid for through property taxes, had been asked to keep its budget flat for a fourth consecutive year.

Down 78 positions over the last two years and with a state mandate to provide more courtroom deputies in juvenile cases, Sheriff Tom Knight said he has told county officials that the sheriff's office will be hard pressed to keep his budget from growing.

"This year is going to be a very difficult one," Knight said.

A somewhat rosier budget picture could make a big difference if it proves difficult to keep law enforcement spending flat.

The new forecast may translate into more money for governments, but also less of a tax cut for residents. For the typical home assessed at $200,000, a 14 percent decline in value would prompt a tax cut of about $370. The tax cut shrinks to about $250 with a 10 percent cut.

The new numbers also seem to fit with a trend seen in Southwest Florida for the five counties running from Manatee to Collier.

Manatee was the last and lightest hit of the five counties, while the four to the south saw their tax bases erode earlier and more steeply.

While the recession seemed to roll from south to north, perhaps the recovery is rolling from north to south, said Jim Seuffert, Manatee County's chief financial officer.

State economists had forecast that Manatee County's tax base would dive by 20 percent during 2009. But when the numbers came in, Manatee was down only 8 percent, far less than the counties to the south, Seuffert noted.

The new state forecast also projects that the tax bases of the counties to the north will recover more quickly.

The long-range forecast is for taxable values in Manatee and Sarasota counties to grow more quickly than in the three southern counties.


Source: Herald Tribune