Mary Esther dilemma: Raise taxes, cut law enforcement or close library?

July 28--MARY ESTHER -- Boosting the millage rate, reducing law enforcement services or closing the local library are the city's three main options to balance its fiscal 2018 budget, Mayor Chris Stein said Thursday.

"We have a half-a-million (dollar) shortfall in our General Fund budget, and we have to do something to fix it," said Stein, who has served as mayor of Mary Esther since April 2016. "We can nickel and dime the budget (to balance it). We only have a $3 million budget."

The new fiscal year starts Oct. 1.

Stein said the city's money problems stem largely from years of poor financial planning.

"We've been overestimating our revenues" such as property tax and state-shared revenues "and have been pulling money out of our reserves," said Stein, who added that the city's expenses have not really changed much.

The city had roughly $5 million in reserves about six years ago, but now has only about $1.2 million, he said. Of the current amount, $650,000 is in restricted reserves, meaning it can be used only for dire emergencies, such as paying for post-hurricane cleanups.

"We have to build the reserves back up to about $2.5 million," Stein said. "We're in a high danger area in terms of hurricanes. It wouldn't make sense to pull more money out of reserves."

He also said that during the Great Recession, the city reduced the millage rate for fiscal 2009 to 2.69 mills (or $269 per $100,000 of taxable value) from the previous year's rate of 3.01 mills. The rate stayed above 2.6 mills until fiscal 2016, and currently is set at 3.88.

"We kept it at 2.6 for too long," Stein said.

Options

He said City Manager Taylor Brown, who started late last year, is now trying to end the reliance on reserves. At last Monday's budget workshop, Brown and the City Council discussed various ways to help balance next year's budget.

One way would be to increase the millage rate, Stein said.

"If we bring it to 5.03, we could get about $306,000 more income," he said. "That's politically dangerous, but it's an option."

Another option, he said, would be to decrease the level of law enforcement services that the Okaloosa County Sheriff's Office provides to Mary Esther, which has about 3,800 residents. Next year's public safety budget currently is projected to total a little more than $1.5 million.

"We pay the same amount of tax money as the unincorporated areas for basic Sheriff's Office services, but also an extra $395,000 for "'enhanced' law enforcement, which basically provides one extra deputy who works solely for Mary Esther," Stein said. "In our 2-square-mile area, he's supposed to be there all the time. But there's talk that we don't need that. We have a very low crime rate, and we might not need the instant response of a law enforcement officer."

Each year since at least fiscal 2007, most of the calls for service in Mary Esther have been medical, according to city information. Stein said while response times likely would be slower in the basic service scenario, the city would save money.

Another option to help balance the budget is to close the Mary Esther Public Library, which could have almost $384,000 in expenses in next year's budget.

But talk at Monday's meeting about possibly closing the library has caused a public uproar, Stein said. For example, the library staff posted a message on the library's Facebook page Wednesday that urged patrons to tell Brown and each council member that closing the facility "is not an option."

Stein opposes closing the library.

"We don't have a pool, tennis courts, ball field, a Fort Walton Landing or anything of any value," he said. "The only thing we have is the library. If we get rid of that, we might as well become unincorporated and let the county worry about our financial problems."

Stein, who does not have a vote on the council, said he and Brown favor using basic rather than "enhanced" law enforcement services and deleting a few new vehicles to balance the new budget without raising taxes.

"The problem is, the council has two members who are friends with the sheriff," Stein said, referring to Councilmen Jim Kitchens Jr. and Danny Bennett.

Other views

Kitchens said a Mary Esther resident who attended Monday's workshop was the person who suggested closing the library. Regardless, Kitchens is fighting "tooth and nail" against any reduction in law enforcement services.

"You need somebody (from the S.O.) here 24 hours a day in case something happens," he said. "We have six banks and multiple other businesses here."

Kitchens also said it takes seven employees to run the library, and seven for City Hall.

"It doesn't matter if the library is open or closed or has reduced hours," he said. "Everyone (from each city department) is going to have to tighten their belts. How many people actually use the library?"

Bennett noted that the council has a ways to go before finalizing the budget.

"You're always looking at cutting things," he said. But some city leaders "are trying to cut law enforcement, and that's not what citizens want in this day and age. No one wants to lose any jobs, and I definitely don't want to lose any (law enforcement) protections."

The council's next budget workshop is set for 7 p.m. Monday, Aug. 7. Its first budget hearing is scheduled for 6 p.m. Thursday, Sept. 7, and the second and final hearing is set for 5:30 p.m. Monday, Sept. 18.

The meetings will be at at City Hall at 195 Christobal Road N.

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