Rising taxable values will generate an additional $548,000 in revenue for the city of Fernandina Beach for the 2024-2025 budget under the rollback rate, according to a preliminary forecast by the Nassau County Property Appraiser.
However, the additional $548,962 will be negated by a three percent across the board city employee salary increase and the rising cost of employee benefits such as health insurance.
The city's 2023-2024 rollback property tax generated $18,245,101 at a rate of 4.8298 mills per $1,000 in property evaluation. The property appraiser's office told the city that $18,794,064 would be generated in 2024-2025 at a rate of 4.5567 per $1,000 in property evaluation.
The city's property tax rollback rate refers to the tax rate that would generate the same amount of property tax revenue as the previous year, adjusted for any changes in the property tax base (such as new construction, changes in property values, or other factors). The rollback rate is intended so that taxing authorities do not automatically receive a windfall due to increased property values.
According to the Property Appraiser's Office, taxable property values in the city increased by $361 million over the previous year.
Fernandina Beach city commissioners will set a millage rate on July 30, which is the amount of tax per $1,000 of taxable property value. That rate is determined annually based on the city's budget needs.
Commissioners will be hard pressed to adopt a city budget based on the rollback rate for 2024-2025 with inflation driving up operating and project costs. There are also proposals to add three fulltime and two part time officers for the police department and three firefighter/EMT positions at the fire department. The additions would add another $500,000 to the budget for those salaries and benefits.
"The rollback rate is not sustainable. It won't even cover the cost of inflation," said Commissioner Chip Ross. "There's also the cost for the renovation of downtown to consider."
Ross favors following Nassau County's practice of using the modified millage rate, which adjusts for inflation. Under that formula, the city's rising taxable value would generate an additional $1,077,772, almost double that of the rollback rate. Property owners who claim homestead exemptions would see no tax increase under the modified rate.
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