Incorporation will increase Hammock property owners’ taxes says Steve Milo.
Palm Coast, Florida – June 17, 2009
Dear Hammock Property Owner:
I am writing to you today as a property owner in Ocean Hammock.
In 2008, I was elected to the Ocean Hammocks Board of Directors and the Cinnamon Beach Condo Association Board of Director based on a platform of lowering costs and taxes.
I am writing this letter as a property owner to get out more facts about the costs and drawbacks of incorporation than the ones you are getting with your DCDD water bill. If you believe that adding another layer of government and higher property taxes are a good thing, then you may not like this letter.
Just as Property Taxes are going down, a group wants to incorporate the Hammocks.
Based on an assessed value of $500,000, the incorporation of the Hammocks is estimated to increase property owner’s taxes by as much as $1,000 or 16%.
The Dunes Community Development District (“DCDD”) is currently spending money on a consultant to write a feasibility study for incorporating the “Hammocks” into a new municipality which will substantially increase our property taxes.
This consultant will be conducting a telephone survey in the next few weeks to gauge support of incorporation among property owners in the “Hammocks” (Hammock Dunes, Ocean Hammock and Yacht Harbor). If there is enough support, the next step will be to spend yet more money to take this proposal for incorporation to the Florida Legislature for approval and then to schedule a referendum for registered voters.
Incorporation of a municipality is often considered attractive by several sets of citizens. Some citizens seek incorporation when they believe that they have been substantially harmed by a County government and demand self rule. Others seek incorporation when they seek greater levels of urban services and infrastructure from that which is currently provided.
Others may have political motives for influence or jobs that will come from a new municipality where a small minority of property owners actually live and are registered to vote. Notwithstanding the underlying reason for incorporation, the desire to become a municipality comes with a steep price.
#1. The average budget for a municipality with a population between 1,400 and 4,200 residents is approximately $3,000,000 per year.
The main source of revenue for municipalities comes through ad valorem taxes, which are garnered through the establishment of a millage rate. This eventual millage rate will be added onto the current ad valorem tax bill which disproportionately affects non-homesteaded property owners. Based on an assessed value of $500,000, the incorporation of the Hammocks is estimated to increase property owner’s taxes by as much as $1,000 or 16%.
Although municipal incorporation and annexations were a trend in the previous 10 years, the economic down turn has caused the desire to self govern to be virtually obsolete. One relatively new municipality (West Park in Broward County, Florida) is on the verge of bankruptcy because its mandated feasibility study was overly optimistic on projected revenue collection vs. expenses.
In fact, our legislatures in Tallahassee are no longer discussing municipal incorporation, but instead are debating municipal contractions.
#2. Creation and subsidy of Low Income housing and rentals
In addition, all municipalities are required to address the state’s affordable housing requirements. Affordable Housing needs might include the construction or subsidy of new low income housing units or rentals. Based on a review of the City of Bunnell and the City of Flagler, it is estimated the new Hammocks municipality will need to designate parcels for 144 low income owner occupied housing units and 126 affordable housing units for renters by 2015.
#3. One argument by some for incorporation of the Hammocks is to create a pre-emptive strike to prevent annexation by the City of Palm Coast.
Involuntary annexation occurs when all of the affected property owners do not readily consent to the annexation. Section 171.0413, Florida Statutes, provides that the approval of involuntary annexation requires a double referendum (separate majorities in the area to be annexed and in the annexing municipality.)
If there is any majority vote against annexation, the Ordinance will not become effective.
Flagler County’s Property Tax base is 83% Residential, 9% commercial, 1% industrial
Although the prospect of incorporation may seem exciting to some, this excitement quickly dwindles when a new municipality realizes that by state law it has to immediately address such controversial issues as affordable/low income housing and rentals, the creation and maintenance of new parks, comprehensive land zoning, schools and traffic.
The ability to plan a municipality’s future development and growth is such a critical task that the Florida Legislature has made the process of changing a property’s land use an extremely difficult and exhaustive task. The net result of this process is a large amount of legal and consulting fees that the new municipality must spend not including the significant costs and exposure for litigation from land use zoning changes.
While hefty consulting fees, large legal fees, and over $500,000 per year just in new government legislative, executive and clerical payroll will still excite the well connected few who get the spoils, it is yet more of a burden to the tax payers.
In conclusion, a decision on incorporation should not be made lightly. The residents must carefully balance their quest for independence against the cost of incorporation, the potential loss of homestead protection, the likely need to acquire and fund new parks and recreation areas, the provision for creating affordable/low income housing and rental units and an estimated 16% increase in ad valorem taxes to property owners.
Under the current economic environment, the incorporations of the Hammocks is ill-advised. I urge property owners to vote NO against incorporation.
I want to thank attorney Keith Poliakoff of Becker and Poliakoff for his research and effort on this matter. I borrowed heavily from his work.
If you would like to comment on this letter, please email me at email@example.com For additional information, please view web site www.HammockLowerTaxes.com
I am looking for volunteers to help defeat incorporation. If you are interested, please email me at firstname.lastname@example.org
Condo and land owner in Ocean Hammock
Steve Milo is also the Treasurer and a member of the Board of Directors for the Cinnamon Beach Condo Association.
Steve Milo is also a member of the Board of Directors for the Ocean Hammock Property Owners Association.
There is some well-deserved confusion about where the Ocean Hammock Property Owners Association Board stands on Incorporation. The OHPOA Board hasn’t yet taken a FORMAL position on incorporation. The OHPOA board will address this at a special meeting of the Board of Directors in the very near future. At that time the “official” position of your Board will be communicated, and resources will be allocated to help educate the community on our position.
The OHPOA board is also planning a “Town Hall Meeting” for members of the community, where both “pro” and “con” positions to Incorporation will be made – so you have all the facts necessary to make your mind up on this important issue. The OHPOA board will communicate the date, time and location for this meeting as soon as it’s determined.
Not sure where these facts are comming from but I lived in Palmetto Bay Fl when it was incorporated. Lower taxes, better police and fire protection and higher property values resulted. These are all verifible facts.
Property Owner and soon to be resident of Hammock Beach
incorporation issue & Mr. Milo
Mr Milo has come up with some numbers that I have not heard even remotely suggested.I have attended several meetings regaring incorporation of the Hammock. I have never heard of a 16% increase in property taxes (actually the proposed increase is $250 per million of value), and no one has suggested that we "grow" a bigger, or more complex, governing body (perhaps a "town manager" and a part time assistant).
Perhaps Mr. Milo could be more specific on exactly what we might expect based on "our" need to protect our identity, and the tremendous revenue prospect of the water system and the toll bridge that we would control, not to mention the ability to have zoning authority.
Mr. Milo seems to be yelling "FIRE" where there isn’t even any smoke…
I think that rental agents in the Hammock are afraid that the rules will change if we incorporate Lets see what the other side has to say at the meetings
For a guy that doesn’t live in Flagler Co or The Hammock area, Mr Milo seems to have strong feelings about how those of us most affected should react to Incorporation. Mr Milo’s motives need to be challenged. If he’s running for office or choosing to only represent his Cinnamon Beach rental customers, then he should resign from the POA Board for his lack of objectivity. Taking a unilateral and public position on this issue while serving on the POA Board is inappropriate.
Not in Support of Incorporation
I am sure that there are good arguments on both sides of this issue. I agree with many of the arguments put forth by Mr Milo, regardless of what his motives are. One thing that I know about "human beings" is that they all act mostly in their own "self-interest" All those for incorporation have many good arguments also, but, again, driven by their own self-interests. My opposition to incorporation is based on what I believe are two objective overriding reasons not to incorporate. First, Palm Coast could not involuntarily annex our properties. Milo is right, positive votes would be required on both sides. I don’t see much of a desire on the part of residents to vote for it.Second, and more important, any additional layer of government is an absolute negative and a financial burden. In this economic environment, municipalities are or should be finding ways to consolidate and reduce costs!!!
Am I missing something?? I can’t see an overridding objective reason to incorporate!!
Irresponsible Comments by Mr. Milo
I too question what Mr. Milos motives are in this matter. At any rate he is certainly acting in a very irresponsible manner by using his position on the Board of Directors to attempt to lend some legitimacy to his own personal opinion. As a Board member he should at least wait until the results of the various studies have been prepared before he starts advocating a position. He seems to want to run into the room screaming "fire" with all his made up numbers that bear no relationship to the situation at hand in an attempt to scare people into siding with his position. Mr Milo you should at least take your position on the Board of Directors off of your literature since the Board has not indicated a position on this matter yet and your putting it in your letter makes it seem as if it has.
‘Par’ for the course from what I hear
As a new employee and resident of the Hammock, its does not surprise me that all of the resident comments are against what Milo says and against what Taylor says. Both have incredibly negative reputations amongst the masses as self supporting and untrustworthy people. I, like others, prefer to hear the entire story and make a decision as a resident instead of an unfounded essay. As a manager of several like kind situations, I have not known the points mentioned to have precedent.