Lee County’s property values jump more than 8 percent…
May 3, 2016
Property values in Lee County moved higher over the past year, led by a increase of some $47 million in new construction compared to last year.
Fueled by an increase of more than $360 million in new construction, Lee County property values increased by 8.2 percent over the past year, increasing the tax base in the county by about $4.1 billion, the county property appraiser said Friday.
The taxable valuation in the county for the upcoming 2016-17 budget year is $66.791 billion, an increase of $4.1 billion, or 6.6 percent, over the current year. Taxable property is calculated by deducting exemptions and other non-taxable items from the total property value.
But the increase was less than Lee officials had been expecting. County Manager Roger Desjarlais said it means it may take more work to meet a directive from the board of county commissioners to cut the tax rate.
"At this point, we are off by a little more than $3 million," Desjarlais said. "We still have work to do if we are to have a reduction in the millage rate."
Desjarlais said the county had been relying on estimates from state revenue conferences that had projected an increase in Lee values of about 7.8 percent.
"We use them because they've been dead-on in the past," Desjarlais said.
At the current tax rate of $4.1506 per thousand dollars of taxable property value, the county could increase spending by about $15 million without increasing the tax rate, Desjarlais said.
Property Appraiser Ken Wilkinson said his department looked at property sales in the county during the 2015 calendar year.
Wilkinson called the findings "a good thing" for the economy of Southwest Florida, and said it does not reflect a repeat of the price bubble that burst in 2008, sending the economy into the Great Recession.
Bonita Springs' Spanish Wells Golf and Country Club in foreclosure
"I don't see it that way because we're over 50 percent of cash sales," Wilkinson said. "That is so different from what the original bubble was, that was built on credit that wasn't there, employment that wasn't there, mortgages that couldn't be paid."
The property values for individual buildings throughout the county are based on actual sales of comparable property during the 2015 calendar year.
Wilkinson said it is apparent there is some "flipping" of properties happening in the county.
A flip is when a property is bought at a distressed price, often due to a foreclosure, and then quickly resold at market value. The appraiser's office uses only the second sale of a property within a six-month period unless there is evidence both sales were at full market value.
Valulation figures will be adjusted before property tax rates are set by the 91 taxing jurisdictions countywide. Work in coming weeks will finalize the more complicated tax valuations for commercial and industrial property. The final totals need to sent to the state by July 1.
In addition to the county, the new property valuations affect Lee's six incorporated communities and 84 other taxing districts. The figures mean the agencies can spend more before increasing their tax rates.
Here is a look at the impact on the major taxing entities in the county:
Property values in Fort Myers continued to soar for third consecutive year.
Lee County’s hub is expected to see one of the highest jumps compared with other municipalities, with an estimated 8.44 percent increase in taxable value of property citywide. That represents nearly $420 million more in the city’s tax base, representing the increase from $4.9 billion last year to an estimated $5.3 billion for the 2016-17 budget year.
Taxable value on new construction in the city also is expected to increase by $14 million.
“That’s very encouraging news,” Mayor Randy Henderson said, “and consistent with economic indicators.”
Henderson said the expected increases are predictable and indicative of work put into infrastructure and curb appeal projects over the last decade.
“If we have it nice, people will come here to live, work and play,” he said. “It’s not guesswork, it’s the fruits of our labor.”
The city planned for a 7.5 percent increase in taxable value, said Christine Tenney, the city’s budget manager. The larger increase than expected would mean more tax collections that city officials were planning on.
The estimated 8.44 percent increase would produce an increase of nearly $45 million in revenue, Tenney said. That figure is based on the current tax rate of $8.77 for every $1,000 of taxable value.
Henderson said he’d like to use that money to strengthen law enforcement and public safety, as well as continue to focus on the city’s public works by investing in water, sewer, roadways and technology.
Officials also would like to dedicate money to expanding the downtown security camera network – which was a result of last year’s Zombiecon shooting – to other areas of the city, he said.
– Cody Dulaney
Cape Coral’s growth is projected to continue at a healthy 6.6 percent in taxable value for 2016. The preplatted community’s growth toward full build-out is expected to include $737.5 million in increased taxable property value in 2016. That is fueled, in part, by $184.8 million in new taxable, construction value.
Cape Coral City Manager John Szerlag said growth will lead to an additional $6.1 million for its general fund for the coming year, which is slightly higher than the city had projected.
“It’s always good news to have a good, healthy local, regional and national economy,” Szerlag said.
Randy Thibaut, CEO of Land Solutions Inc., said there is “pent up” demand for housing in Cape Coral that is fueling growth for the city of 170,000.
“You’re seeing new life coming and a demand for Cape Coral,” Thibaut said. “Because so many Naples and Estero people have been priced out of the market, so they’re looking to find the $300,000 and below. There’s very little of that out there.”
– Frank Bumb
The property valuation increase projected for Bonita Springs was the largest by percentage of any of the six incorporated communities in the county.
Bonita's valuation of just over $9 billion represents an increase of 8.5 percent over valuation used in the current fiscal year.
"The desirability of Bonita Springs as a community and as a place to live is reflected in these numbers," said City Manager Carl Schwing.
New valuation figures represent an estimated $500,000 in revenue for the city, but Schwing said no decision has been made on how to use it.
"We typically wait to finish up our revenue projections until we get these numbers," Schwing said. "It's not just revenue, it's the council's priorities as well."
Bonita's seven member council includes four new members elected in March. The city manager said he has been given a clear direction on the new council's priorities.
"They've made it very, very clear that the number one priority in the city, number one, without a doubt, unanimously, is transportation," he said.
– Bill Smith
With limited area available for new construction and several large parcels remaining raw land while new development rules are written, valuation increase for Estero was lower by percentage than rest of the county.
Estero's valuation increased by $316 million to just under $6 billion, an increase of 5.6 percent.
"It's right about where we estimated it might be," said Village Manager Steven Sarkozy. "We're pretty close to build-out, so there's less opportunity."
Sakozy said Estero is in the early phases of developing its budget, so impact of the increase will be evaluated as the package is crafted.
Next budget year will be Sarkozy's first in Florida and the second full-year budget for the village.
– Bill Smith
Fort Myers Beach
Fort Myers Beach, with estimated taxable property values topping $3 billion, is continuing a post-recession upswing, said Anita Cereceda, town council member and its most recent former mayor.
Cereceda called the estimated 6.7 percent increase in taxable value over last year’s final figure “excellent."
“The secret of Fort Myers Beach is out: There are many, many properties – commercial and residential – redeveloping here.”
Although Cereceda worries another unsustainable real estate price bubble could arise, for now she’s concentrating on positive aspects of rising valuations.
Older, longtime homeowners looking to downsize are better able to sell profitably, and perhaps get a nice condo inland.
Further, “because we have so many projects on our plate right now, (a higher taxable valuation) is a good thing for the town.
“And, even if we had no projects, it creates a greater sense of security in a community.”
– Laura Ruane
Sanibel’s preliminary 2016 taxable value of nearly $4.7 billion is 4 percent higher than the 2015 final value of about $4.5 billion. It’s the smallest percentage increase of any Lee County municipality.
Mayor Kevin Ruane – no relation to this reporter – wasn’t surprised. He likened buying Sanibel property to investing in a blue-chip stock that has less price volatility.
When the national recession hit in 2008, Sanibel property values suffered less than the rest of Lee, Ruane said, noting: “If you don’t go down so much, you can’t go up as much.”
The mayor cautioned against putting too much stock in a preliminary estimate. Sanibel previously has seen significant percentage increases in valuations between preliminary and final reports.
Two of south Lee’s fire district’s led the way when it came to property value increases.
Bonita Springs Fire Control District values increased 8.1 percent and San Carlos Fire Protection District had 7.1 percent gains. Estero Fire Rescue finished with a 6.1 percent increase.
They weren’t alone, however. All 16 districts saw increases, even the Tice Fire District, which includes the area just east of Fort Myers, had a 6.2 percent increase. Tice faced hard times during the Great Recession when property values fell.
Bonita’s increase was no surprise to those working for the district.
“I think it shows a positive increase in the economy. It shows Bonita is growing like we suspected. It’s positive for the community, and it’s positive for everyone around here,” said Greg Dewitt, assistant chief at the fire district and District 2 council member.
He said the district plans to spend the money on its stations.
He said many of these plans have been in the works for years but were delayed by the economic downturn of the late 2000s.
“When the recession came, we put a halt on any capital improvements,” he said. “Over the last couple years with the positive uptake the economy and property values, we’ve been trying to play catch-up with those items.”
He said another improvement in the future will be replacing their decade-old Air-Pack system firefighters use to breathe in smoky conditions.
“We’re going to be responsible with the taxpayers money like we have in the past,” he said. “Any growth we have will be smart growth and responsible growth.”