Most taxes from Bay Medical will go to CRA
PANAMA CITY — Adding Bay Medical Center Sacred Heart Health System to the county’s tax roll will generate more than a million dollars in tax revenue for local governments next year.
But, Bay County coffers will see only about $69,000 of the newfound money.
The lion’s share — $754,000 — will go to the Downtown North Community Redevelopment Agency (CRA), more than doubling the agency’s annual budget each year for the foreseeable future. At least one county official argued the windfall would be better spent throughout Bay County, while city officials said concentrating the funds to the one area would be more beneficial.
At this point, though, it doesn’t matter what anyone thinks, because distribution of the money already has been determined.
Preliminary numbers released by Property Appraiser Don Sowell show placing Bay Med on the tax roll will add about $98 million to the total taxable property in Bay County, ranking third on the list of highest taxable values in the county.
“At one time they (commissioners) considered it an advantage because the county would get the money,” said County Commission Chairman George Gainer. “My biggest objection was it wasn’t written down.”
Gainer was the sole dissenting vote when the county approved a 60-year lease of Bay Medical in February 2012. At the time, Gainer said: “The dullest pencil is better than the sharpest memory,” he said.
Contract
When Bay Med went private, county officials did not draft a contract outlining where county tax revenues of about $366,000 and city tax revenues of about $388,000 would go. Without a contract, the default automatically routes the sum as Tax Increment Financing (TIF) funds to the Downtown North CRA.
“The property taxes make up our tax base, and that’s what we use to pave roads and do all the county functions,” Gainer said. “In this case, that money goes into the CRA and is not allowed to spread out through the county.”
TIF funds are generated by property value increases after a certain baseline date. In Panama City, these dates are the respective beginnings of each CRA. Though Bay Med was chartered in 1949 as Memorial Hospital of Bay County, it was public and not subject to city or county taxes because it was not-for-profit. When Bay Med became private/for-profit, the value of the entire structure and the tangible property within became taxable.
The injection of tax dollars will more than double Downtown North’s revenue of $539,982.70 for next year. The district, established in 1993 and spanning an area from U.S. 231 and East Avenue to Glenwood to Beach Drive, already draws in the most revenue of the four CRAs. It also has the largest carried forward funds of about $1.7 million, though it is the second latest CRA created in Panama City.
“The district is massive compared to other areas,” said William Whitson, CRA director. “It is going to naturally generate more TIFs, and we are starting to make headway in the area.”
Dollar commitments are strictly designated to the CRA district of which they originated, according to state law — even when one district greatly outweighs another in revenue. Bay Med revenue into the Downtown North district will make its annual income nearly five times that of the Downtown CRA, the oldest and most revenue poor of the four CRAs with about $260,000 incoming in 2012.
At least the county will not walk away empty-handed, as each year it will receive about $69,000 for taxes on equipment within Bay Med.
Not affected by TIF is the Bay District Schools district, which will get a total of $818,000 in new money from taxes on Bay Med. Of that amount, $618,000 is classified as “required local effort,” which means the state determines how it will be spent; how the remaining $200,000 will be budgeted is up to local school district officials.
Funding plans
Infrastructure needs, such as sidewalks, water, sewer, streetscapes, a master stormwater plan, as well as community police, code enforcement and development of the African-American cultural corridor, were cited as possible expenditures for the funds.
“It’ll give us the ability to do more things and have more things on the table knowing we are getting more money,” said Mayor Greg Brudnicki. “It gives you the backing to plan for things you otherwise wouldn’t be so bold to plan for.”
Brudnicki said the city wants to work with the county on mutually beneficial projects.
“We’re still going to work with the county and there are going to be things we both want done,” Brudnicki said. “Those opportunities are going to cross our paths in the future, and it doesn’t mean it is not going to benefit the county.”
Whitson agreed the funds would benefit both parties as the county and city jurisdictions overlap.
“I would not say from our perspective the county lost out,” Whitson said. “This is our opportunity to do projects and lift these areas up.”
Specific plans for the additional money will be designated during the budgeting period in the fall.
“It’s done now and we have to make the best of it,” Gainer said. “I’ve got every reason to believe it will work and we want to be part of their success and wish them the best of luck.”
County and city TIF revenues for Panama City CRAs in fiscal year 2012:
Downtown (created 1984): $259,703 (carry forward – $410,900)
Downtown North (1993): $539,982.70 ($1,658,817.28)
Millville (2004): $272,557.25 ($446,229.14)
St. Andrews (1989): $358,502 ($119,733)
Total exempt value of property in the county as of April 15 was $4,830,610,528. Areas within Panama City but outside CRA districts’ property tax revenues go to the county or city general fund.
Growth From 2011-2012:
– Downtown CRA grants and vouchers increased by 802 percent from $25,000 to $225,594.
– Downtown North CRA grants and vouchers decreased by 13 percent from $75,000 to $65,000.
– Millville CRA grants and vouchers increased by 113 percent from $30,000 to $70,000.
– St. Andrews grants increased by 88 percent from $32,000 to $60,000.
Top property tax payers in Bay County as of Jan. 4, listed by taxable value:
1. Gulf Power Company: $249,419,234
2. St. Joseph Land & Dev. Co.: $150,082,684
*3. Laketown Wharf Marketing: $66,622,640
4. Pier Park, LLC: $65,882,365
5. Smurfit Stone Container: $62,076,590
6. Arizona Chemical Co.: $46,164,001
7. Marriott Ownership Resorts: $42,061,767
8. Hilton Company/Gac/Gulf Asphalt: $38,027,243
9. Gulf Coast Electric Coop: $37,650,347
10. Wyndham Vacation Resorts Inc.: $36,482,818
*Bay Med would rank third on the list, at $98 million
Breakdown of Bay Med Tax Dollars
Real Property (county and city revenue goes to downtown north cra)
-County: $366,000
-City: $388,000
-School District Required Local Effort: $520,000
-School District Discretionary: 168,000
-Northwest Florida Water Management District: $4,000
-County Mosquito Control: $15,000
Tangible Personal Property Tax
-County: $69,000
-City: $73,000
-School District Required Local Effort: $98,000
-School District Discretionary: 32,000
-Northwest Florida Water Management District: $757