A public hearing will be conducted Wednesday, Sept. 28, by the Mehlville Fire Protection District Board of Directors on a proposed 2011 tax rate of 69.7 cents per $100 of assessed valuation.
The public hearing will take place at 5 p.m. at the district’s headquarters, 11020 Mueller Road, Green Park.
Board of Directors Chairman Aaron Hilmer told the Call the district’s proposed 2011 “blended” tax rate of 69.7 cents per $100 is 1 cent less than the maximum the district can levy. The “blended” tax rate is not levied, but used for state calculations. The proposed 2011 tax rate is 3 cents more than the current rate of 66.7 cents per $100.
At press time, district officials were awaiting confirmation from Missouri Auditor Tom Schweich’s office on the proposed 2011 tax-rate calculations.
District voters in April 2009 overwhelmingly approved two propositions reducing the fire district’s tax-rate ceiling by a total of 40 cents.
Proposition 1 asked whether the district’s general-fund tax-rate ceiling should be permanently reduced by 36 cents per $100 of assessed of valuation while Proposition 2 asked whether the district’s pension-fund tax-rate ceiling should be permanently reduced by 4 cents per $100.
Approval of the two propositions has resulted in the district not being able to collect nearly $10.5 million in tax revenue annually, according to Hilmer.
Hilmer and board Treasurer Bonnie Stegman first took office in April 2005 after running a campaign in which they pledged to eliminate fiscal waste and roll back Proposition S, a 33-cent tax-rate increase approved in November 2004.
Voter approval of the two tax-decrease measures made permanent what the board had been doing on a voluntary basis since it set the the district’s tax rate in August 2005, essentially rolling back the 33-cent Prop S increase. At that time, the district’s tax-rate ceiling was $1.22.
As proposed, the 2011 tax rates for the general, alarm and pension funds are: 62.5 cents, 3.4 cents and 3.8, cents respectively. In April, district voters overwhelmingly approved Proposition S, which consolidated the district’s general fund and ambulance fund into one fund, eliminating the ambulance fund.
The current rates for the general, ambulance, alarm and pension funds are: 39.5 cents, 19.2 cents, 4.2 cents and 3.8 cents, respectively.
In a related matter, the Board of Directors also will consider approval of a preliminary 2012 budget that projects revenues of nearly $19 million with anticipated expenditures of more than $18.6 million. Approval of a final 2012 budget will be considered by the board in December.
The preliminary 2012 budget projects revenues of $18,978,288 with anticipated expenditures of $18,636,470 — a surplus of $341,818.
The current budget anticipates revenues of $18,947,446 with projected expenditures of $21,033,000 — a deficit of $2,085,554. The district will not go into the red, but will dip into its reserves.
The projected deficit for 2011 results from the purchase of land for a new No. 3 Firehouse and the construction of that firehouse, according to Hilmer.
Of the preliminary 2012 budget, he said, “… We’re very proud of it. This will be the seventh tax rate — believe it or not — since Bonnie and I were elected in 2005 that we’ve set and what a roller-coaster ride since then. But this is the first budget for the upcoming year where we’re not using any money for building projects. (During) the last six years, we’ve brought the entire district up to 21st century standards — either through renovation or just brand-new construction.”
Three new firehouses have been constructed and the new No. 3 Firehouse at 4811 S. Lindbergh Blvd. is under construction.
“So I’m glad to say and to tell the public, we’re done with major building projects,” Hilmer said. “But I’m also even happier to say and also proud that we’ve done all of those without indebting the public at all. We’ve never had to borrow money. There’s no interest costs associated and we’re done with building projects. There is no legacy debt. There were no underwriting fees for bond issues, interest, any of that stuff. We’re all done with that.
“… We’ve taken quite the path from 2005. When Bonnie and I got there, the district was sitting on no reserves and was projecting a tax-rate increase,” he continued. “We immediately did not take that tax-rate increase and over the next few years we built our reserves up fairly substantially. And after doing that, we identified building projects that needed to be done and then we used the money we had saved and did those building projects at a great time for the district to do it. So we’re really proud of that. The one big capital expenditure in this year, we’ve budgeted $760,000 for a replacement fire truck.”
The preliminary budget for next year also includes a slight raise for most employees as 2012 will be the final year of a three-year salary schedule adopted by the Board of Directors in December 2009.
“… A lot of times, especially when it comes to public entities, they can be really murky or opaque. When you look at the Mehlville Fire District, for instance this 2012 budget and tax rate, what you see is exactly what you’re going to get,” the board chairman said. “You can look on our website (
) and you can see exactly what every employee at the fire district makes. You can look on our website and see every expenditure the fire district made.
“And I want to point out something that I think’s a huge thing, that especially the public’s becoming more and more aware of, is our pension. We’re spending a little less than a million dollars this year. We’re going to put $962,000 in.
“That’s basically what the pension fund takes in and that’s what goes into the employees’ 401(k) accounts … If someone asked me: What are your pension costs? Well, it’s very clear. Employees get between 8 and 11 percent of their salary put into their account. That’s it. That’s their account. It’s portable. They can invest it how they want, but there is no legacy cost to the district. And I think that’s the biggest thing. In this era of these public entities, they can never tell you exactly what their pension costs are. We are completely transparent and I think it’s a great model.”
The preliminary 2012 budget also includes $300,000 for the district’s now-terminated defined-benefit pension plan and $50,000 for the sick-leave reserve fund.
“Now these were two programs that were created before Bonnie and I came there,” Hilmer said. “Quite frankly, they were promises made. The money never existed to be able to make them whole, but what we did is we stopped these from going on. But obviously, we have to pay the people what they were promised. So we’re having to take money to put it there for future costs that come up … That is something we’re going to be looking at every year going forward is probably taking some money and putting it into the old pension plan and the sick leave fund.”
The preliminary 2012 budget projects the district will collect more than $2.2 million in revenue from ambulance billing.
“… Some things that did come up over the past year, we went through another election cycle in the district and there was a lot of talk about eliminating ambulance billing,” Hilmer said. “If you look at this budget, we’re going to receive $2.2 million in ambulance billing on a balanced budget. So if a person claimed they were just going to eliminate ambulance billing, while that sounds great, we would need an extra 10 cents from residents in order to provide the services they currently receive …
“It was just a lie that you could stop it,” he said, citing the flat revenues projected a result of a continued decline in the district’s assessed valuation — hence the need to roll up the tax rate.
“Assessed valuation went down, so we rolled up to stay revenue neutral,” he said. “I have no issue with that because when Bonnie and I were elected, the tax rate was supposed to be $1.22. We chopped it down to roughly 59 cents and because of declining assessments, had to roll it up.”
The proposed 2011 tax rate of 69.7 cents still will be the lowest of any fire district in St. Louis County, Hilmer said, adding, “This is the sixth year running for that.”