Res No 172-17-14973RESOLUTION NO. 172-17-14973
A Resolution of the Mayor and City Commission of the City of South Miami
endorsing a reduction of the millage rate for the City following completion of
annexation of proposed areas.
WHEREAS, the City intends to propose the annexation of the High Pines and Ponce
Davis areas; and
WHEREAS, the City Commission recognizes the proposed annexation appears to
provide very specific benefits to the current residents in the unincorporated areas; and
WHEREAS, the City Commission recognizes the importance of being proactive in
developing a greener, healthier, aesthetically pleasing, dynamic, vibrant, and cosmopolitan
community; and
WHEREAS, the City Commission recognizes that a slight millage rate increase for the
properties in the areas to be annexed, will be offset by a significant and tangible increase in a
highly efficient community-based police service, including a dramatically reduced response time
when compared to the current times being typically recorded by the County police service; and
WHEREAS, the City Commission has noted that additional benefits to those being
annexed include, better trash service, better code enforcement, park spaces and programs, highly
responsive staff and City Commissioners who are easy to reach; and
WHEREAS, the City Commission projects an increased ability to access more grants for
the entire City due to a larger population base, as is often important when competing for grant
funding; and
WHEREAS, in order to facilitate the annexation of the High Pines and Ponce Davis
areas, and to be fiscally conservative and responsible to its current, as well as its potential future
residents in those areas, the City Commission desires to express its intention to lower its millage
rate.
NOW, THEREFORE, BE IT RESOLVED BY MAYOR AND CITY
COMMISSION OF THE CITY OF SOUTH MIAMI, FLORIDA, THAT:
Section 1. The City Commission hereby recognizes the importance of encouraging the
residents of High Pines and Ponce Davis to become annexed into the City of South Miami and
that there will be a net increase of funds available for City services based on the significant
additional value of the properties in the proposed annexed areas.
Section 2. The City Commission further affirms that it is likely, and is projected, that the
full amount of revenue increase based on the proposed annexation will be more than the amount
currently projected by the City to meet the needs of the current City residents and business
Page 1 of2
Res. No. 172-17-14973
community as well as the residents of the High Pines and Ponce Davis areas.
Section 3. The City Commission further resolves that it be the policy and intent of the
City of South Miami to reduce the millage rate from the current rate of 4.3000 to 3.45 in the fIrst
year after the annexation is complete.
Section 4. Severability. If any section clause, sentence, or phrase of this resolution is for
any reason held invalid or unconstitutional by a court of competent jurisdiction, the holding shall
not affect the validity of the remaining portions of this resolution.
Section 5. Effective Date. This resolution shall become effective immediately upon
adoption.
PASSED AND ADOPTED this 15 th day of August, 2017.
APPROVED:
COMMISSION VOTE: 4-1
Mayor Stoddard: Yea
Vice Mayor Welsh: Yea
Commissioner Harris: Yea
Commissioner Edmond: Nay
Commissioner Liebman: Yea
Page 2 of2
THE CITY OF PLEAS A NT LIVING
To:
FROM:
CITY OF SOUTH MIAMI
OFF ICE OF THE CITY MA NAG ER
INTER-OFFICE MEMORANDU M
The Honorable Mayor & Members of the City Commission
Steven Alexander, City Manager
DATE: August 15, 2017 Agenda .Item No.: Add-on a)
SUBJECT: A Resolution formally stating the intent of the Mayor and Members of the City
Commission to reduce the millage rate following annexation of certain areas.
BACKGROUND:
In February of 2017, the City Commission discussed inquiries from some residents of the
High Pines area regarding their i nterest in receiving a Preliminary Annexation Feasibility
Report indicating South Miami's i nterest and approach to the potential annexation of the
areas. The Commission's Resolution No. 030-17-14831 directed the City Manager to
explore and engage the process of annexing the unincorporated High Pines & Ponce Davis
neighborhoods and craft a prelim i nary feasibility assessment process.
The Preliminary Annexation Feasibility Report reflects a refi nement of the revenue and
cost information, as well as, creating a document to assist with the assessment of the cost
of services and programs to be provided and to evaluate the level of neighborhood support
for annexation into the City of South Miami.
High Pines and Ponce-Davis:
Figure 1 provides an aerial view of the High Pines and Ponce-Davis neighborhoods. These
areas encompass 675 acres and are generally situated southeast of the intersection of SW
72 Street (Sunset Drive) and SW 57 Avenue (Red Road) and share a border with South
Miami along SW 57 Avenue (Red Road) from SW 72 Street (Sunset Drive) to SW 88th Street
across from Dante Fascell Park. The population is estimated to be 4,128 with
approximately 3,096 voters. The population i s 31% Hispan ic and 65% Caucasian (non-
Hispanic). High Pines has approximately 756 single family homes, while Ponce-Davis has an
estimated 169. The average household income is $158,367 a n d 78% of the housing units
are owner-occupied . The land use pattern in High Pines and Ponce-Davis is decidedly
single-family residential comprising 95% of the neighborhoo d . There are also 28 acres of
multi-family residential and f ive acres of commercia l property. These two neighborhoods
have approximately 20.5 miles of paved roads combined.
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THE CITY OF PLEASANT LIVING
CITY OF SOUTH MIAMI
OFFICE OF THE CITY MANAGER
INTER-OFFICE MEMORANDUM
High Pines & Ponce -Davis Neighborhoods
Legend
• Parks
I. Ri vil:ra Park
2 . Dantt! Fil scdl Park (City of South Miami)
3. Rd Road Linear Park
.... Ba nya n Drive P;..rJ,;
5. Hammock luke Park
6 . Matheson Hammock Coun ty Park
-Higb Pines Neighborhood
-Ponce -Davis Neighborh ood
Schools
A . Rivicrin Dny Sc hool
B. Child C lfe Center Inc .
C. Bilingual Coopctolli vc: Preschool
O . unse t Element ary School
E. Our Lady of Lords Academy
F. Epiphany Sc hool
G. 5 1. Thomas Episcopal Parish School
Figure 1
Page 2 of9
THE CITY OF PLEASANT LIVING
CITY OF SOUTH MIAMI
OFF!CE OF THE CITY MANAGER
INTER-OFFICE MEMORANDUM
High Pines Only Annexation Scenario
• Benefits of Annexation for the City: The High Pines neighborhood, if annexed, is estimated
to generate an estimated net revenue surplus to the City after expenses of $1,594,083 for
2018 based on the increase in property tax revenue only using the millage rate adopted for
FY 2016-17 and the taxable values provided by Miami-Dade County for 2016 for High
Pines.
• Currently, High Pines residents and owners within the proposed annexation areas are
subject to a millage rate of 1.9283 mills. Annexation at the current City of South Miami
millage rate of 4.3000 will increase the annual property tax bill of residents and owners
within the proposed annexation areas by 2.3717 mills. It is critical to note that this new
millage rate includes South Miami's Solid Waste collection service, therefore, if annexed,
the residents of High Pines will no longer have to pay the County $464 each year for the
County Solid Waste collection service. Property taxes are typically deductible on IRS Form
1040 and the County imposed solid waste fee of $464 is not. Therefore, since South
Miami's property tax bill includes solid waste service, the homeowners in this area will, in
theory, be able to deduct (save) more property tax than currently.
• Based on the median average of the 2016 taxable value of homes in High Pines ($398,597),
the resulting estimated net annual impact on a typical property tax bill in the annexation
area of High Pines is approximately $481 per year. This figure is arrived at by taking the
typical property tax bill in the annexation area of High Pines of $945 per year and
subtracting the County solid waste fee $464 per year which will no longer be charged of
High Pines residents after annexation, $945 -$464 = $481.
• Should the City wish to reduce the millage for all of the residences due to the annexation
of the High Pines Annexation, the City may reduce the South Miami millage, possibly to
3.3000, without affecting City services. Under this scenario, High Pines would realize an
approximate net increase of $83 (after eliminating the County solid waste fee) on their
property bill and fees on a median average 2016 home price.
• Revenues: The primary revenue sources will be from property taxes, which are estimated
to generate a total of $2,867,083 based on the current City of South Miami millage rate
and the taxable assessed values provided by Miami-Dade County for 2016 for High Pines.
The total estimated revenue from all sources are estimated to be $3,191,945 million
annually from the High Pines neighborhood, including Municipal Sharing Sales Tax and
Communication Service Tax and various other taxes such as Franchise Fees and Utility
Taxes similar to currently imposed by Miami-Dade County.
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THE CITY OF PLE ASA NT LIVI NG
CITY OF SOUTH MIAMI
OFFICE OF THE CITY MANAGER
INTER-OFFICE MEMORANDUM
Both Neighborhoods Annexation Scenario:
Financial Impact Based .on Both Neighborhoods
In addition to other property taxes, residence in the subject neighborhoods currently pay
an Unincorporated Municipal Service Area (UMSA) tax rate of 1.9283 mills, plus 2.4207
mills for the County Fire District service. A "mill" is defined as $1 for every $1000 of
property value. If annexed into the City, these areas would begin to pay the City's
property tax rate of 4.3000 mills, and continue to pay the 2.4207 mills for County Fire &
EMS service. This combination of taxes produces an estimated increase of millage on tax
bills, if the neighborhoods become part of South Miami. Currently 1.9283 mills, plus
2.4207 mills is levied on the two neighborhoods by the County but under the South
Miami annexation the tax levies would be 4.3000 mills plus the 2.4207 mills for County
Fire & EMS service if annexed by the City of South Miami.
It is important to put these municipal tax rates into a context showing the real estimated
financial impact of annexation on neighborhood property owners. Using the current
South Miami millage rate of 4.3000, an estimated median average 2016 home price in
High Pines of $398,597 and an estimated median average 2016 home price in Ponce-Davis
of $1,536,577, the resulting annual estimated impact on property tax bills for High Pines
and Ponce-Davis areas will experience a median average increase in High Pines of $945
(which is typically deductible on Federal taxes). When factoring in the elimination of the
County imposed fee for solid waste collection, the following net increases result for the
two neighborhoods: ($945 property tax -$464 County solid waste fee = $481 net
increase) and in Ponce Davis of ($3,644 (which is typically deductible on Federal taxes)
($3,644 property tax -$464 County solid waste fee = $3,180 net increase) on their taxes
and fees.
Revenues and Expenditures:
As shown in Table 1, the annual estimated revenues for the High Pines and Ponce-Davis
area are expected to exceed City services and program costs, based on the City's current
millage rate of 4.3000.
Table 1: Estimated Revenues and Expenditures* for Fiscal Year 2018
Total Revenue/Costs High Pines & Ponce-Davis
Operating Revenue $4,561,151
Operating Expenditure 1,273,000
Annual Operating Net Difference 3,288,151
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THE CITY OF PLEASANT LI VING
CITY OF SOUTH MIAMI
OFFICE OF THE CITY MANAGER
INTER-OFFICE MEMORANDUM
• Note: Excludes capital outlays and improvements, which may be added
subsequently. Neighborhood capital improvement p r ojects are typically agreed
to by the neighbors prior to approval by the City Commission .
Financial Feasibility: The annexation of the subject areas is financially positive for the City,
as the City's projected revenues will exceed projected expenditures in the annexation
areas . If support from the residents of High Pines and Ponce-Davis appears to be strong,
and the City Commission endorses the proposal, once t he process of annexation is
ultimately completed, the City could lower its millage rate in the near future to reflect the
liet increase in revenues from the newly annexed areas.
Tables 2 and 3 of this report provide a yearly, detailed estimate of revenues and
expenditures for 2018, associated with the annexation of High Pines and Ponce-Davis.
For 2018, these neighborhoods are expected to generate an estimated revenue surplus
to the City of $3,288,151 ($4,561,151-$1,273,000 = $3,288,151) if annexed together,
based on state revenues and on the millage rate adopted for FY 2016-17 and the gross
taxable assessed values provided by Miami-Dade County for 2016 for High Pines and
Ponce-Davis.
Revenues: The total gross taxable property value of High Pines and Ponce-Davis are
$1,028,846,941, as provided by Miami-Dade County Property Appraiser's Office. The
current South Miami millage rate would be applied to this total gross taxable assessed
value to produce a projected ad valorem revenue of $4,202,840 . Potential City revenue
estimates are summarized in Table 2. The p r imary revenue source will be from property
taxes, which are estimated to generate a total of $4,202,840 (95% of ad valorem) based
on the current City millage rate adopted for FY 2016-17 and the taxable values provided
by Miami-Dade County for 2016 for High Pines and Ponce-Davis. The total estimated
annual intergovernmental revenues from all sources are estimated to be $4,561,151
from both neighborhoods, which also includes Munici p al Sharing Sales Tax and
Communication Service Tax.
TABLE 2: ESTIMATED REVEN U ES FROM ANNEXATION
Estimated Revenue Sources
High Pines and
Ponce-Davis
Property Tax (At 4.3000) (at 95%) $4,202,840
Sales Tax (Municipal Sharing Program) $268,253
Communication Service Tax $90,058
Total Estimated Tax Revenues $4,561,151
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THE CI TY OF PL EASANT LI VING
Fee Reduction:
CITY OF SOUTH MIAMI
OFFICE OF THE CITY MANAGER
INTER-OFFICE MEMORANDUM
It is critical to note a few facts related to the fiscal impact of annexation on the individual
homeowner. As of October 1, 2017, the residents of High Pines and Ponce-Davis pay a
Solid Waste Fee of $464 per year in addition to their ad valorem tax amount. Should the
residents of High Pines and Ponce-Davis decide to opt for annexation by South Miami,
they would be provided with Solid Waste Services from the City. Doing so will result in
the elimination of the requirement to pay the Solid Waste Fee of $464 per year in
addition to their tax bill, as South Miami includes solid waste collection service in the ad
valorem tax. Although the inclusion of Solid Waste service within the ad valorem tax of .
South Miami adds to the increase the ad valorem tax for the residents in the annexed
area, it also reflects a reduced expenditure by residents who are annexed for the solid
waste collection fee by the County (-$464). The net effect based on both neighborhoods
assuming the current City millage rate is $653 ($1,117-$464 = $653 ), a slight increase
(estimated average property tax increase for annexed home minus the County Solid
Waste yearly fee equals the new true financial impact for an average property in the
annexed area as it moves to South Miami). South Miami's solid waste collection is
second to none, as it offers twice-weekly automated garbage pickup with back door
service for those who need it, weekly vegetative trash removal (the county only provides
this service twice per year), and white goods removal on demand.
Estimated City Costs:
Table 3 below provides a summary of projected expenditures for necessary City road
and infrastructure improvements, new equipment, and personnel. The immediate
increased cost of providing services to this area would total an estimated $1,273,000
annually starting in 2018, in addition to a projected $2,260,000 initial capital cost, which
includes additional Police and Solid Waste vehicles for the area. This cost will not recur
from year to year.
The capital expenditures for this area are expected to decline in future years. Fire,
Water and Sewer, Planning and Zoning, and Building will have not experience any
significant budgetary or financial impact due to the proposed annexation.
Page 6 0[9
T HE CITY O F PLEASANT LI V IN G
CITY OF SOUTH MIAMI
OFFICE OF THE CITY MANAGER
INTER-OFFICE MEMORANDUM
Table 3: Estimated Expenditures by South Miami for Fiscal Year 2018, including Solid
Waste
City Services Annual Cost Capital Cost
Solid Waste $510,000 $625,000
Parks 100,000 775,000
Police 400,000 160,000
Public Works 200,000 675,000
Code Enforcement 63,000 25,000
Total Expenditures $1,273,000 $2,260,000
Initial New Expenditures and Services immediately after annexation
Solid Waste: Solid waste disposal is included in the CSM property tax, however, there is an
additional one-time capital cost of $625,000 for trucks.
Code Enforcement: Total estimated cost for an additional Code Officer annually is $63,000 for
2018 with an additional one-time capital cost of $25,000 for a vehicle .
Parks: As desired by the Community, $775,000 is estimated for park and open space renovations
at the medians of 76th St. & 54th Ave . Also, full "park like" renovations of those same areas, with
trees, plant new foliage, and shrubs, as necessary.
Street & Landscaping: Routine Landscape maintenance in the right of ways is estimated to be
$300,000 for 2018. Landscape services including tree trimming, and landscaping replacement, as
necessary.
Police: Additional Police expenditures are estimated to be $400,000 with a projected Capital Cost
of $160,000 for new vehicles and equipment.
Roadway: Lighting, improvements, and maintenance of roads in these neighborhoods are
estimated to be $200,000 annually to include the re-milling of deteriorated streets, installation
and renovation of sidewalks, and installation of crosswalks, as determined in the City Budget.
Directional Signs: The City would install the new decorative directional street name signs on each
of the intersections for an estimated $300,000 for High Pines and an additional $75,000 for the
Ponce Davis neighborhood.
Fire: Fire Rescue will continue to be provided by Miami-Dade County at no change in cost as the
result of annexation.
Page 7 of9
TH E CITY OF PLEASANT LIVING
CITY OF SOUTH MIAMI
OFFICE OF THE CITY MANAGER
INTER-OFFICE MEMORANDUM
PROPOSED OPERATIONAL EXPENDITURES
4 Police Officers (Approx. $75K x 4) $300,000
4 Police Officers Expenses ($25K x 4) $100,000
Total $400,000
3 Solid Waste Staff ($55K x 3)
MDC Recycling
Tipping Fees
Solid Waste Supplies and Gas
Total
Parks Staff and Special Projects
FPL Street Lights
Street Repairs and Maintenance
Public Works Streets Staff
Total
Code Enforcement Officer
Code Enforcement Expenses
Total
Overall Estimated Annual Operations Total
4 Police Cars ($40K x 4)
Public Works Small Truck
Sanitation Dump Truck
Sanitation Crane Truck
Sanitation Garbage Truck
Capital
High Pines New Directional Signage
Ponce Davis New Directional Signage
Streets and Landscaping
Parks Small Truck
Parks
Code Enforcement Vehicle
Total Estimate Capital Costs
$165,000
$40,000
$250,000
$55,000
$510,000
$100,000
$50,000
$100,000
$50,000
$200,000
57,000
6,000
63,000
$1,273,000
$160,000
$25,000
$100,000
$200,000
$300,000
$300,000
$75,000
$300,000
$25,000
$750,000
$25,000
$2,260,000
Page 8 of9
TH E CITY OF PLEASAN T LI V IN G
CITY OF SOUTH MIAMI
OFFICE OF THE CITY MANAGER
INTER-OFFICE MEMORANDUM
OPTION IF ANNEXATION AREAS ARE APPROVED
Millage rate reduction
The City could reduce the millage for all its current and newly annexed residents and
businesses, due to the increased revenues reSUlting from the annexation of the High
Pines and Ponce-Davis. Under one example the City could reduce the millage to 3.3000,
including the newly annexed areas . Under this scenario, High Pines and Ponce-Davis
would benefit from a lower millage rate than the City of South Miami is currently using.
Based on this hypothetical example of a new millage rate of 3.3000, the annexed areas
would have a reduced property tax impact, and therefore, based on a 3.3000 millage rate
for the City, the hypothetical net increase for High Pines would be $83 ($547 -$464 = $83
) and in Ponce Davis of $1,644 ($2,108 -$464 = $1,644 ).
RECOMMENDATION: It is recommended that the attached resolution be approved which
provides that it is the policy and intent of the City of South Miami to reduce the millage
rate to 3.3 in the year following the completion of the annexation process.
ATTACHMENTS: Proposed resolution
Miami-Dade County Property Appraiser's 2016 Taxable Assessed Values
Page 9 of9
MIAMI-DADE COUNTY
PROPERTY APPRAISER
2016 Values for Davis-Ponce and High Pines
APRIL 28, 2017
Davis-Ponce and High Pines Values
Values are from the 2016 Preliminary Assessment Roll
Davis-Ponce Area Area
Use Count Just Value Assessed Taxable
Single Family 169 445,649,854 322,842,919 315,983,419
I nstitutiona I 1 2,405,183 2,164,606 0
Vacant Land 11 13,066,413 11,006,316 11,006,316
Other Properties 1 1,000 1,000 1,000
All Real Property 182 461,122,450 336,014,841 326,990,735
Personal Property 1 8,495 8,495 0
All Assessed Property 183 461,130,945 336,023,336 326,990,735
High Pines Area
~Use Count Just Value Assessed Taxable
Single Family 756 859,158,736 594,713,357 556,837,215
Condominium 311 52,008,703 43,257,998 37,816,462
Townhouse 80 79,279,813 66,470,872 64,470,372
Duplex 7 8,338,847 5,800,124 5,550,124
Multi Family 1 752,481 508,300 508,300
Commercial 11 16,583 ,733 14,981,649 11,422,206
Institutional 3 56,779,737 54,576,763 0
Governmental 1 17,491,664 14,444,834 0
Vacant Land 39 30,711,285 25 ,969,051 24,944,575
Other Properties 7 0 0 0
All Real Property 1,216 1,121,104,999 820,722,948 701,549,254
Personal Property 42 751,169 751,169 306,952
All Assessed Property 1,258 1,121,856,168 821,474,117 701,856,206