County budget could take unanticipated $10-million hit

A judge’s ruling last week and an unexpected move by the Florida Legislature, before it adjourned March 9, could prove extra challenges to the county financial outlook, Sarasota County Commissioner Nora Patterson told about 150 members of the Siesta Key Association during their annual meeting March 10.

First, she pointed out, the judicial ruling had overturned the Legislature’s move in 2011, at the urging of Gov. Rick Scott, to require all government employees to pay 3% of their salaries into the Florida Retirement System.

“That gave (the county budget) a bit of a break last year,” she said, noting that employee contributions to pension plans were “not a novel idea.”

Patterson told the audience, “My guess is most of you in the room contributed 100% to your retirement (plans).”

An appeal of the judge’s ruling was expected, she said. In the meantime, it would mean “probably a $5 million to maybe a $6 million hit to the county budget, not once, but every single year,” she said, along with a refund to employees for their pension payments to the state.

The second action, which she characterized as “incredibly unfair, but (which) will be quite devastating to our budget,” was the Legislature’s move to make it impossible for counties to avoid paying Medicaid bills that they could prove to be unsubstantiated.

Patterson explained that each Florida county has been responsible for Medicaid bills for any person who has provided a home address in that specific county. However, if county staff were able to prove the person had provided a false address, such as a sidewalk or the county jail, she said, the county did not have to pay the bill.

“And now we have to pay about a $5 million check,” she said, “and, again, a recurring bill that will be ever increasing … ”

She added, “I am outraged about this.”

Counties will be able to appeal that legislative action to a state board, Patterson said. Still, if the counties lose, she said, they will be paying 100% of what state officials say they must pay in Medicaid bills, regardless of whether counties can prove that some claims are invalid.

A third factor that could have a significant bearing on future county budgets, she said, relates to a referendum the Legislature has approved for the November ballot: Voters will have the opportunity to decide whether to lower the ad-valorem property tax cap on non-homestead property from a maximum increase of 10% a year to 5%.

“So think carefully about this one before you go to the polls,” Patterson added, pointing out that the county had lost 40% of its tax base since the recession hit, and another 4% decrease has been forecast for the 2013 fiscal-year budget.

Nonetheless, Patterson said, the No. 1 beach designation for Siesta Key, bestowed in May 2011 by Dr. Stephen P. Leatherman, “almost seemed to signal a change in attitude” and, at the same time, the beginning of an economic rebound for the county.

In past years, Patterson said, Sarasota County reaped a number of national honors. Then, when the Great Recession hit, the community began to struggle. The No. 1 beach recognition, she pointed out, has been followed recently by Sarasota’s being named the top spring-break destination for families by www.livability.com and the best place to retire by www.topretirements.com.

Patterson also pointed out that the county’s unemployment rate had declined from a level above 13% at the height of the Great Recession to its current rate below 10%. “I never thought I would celebrate an unemployment rate in the area of as high as 9.8%,” she said, adding, “It’s great to see it go down, (but) it is still unacceptable.”

The County Commission was doing the best it could, she said, to try to improve employment opportunities in the county.

“We are seeing that most county residents support (economic) incentives to try to diversify our economy,” she added.