Pinellas To Dip Into Rainy Day Fund

By CARLOS MONCADA The Tampa Tribune

Published: Jun 18, 2007

CLEARWATER - Pinellas County's $146 million "rainy day" fund for emergencies such as a severe hurricane will be used to help the county weather a different kind of storm: one over escalating property taxes.

County officials plan to use part of the $146 million socked away in the county's contingency reserve fund, the largest among Tampa Bay area counties or cities, to help offset property tax cuts mandated by the Legislature this past week.

Pinellas administrators and commissioners consistently have defended the fund's size as appropriate for the vulnerable, densely populated coastal county in the event of a natural disaster on the scale of Hurricane Katrina. Some critics, including Florida Tax Watch, contend the county has stockpiled more money than it needs.

Gov. Charlie Crist weighed in on the subject this past week. Without singling out his home county of Pinellas, Crist suggested local governments have been hoarding their tax windfall rather than using it toward taxpayer relief.

"There are some of these counties that have reserves that are extraordinary," Crist said. "They are not banks; they are local governments."

Pinellas Commissioner Bob Stewart agreed the county might be setting aside too much in reserve, saying, "It's got to come down."

Pinellas has accumulated the money over several years as real estate values climbed. Of the $163 million in additional property tax revenue the county has collected since 2003, 68 percent has been set aside as a hedge against a natural disaster.

The nest egg comes to 21 percent of the county's general fund, easily the highest percentage among several urban counties including Hillsborough, Miami-Dade and Broward, an informal survey by The Tampa Tribune found in March.

The tax package that state lawmakers passed this past week will require Pinellas to cut its property tax revenue by 7 percent, which Stewart said translates to about $32 million. Besides tapping into its reserve, the county is looking at personnel and service reductions to bridge the expected budget gap, he said.

"We're trying to find a level of comfort," Stewart said, referring to the amount in reserve. "We'll take some money out of there, but I just don't know how much."

Although County Administrator Steve Spratt called the $146 million in reserve a prudent amount, he agreed "it can probably go down somewhat."

"It's sort of a roll of the dice; how much risk do you want to take with lower reserve levels," Spratt said at a recent budget meeting.

To help justify the amount in reserve, commission Chairman Ronnie Duncan and Commissioner Ken Welch asked Spratt to put together cost estimates the county would face if it were struck by a Category 4 or 5 hurricane.

Reporter Carlos Moncada can be reached at (727) 451-2333 or cmoncada@tampatrib.com.