West Palm Beach first imposed a fire fee on its residents and businesses in 2008. Ever since, city leaders have talked about hiking it. At $25, it generates big bucks for the city – more than $2 million last year. And like a goose that lays golden eggs, city officials keep shaking it for more.
Now the city’s finance director has proposed boosting the fee for residents to $85, more than triple the current rate. For businesses, the fee would more than triple as well. It’s not the first time city officials have suggested such a grand money grab. In 2010, then-Mayor Lois Frankel wanted to raise it to $100. She was shouted down then, and city officials deserve to be shouted down again.
Fire assessment fees have their place, but they are a poor substitute for direct taxation. The main way that property owners support city government is through property taxes, which are transparent, progressive and evident to anyone looking to buy a home or invest in a city. Homebuyers can compare properties in different towns with relative ease. In West Palm Beach, the current tax rate is $8.55 per $1,000 of taxable value.
This is precisely why city governments love fire fees, just like they love sewer fees, garbage fees, and most any other kind of fee. They’re not reflected in the property tax rate. City commissioners can hike fees and still go out and tell residents that taxes didn’t go up. Fee hikes attract less attention, and they are more difficult to track. They’re stealth charges, municipal government’s version of the bank overdraft fee.
Not that all fire fees are awful. Modest ones that truly supplement fire services or pay for construction of new fire-rescue facilities can be appropriate, particularly when cities have a legitimate financial need. In Lake Worth, the city’s narrow lot sizes leave it with a high number of homeowners who pay no city property taxes because their homes’ values are less than the $50,000 homestead exemption. There, proposals for a fire fee in 2011 were reasonable to ensure that all residents contributed something to the costs of running the city. (Even so, city commissioners there eventually nixed the proposal).
West Palm Beach officials are bracing for a projected $8.4 million budget shortfall in the next fiscal year. To fill it, commissioners can raise taxes and cut back spending. In other words, they can do it the old-fashioned way. Fire fees, once increased, have a habit of never going down again. On the other hand, the high-profile nature of property taxes means elected officials are always motivated to lower them. That’s how it’s supposed to work. There’s no reason why West Palm Beach can’t balance its budget without exorbitant fee hikes.
for The Post Editorial Board