Who’s going to pay $3B for fixes?
Officials say Fort Lauderdale is due for a costly overhaul
FORT LAUDERDALE — Fort Lauderdale is aging — from the pipes to the roads to the sidewalks to the bridges to the buildings. And overhauling all of it will cost at least $3 billion, city officials say.
Everyone from property owners to renters paying utility bills will be burdened with the tab.
At a workshop Wednesday, city leaders started the difficult discussion of how to collect an extra $3 billion over the next 20 years.
Property taxpayers could see tax rates increase for the first time since 2006, officials warned. Water and sewer customers already pay higher rates every year, but the increases could be even larger. Stormwater rates for flooding prevention also are expected to increase.
In addition, the city might ask voters in March to tack on an additional property tax to pay for $250 million in parks projects and a new police headquarters.
“How did we get to this point where the police station is so far gone? How did
we get to the point where the sewers are so far gone?” asked Ed Kwoka, a management consultant company owner who sits on the city’s infrastructure task force.
The financially grim news is the result of years of neglect or lackluster maintenance in the 107-year-old city, particularly during the Great Recession that started 10 years ago, city officials said.
“We kind of lost a lot of our buildings,” Commissioner Robert McKinzie said.
“Fort Lauderdale was not the only city. It’s been throughout the country where the sanitary sewers were not maintained,” said Ralph Zeltman, a former utilities worker and a member of the infrastructure task force, which was convened after unprecedented raw sewage spills in Fort Lauderdale waterways. “It was out of sight, out of mind.”
The workshop, a joint meeting of the task force and City Commission, laid the groundwork for next year’s decisions about raising taxes and fees.
Here’s how the $3 billion breaks down, and who might pay it:
Water-sewer upgrades: $1.4 billion. Already, $200 million has been borrowed to start the most critical work. Utility rates go up 5 percent each year, which should pay for the first 10 years of the 20-year project schedule. More needs could be identified, though. Also, a rate study is under way that could result in higher costs for customers.
Stormwater, or flooding prevention: About $1 billion. For now, the city isn’t sure how this will be paid. Commissioners will decide in the coming months whether to increase rates to cover it. Stormwater fees are found on the monthly utility bill. The rates went up 25 percent last year to $10 a month for a residential property, but that wasn’t nearly enough to cover the tab. Condo residents likely will pay more than they’re used to paying, under a hybrid model that takes into consideration the traffic to and from a property, rather than just the surface area of the land.
New City Hall and police headquarters: $300 million. The city and county are in talks about construction of a city-county government center, and it could include a new police headquarters. The current headquarters, built in the 1950s on Broward Boulevard, would be demolished. There has been talk of a public-private deal involving public land downtown, but for now, the funding of the projects is unknown.
Parks projects: $150 million. The projects haven’t been identified, but City Manager Lee Feldman said commissioners must decide by mid-December whether to ask voters in March to raise their property taxes for the work. He said voters could be asked to support a $250 million bond for the parks improvements and a $100 million new police headquarters. Feldman was fired Tuesday night and leaves at year’s end.
Roads, bridges, public seawalls and sidewalks: $125.4 million. The city will use gas taxes, stormwater fees and general tax dollars for these projects. A property tax increase could contribute toward this work. If the city raises its property tax rate, it could collect an additional $35 million for every extra “mill.” One mill equates to a $1 in property tax, charged on every $1,000 of property value. A one mill increase on a $300,000 house, for example, would raise the tax bill $300, plus any increase from a rise in property values.
Feldman said the city also should start considering building a broadband network for high-capacity computer data transfers, in order to stay competitive to businesses.
“You need to be looking at the infrastructure for the future as well,” he said. “You don’t want to put yourself in catch-up mode there, too.”
City commissioners will discuss the potential parks police bond issue at their Oct. 23 meeting.
“You can’t nickel and dime your way out of this problem,” said Marilyn Mammano, a former member of the New York City Planning Commission and chairwoman of the infrastructure task force. “… These are painful decisions.”