|Ocala, FL -
August 2, 2012|
Published in Ocala Star Banner Thursday, August 2, 2012 at 1:58 p.m
As Marion County property values diminish year over year, the financial ripples could affect Munroe Regional Medical Center.
Earlier this summer, trustees who oversee the 421-bed hospital approved a referendum that will go before voters in November.
The referendum would allow the Marion County Hospital District to issue up to $65.37 million in bonds and charge property owners a maximum of 1 mill annually for five years. One mill represents $1 in tax for every $1,000 a property is worth, minus homestead exemptions.
But as property values decline, some trustees fear the 1 mill won't generate the $65.37 million they had hoped for.
Trustees decided during their meeting this week to invite bond experts and county taxing officials to help estimate how much 1 mill would generate over the five years.
If the county's taxable property value keeps dropping as it has, at an average of about 7.7 percent annually, the hospital could fall well short of what it was hoping to collect.
Each year the Marion County Property Appraiser's Office determines the county's taxable value. From that, tax collecting entities can estimate the amount they will collect in property taxes.
Since 2007, the county's taxable worth has been falling steeply. For 2012, the county's preliminary taxable value was $13.9 billion. In 2007 it was $22.3 billion. This year's drop was less than expected: a 6.7 percent decline.
If the county's past five-year trend continues and property values continue to fall, that 1 mill tax, if approved by voters, could generate only about $55 million — $10 million short of expectations.
The public hospital is owned by the state-sanctioned Marion County Hospital District and overseen by seven trustees who are appointed by the County Commission. The trustees currently lease the hospital to Munroe Regional Health System, Inc., which is overseen by a 13-member board, some of whose members also are district trustees.
For several years the hospital's expenses have been greater than the revenue generated from patients. During lean years it has survived due to its savings and Wall Street investments, but it has been warned by its economic advisers that it can't continue as it has and still hope to expand to remain competitive.
Trustee Joseph Hanratty was the first one Monday to call for county and bond officials to come and speak to trustees about tax expectations.
The tax can only be used to buy new hospital equipment and capital improvements.
"We made all of our assumptions on $65 million," Hanratty said during the trustee meeting.
Richard Mutarelli, Munroe executive vice president and chief financial officer, warned that predicting the county's taxable value for the coming years is impossible.
"We're not going to know in the future. The county is not going to know the numbers any more than we do today," Mutarelli told trustees.
Mutarelli said that whatever the amount the tax generates, the hospital will use it as intended. If the amount falls short, some projects may not be built and some equipment might not be purchased.
"Everyone in the county has to be flexible," he said.
Trustee general counsel Jon Dean said getting more data on the financial potential of the tax would be a good thing.
"Let's get the experts in and talk about the bonds," he told trustees, "and lets see how the math works on it."