JACKSONVILLE, Fla — Economists predicted Jacksonville will be in the top 10 U.S. cities to fall into the more severe scenarios in 2021.
According to a National Tax Association study, the City of Jacksonville will likely lose more than 12% of the revenue it would have seen in the 2021 fiscal year without the pandemic. The authors argue it could have serious consequences for city residents and local economies such as cuts in public safety, education, sanitation and other services provided by local governments.
“I think certainly that parks and recreation are probably the first place they'll start cutting, but also you can look at projects like roads and bridges," economy and finance expert Mickey Cargile explained.
He said other than cutting back services or putting a hold on projects, cities can also fight back on the deficits by borrowing money or pulling from an emergency fund, which the city has done already to fund it’s COVID-19 Relief Program.
“It is something that's very important right now for the community leaders to take hold of, and make sure they don’t overspend -- and conserve every dollar that every dollar that they can," Cargile said.
Jacksonville's finance department is preparing for some losses, but it said property taxes are rising in both fiscal year 2020 and 2021.
In a statement to First Coast News, the City of Jacksonville said half of its tax revenue each year is property taxes. Those taxes are up 3% to 5% due to rising home values and new development.
The city said it is budgeting for an 8% decline in sales tax for the coming year, but also added that there’s been a “strong recovery of consumer spending” in Duval County in recent months.
“Once we get the vaccine in place, once there are additional therapies to treat the disease -- I believe that the economy is going to come back stronger than ever," Cargile explained.
The City of Jacksonville's full response to the National Tax Association study is below.
"We do not see revenues declining by that magnitude for two primary reasons:
- While we are budgeting for an 8% decline in sales taxes for the coming year, Jacksonville has actually seen a very strong recovery of consumer spending in the county to pre-COVID levels in recent months.
- This has been helped by our proactivity in getting stimulus measures out to the citizens faster than most other cities.
- Half of our tax revenues are property taxes, which are actually up 3%-5% in each FY 20 and FY 21 due to:
- Value of homes continuing to rise
- New development that has far exceeded our expectations as the net migration of people into northeast Florida continues to take advantage of our relatively lower cost of living and lower taxes than other areas."