Fernandina Beach: Bad budget practices cause money to pile up and politicians scurry to spend it

For years, city officials in Fernandina Beach have allowed reserves in the building department to build dramatically. Rather than refunding the money or lowering the fees charged to builders and developers, they have gone on a spending spree to get rid of the excess.

In this year’s presentation on the building department budget, City Commissioners were told reserves were high but could not be easily refunded. They hired a consultant to analyze the high fees and determine where they should make reductions. 

What they did not say is that the fees have been high and the reserves have been growing — and they have increased spending dramatically to outrun the high revenues. These are not accusations, these are facts. 

At the end of fiscal year 2018-19, the reserve was more than $3.5 million and represented almost four times the annual expenses.

This is a clear demonstration that the building department was overcharging. They have known about the excess reserve “problem” for years. Any claims that this is a surprise or that they need time to address it are simply political rhetoric meant to confuse the public.

Instead of reducing fees or refunding them, it appears the department decided to spend, spend, spend. Expenses were projected to more than double from fiscal year 2019 to 2020. Instead they increased only 52%.  Why would expenses go up 52 percent year over year?  Better yet, who can get away with forecasting a 100 percent increase?  Permitting activity is relatively flat. The mayor’s support for “more aggressive enforcement” seems to be met with higher headcount, more trucks, more software, and on and on. 

So did the city figure it out and make the adjustments necessary?  It again looks like they plan on spending their way out of the excess. The 2021 budget for expenses is double the 2019 actual expense, which is incredible.

The 2020 reserve projection was off by $656,000. This means they are starting the new fiscal year with more money in the reserve than budgeted. 

The pattern continues: Higher starting fund balances, continued higher permit fees, and continued higher spending to try and outrun the excess revenues that they are charging via permit fees and fines.

All of this information is pubic record captured in a Freedom of Information request Public Records Request 2021-233.  Anyone can look at the detailed records.

Lowering fees would simplify development for residents and businesses and lower housing costs. 

The city manager and the city commissioners have seen this information presented in every budget cycle for years. Why do they allow this to continue?

This is not just about over-aggressive enforcement, higher fees, or the current building official, it is a pattern of bad budgetary behavior seemingly endorsed at the top.

It is time this situation is corrected. 

Jack Knocke, founder of Common Sense Fernandina is a business consultant and a resident of Fernandina Beach.


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