Saturday, October 8, 2011

Fire Fee Still fires up citizens in Palm Bay

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It's no surprise that a potential fire fee that is not off the table, yet, keeps coming up in council meetings. At a time when most of our residents are hurting financially, the last thing we ever need is an added expense to add insult to injury.

As unemployment continue to rise, the price of food increasing, home values continues plummeting, and foreclosures and short sales becoming the norm in the real estate industry, many residents are making sure that an additional fee is neither added on their utility bill or tax bill without their consent, first. One Palm Bay citizen demanded that a letter be sent out telling people what the fire fee is for.

Council Member Ken Greene said that "the fire fee is not for the pension," which already has the tax-payers in the hole for $50,000,000 and will continue to rise by over $80,000,000 as pensioners are promised at least 100% of their salaries at retirement with cost-of-living adjustments which can certainly put many of these bloated pensions over the top, and push residents (as well as small business owners) over the edge. Make no mistakes, the fire fee is considered for the purpose of paying the pensions either directly or indirectly. However you want to put it, the fact that a pension fund is out of control and growing, and more money is being sought by fleecing residents indicates that an ever-growing problem isn't going away, and the answer seems to be simply to find new forms of revenue - according to three sitting council members.

Even a report by the Finance Department admitted that additional cuts will have to be made over the next 2 to 3 years just to build an emergency reserve fund which we don't have right now.

Please keep in mind that there will be a phone town hall meeting toward the end of October concerning the fire fee. I encourage all to attend, as the message need to resonate in the minds of our elected public servants that they need to adhere to the people and the charter.

Wednesday, September 7, 2011

Take, Take, Take!!!

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Take, take, take... is how one Palm Bay resident put it. Like an unquenchable fire, City Council (with the exception of Council Member Isnardi) agrees to raise the tax rate to $9.00 per $1,000 - making it a 97% increase from just five years ago when the millage rate was 4.6 in 2007. In addition to this, about four fees were considered for increases. Among them  was the fair share impact fees, which affects development and improvements in our city. Council Members Michelle Paccionne, Ken Greene, and William Capote (Deputy Mayor) voted for all increases.

I was glad see some new faces at the meeting, as residents came to speak out against the tax rate increase and the potential fire fee that is still on the table as Council is awaiting the ($50,000) study.

The biggest problem, as Mayor John Mazziotti and Council Member Kristine Isnardi continue to expose, is the pension fund which is potentially $50,000,000 in the whole and will leave tax-payers having to pay for the unfunded mandate.

As it seems, for now, there will be NO road work for one year, and it would appear that most tax payments (i.e. going to Palm Bay) is primarily going to pay salaries and pensions, while services pertaining to infrastructure diminishes.

It is as I said before, the road to serfdom, where the few benefit at the expense of the many. And while our home values continue to diminish, our jobs become few, and energy and food prices rise; the majority on City Council keep saying, "TAKE, TAKE, TAKE!" 


Friday, September 2, 2011

Is Palm Bay Scaring Away Businesses and Jobs?

When President John F. Kennedy was elected, he was faced with a dilemma: a declining national economy, rising unemployment rates, and budget deficits. So what did he do? He dropped the top marginal tax rate by 22% and deregulated industries. The result was phenomenal, as not only did government revenue grew by over 62%, but unemployment shrank as the private sector grew.

In President Kennedy's own words:

"... an economy hampered by restrictive tax rates will never produce enough revenues to balance our budget just as it will never produce enough jobs or enough profits… In short, it is a paradoxical truth that tax rates are too high today and tax revenues are too low and the soundest way to raise the revenues in the long run is to cut the rates now."

History repeated itself, once again, when President Ronald Reagan also inherited an economic nightmare, as well. Again, the action taken was even more sweeping tax rate cuts which increased total tax revenue by 99% in the first year of his administration, and income tax revenue, alone, increased by 54% by the end of his term.

How can these lessons from the past, help us in Palm Bay? One issue that our city suffers from is a dismal commercial base in comparison to our neighbors (e.g. Melbourne) and lack of a thriving downtown. The results are less commercial ad-valorem tax base and the majority of the tax burden laid on the shoulders of residents to provide most of the revenue.

So, how do we attract more businesses to Palm Bay? While I agree that reducing the property tax rate is a great way to attract more home buyers and businesses, alike; I think we also have to look at the message we're sending to businesses, with the fees we expect them to pay on their way into our city.

Look at Ordinance 110.44 Receipt Tax Schedule, for example. Here you see the bigger a business' commercial building, the more money that business has to pay to our municipal government. But it doesn't stop there, the more employees a business takes on, the more it also has to pay in fees. The message is quite simple: If you move your business to Palm Bay, expand your operation, and provide more jobs, we'll take more money from your pockets.

Also, take a look at Ordinance 171 Fair Share Impact Fees, as another example. While the intent of Florida Statute 163.3161 “Local Government Comprehensive Planning and Land Development Regulation Act,” says it is "necessary so that local governments can preserve and enhance present advantages; encourage the most appropriate use of land, water, and resources, consistent with the public interest; overcome present handicaps; and deal effectively with future problems that may result from the use and development of land within their jurisdictions." 

The three Impact Fees (i.e. Park Police, and Fire Impact Fees; Transportation Facilities Impact Fees; and Water, Waste Water, and Water Impact Fees) of our municipal ordinance meets these objectives by "... requiring all new impact generating land development activity to contribute its proportionate share of the funds, land, or public facilities/equipment necessary to accommodate any impacts on public park, police and fire facilities/equipment having a rational nexus to the proposed land development for which the need is reasonably attributable to the proposed development." These impact fees can be as high as $957 for a single family unit. No where in the Florida Statute do I see fees as a necessity to "encourage the most appropriate use of land, water, and resources, consistent with the public interest," as stated in the Statute.

After all, if new edifices are to be constructed in our city, the property taxes incurred by businesses and home owners on the land purchased and their improvements, as well as the new business activities that will come as a result of those new constructions will most certainly pay off in the long run - increasing the long-term revenue stream of our local government. A subtle but long-term revenue increase will allow the City of Palm Bay local government to grow in proportion to the growth of population and revenue in a more steady pace while stabilizing or reducing local property taxes, rather than growing exponentially off the explosive revenue from fees that may last a year or two but wain over the next decade, or so. We've seen this happen from the year 2005 to 2007, where new departments were created, more employees were hired, bigger salaries given, and luxurious pensions were handed out - all at our expense - in the hopes that the same level of growth is maintained. However, when the market tanked, it's a lot harder to take the toy away from the child than it is to give it away.

If Palm Bay were to eliminate these fees, we wouldn't be the first to extend a helping hand to new comers and developers. Wakulla County is eliminating impact fees, all together. The reason, as some of the commissioners stated, " the amount of money a large commercial business would have to pay is reason enough not to come to that place... I want to remove every obstacle there is for commercial growth. I want to see commercial growth in this county, whatever it takes to get them here." The article goes on to say, "Those in favor of eliminating the impact fees argued that growth pays for itself in the form of other taxes."

In Texas, The City of Bullard, is also eliminating impact fees, as well. As one council member said, "Bullard is considered a hot spot for development, but he believes the fees associated with building cause development to go around the city instead of inside it."     

At a time of high unemployment (and foreclosures as a result), it is imperative to find new ways to encourage new market activities in our city, get people back to work, reduce spending and tax rates, and prioritize revenue towards infrastructure. Raising taxes and inventing new fees will only chase away both businesses, and along with them, jobs.

Wednesday, August 31, 2011

More people losing property for late tax payments

Florida Realtors® News

Daily Briefing: Wednesday, August 31, 2011
A service for members of Florida Realtors

Article Quote: "In the first nine months of this year, the owners of more than 200 properties in Hillsborough County have lost them in “tax deed sales,”... Who’s buying them? Often, it’s financial heavy hitters such as a JPMorgan Chase subsidiary and a former Massachusetts hedge-fund manager."


If you haven't done so, by now. Take the poll on the upper left hand corner. Thank you.

Tuesday, August 30, 2011

Suit aims to rid Palm Bay residents of stormwater fees

Article Quote: "It's a mess. It's basically a regressive tax... The people with small houses on small lots are paying the same as big houses on big lots."


Also, if you haven't done so, yet. Take the poll at the upper left hand corner.

Monday, August 15, 2011

When Did Public Servants Become Our Masters?

Below are three, very short, videos concerning the impending dangers looming on the horizon for every State, County, and Local governments across the fruited plain of America. It will make your head spin!

It used to be when anyone wanted a good paying job, he or she would go to either a trade school or college, receive a certificate or degree, and go work for a company in the private sector or start a business. It was hard work, it was competitive, and if you walked away with a six figure salary at the end of the day it was well deserved. After all, you would be paid what you're worth according to your ability to produce; and if you didn't work, you didn't get paid.

Take my grandpa, for example, after being honorably discharged from the U.S. Army after serving four years in combat missions during the Korean Conflict, he went to trade school and became a Licenced Master Electrician. He and another Veteran opened up their own electrician business. With hundreds of small and mid-sized business clientele, they made a pretty good living and build their own retirement. They finally closed their doors after almost 40 years of business. My Grandpa passed away a few years ago and received a formal military burial ceremony for serving his country with honor.

Another example is my wife's grandpa, who for over 40 years worked as a full-time maintenance man for a private land lord, owned and rented some homes of his own, and also had a painting business on the side. Today, he lives comfortably on an island in the Caribbean, with only the money he has saved up all those years.

I bring up these two examples because this used to be the norm for many past generations. They worked hard, paid their taxes, saved for their own retirement, and never complained about what they were left with after all those years of hard-toil. With the good Lord and good health, they were the masters of their own destiny and earned their keep.

However, all of that has changed, today. The recent Wall Street bubble and Real Estate bubble left many Americans with the euphoria that the good times were here to stay, and not only did greedy speculators capitalize on the artificial bubble, but so did government unions, all over America.

At a time when we're experiencing record unemployment rates and economic uncertainties in light of the fact that for the first time in the history of our nation, our bonds have been downgraded , one would get the sense that governments will be making similar cuts as private sector jobs are, right now. Unfortunately, and much to the chagrin of many hard-working taxpayers, that is not the case.

According to the U.S. Department of Commerce, from 1989 to 2009, government spending increased 66% to over five trillion dollars - federal, State, and Local. Much of that increase came in the way of higher salary and pensions that have spiked significantly in the six figures - in some cases over a half million dollars a year with free medical benefits and cost of living adjustments. Not bad, when you're the founder and CEO of a competitive company that provides goods that everybody voluntarily purchase without being forced against their will. But when it's a government worker making these exorbitant salaries and bloated pensions at the expense of taxpayers, and they have their own lobbyists and elected members making sure they get all the sweat heart deals; some how I get the feeling that people aren't voting with their feet, anymore.

Friday, August 5, 2011

Residents Voice Their Concerns

For those who didn't make it out to the August 4th Council Meeting, here are some highlights. A lot of great comments and good points were made. Enjoy!

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Monday, August 1, 2011

Why I’m running for Palm Bay City Council Seat 2

After living in New York City for almost 30 years, I realized that I was economically burdened by the following:

  • High taxes and more than one kind of taxation
  • Numerous and out-of-control fees
  • An ever-growing and corrupt local bureaucracy without accountability
After the birth of my son, Antonio, I looked at several towns around America where me and my wife can raise our children and have the economic freedom that we haven’t experienced in the big city. That’s when we found the City of Palm Bay… and we fell in love with this town. We were attracted to the sunny skies, the lush vegetation, the beach and fishing recreation, the mixture of rural areas and small town neighborhoods, and the low taxes – relative to where we lived.

Unfortunately, and much to our chagrin, we find the same elements that turned our previous home into an expensive, crime-ridden city taking root in our city: Increasing property taxes, new fees to grab revenue, and a high-salary, big local government. If we continue this course, we will lose our city and quite possibly our homes.

As your new City Council Member I will bring the following decisive agenda to our City Council:

  • Lower property tax rates
  • No new fees and No old fees that are designed to grab revenue
  • A balanced budget every year
  • A smaller and limited government that will provide essential services at top quality with a renewed focus on infrastructure (e.g. roads, sidewalks, etc…)E
  • Eliminate red-light cameras
  • Look at city ordinances which may be a burden to property owners and businesses
  • Let The People Vote! Abide by the City Charter and allow the people to decide if they want to pay more for services or projects.

I know that I will be only one of five Council Members, but I believe these things can happen with firm leadership, persistence and most of all, your help. I hope that you will lend me your support and help me get elected in November 2012 for Palm Bay City Council Member Seat 2.

I will be making frequent updates and sharing more on facebook as well as the release of my website.

Thank you and God Bless.

Harry Santiago Jr.

Monday, July 25, 2011

Let The People Vote - Part 3!!!

In the last blog I wrote, "Let The People Vote - Part 2," I mentioned how Council Member Kristine Isnardi rightfully pointed out the potential legal danger of an excessive fire fee being implemented without the consent of "We The People." If you haven't read it, there's a short video where she explains this, briefly.

Mayor John Mazziotti - one of the members of City Council opposed to this fire fee along with Kristine Isnardi - was recently interviewed in Florida Today saying that cuts and re-prioritizing the budget is a solution to the economic woes that the City should consider, but a $300 fire fee "is not workable." Kudos to the Mayor and Kristine Isnardi who have been champions in this fight against excessive taxation.

We should remember that such an excessive fee along with a spike in property tax can not only send tax-paying residents packing, but can also further cripple our local economy - on top of the quagmire we're experiencing from Washington and Tallahassee. It's bad enough that we're about to lose a few thousand employees county-wide due to the space shuttle program being shut down, but how much more fuel can be thrown in the fire with this absurd revenue-grabbing fee that only serves the purpose of the few at the expense of the many.

So far, the poll on the top left side of the blog has over 80% of Palm Bay residents eager to vote those Council Members, who vote for this outrageous new tax, out of City Council. But no other venue has really exhibited the frustration of the hard-working tax-payers of Palm Bay than the new Facebook group called "Ax the Palm Bay Fire Tax." With well over 250 members - since the date of this blog - and growing rapidly, Palm Bay residents are venting there concerns of how this new tax will affect their livelihood. the consensus is that residents don't want their taxes raised or a new tax (i.e. fee) implemented, but that City Council should look at cuts that should be made in light of these current economic times.

Every effort should be made, on behalf of Palm Bay tax-payers, to contact their City Council Members and let them know you feel about the new fire fee, raising property taxes, and not making any significant cuts that mirror the current revenue flow that is creating the kind of budget woes we're experiencing. 

If the people speak as one voice, we can deter this disaster awaiting to happen. The least City Council can do is to Let The People Vote!!!

Friday, July 22, 2011

City wrestles with budget woes

By Dan Garcia

PALM BAY - If you think there will be any fat in the proposed city budget for the upcoming fiscal year, you are mistaken, city officials said.

In preparing the upcoming 2011-12 budget, city officials said their budget is already based on bare-bones revenues.

Meanwhile, operating costs continue to increase, forcing the city to cut spending and raise the tax rate.

City studies charging residents a 'fire fee'

By Dan Garcia

PALM BAY - You may have to pay a "fire fee" to the city of Palm Bay - whether or not you ever have a fire.

Strapped for funds just like any other municipality, the city is considering imposing a separate fire fee that would help make up for a shortfall in tax revenue, city officials said.

Tuesday, July 19, 2011

Another ATF Arms Sales Scandal: 'Operation Castaway' by James Heiser

by James Heiser

The new scandal centering on the Bureau of Alcohol, Tobacco, Firearms and Explosives (ATF) makes it clear that “Operation Fast and Furious” was not the agency’s only program for putting firearms into the hands of foreign criminals. It is becoming clear that a second misguided effort to track arms sales to the Third World – “Operation Castaway” – ended up supplying weapons to criminals in Honduras and Puerto Rico which were used in violent crimes.

Operation Castaway – like its sibling, Operation Fast and Furious – began with the purported mission of decreasing the illegal sale of firearms. In the latter operation, the ATF’s Phoenix office used gun stores in the Southwest to track so-called “straw purchases” that placed firearms in the hands of foreign criminals. (In a “straw purchase,” a person, usually an American citizen, buys firearms with the intention of reselling them to individuals who cannot legally own them.) “Operation Castaway” allegedly operated in Florida with a similar mission, and ended in the same way: Rather than the "sting" operation being contained in a way that would have prevented the weapons from getting into the hands of foreign criminals, the firearms purchased in Florida flowed freely into Central America.

Tuesday, July 12, 2011

Most Residents Opposed To New Fire Fee

Fire fees proposal divides Palm Bay City Council

Palm Bay resident Lew Richards supports the work of firefighters and understands that the city's budget is stretched, but in belt-tightening times for many in the city, he won't get behind a proposed fire fee.

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Friday, July 8, 2011


Here we are, once again, demanding from our elected public servants the right that our forefathers have fought for and shed blood, sweat, and tears: LET THE PEOPLE VOTE!

Is there anyone else on our City Council that believes in the VOICE of the People other than Council Member Kristine Isnardi and Mayor John Mazzioti? Why not LET THE PEOPLE VOTE? Unless an individual on the City Council have a personal agenda that is against the will of the masses and in the best interest of the few. This most certainly takes the term "General Welfare" to a whole new level - more like "Specific Welfare." The people don't have a say in the matter, and that's that! Right?

The video below is only 13 minutes long:

Council Member Kristine Isnardi rightfully brings up Article VI, Section 6.02 of the City Charter which states:

"Before the governing body for the city may levy ANY special assessment involving more than fifty (50) property owners or involving a project expenditure of greater than twenty-five thousand dollars ($25,000.00), the proposed assessment must first be approved, in writing, by a majority vote of the affected property owners who return a ballot."

The key word as she intelligently points out is "ANY." If a $300 firefighters fee is imposed on the home owner's of Palm Bay it would be categorized under Non-Ad Valorum Assessments, which is defined under Florida Statutes, Title XIV, Chapter 197.3632, as:

(d) “Non-ad valorem assessment” means only those assessments which are not based upon millage and which can become a lien against a homestead as permitted in s. 4, Art. X of the State Constitution.
(e) “Non-ad valorem assessment roll” means the roll prepared by a local government and certified to the tax collector for collection.
Since "ANY" special assessment (that means ALL assessments) would fall under Non-Advolerum Assessment, then according to our municipal charter, the firefighters fee has to be approved by the electorate of Palm Bay.

Otherwise, imposing this fee without our approval would be illegal and nullified and any collected fees would have to be returned to Palm Bay homeowners. (This process would cost the city even more money). Of course, if it were not a Non-Advolerum Assessment then it would simply be a voluntary fee that individual homeowners may or may not participate. 
The City Council voted, 4 to 1, for the proposed tax hike of 9.0 Mil (or a 20% increase). The $300 firefighters fee is tabled until legal opinion is obtained by the local circuit courts. Public hearing will be held on:

Tuesday, September 6, 2011 at 6:30 p.m., and then on
Thursday, September 22, 2011 at 6:30 p.m.

It behooves us to contact our elected public servants on the City Council before these dates and to attend these public hearings, as well. As Council Member Kristine Isnardi eluded to in the meeting, there will be many more foreclosures as a result of this tax increase/added fee which if it were not for this revenue-grabbing thievery, can save taxpayers hundreds of dollars a month and can go towards mortgage payments and actually keeping our homes, instead of losing them.


Harry Santiago Jr.  

Wednesday, July 6, 2011

Hefty Taxes For Palm Bay Residents

On July 7th our City Council will have a special meeting on just how high our tax-rates will go. Here are some examples:

Current Millage Rate         7.50        $19,432,409
Proposed Rate                  9.00        $23,318,891
Roll-Back Rate                 9.68        $25,072,731

Note: The word "Roll-Back" is a double-think speech designed to make you perceive that a higher tax rate in the face of declining home values is justified. (If you're willing to buy into this terminology, then I got some beach front property on Mars I'm selling if you're willing to pay into that, as well). It is simply an increase in our tax rates.

According to Brevard County Property Appraiser, our gross taxable value decreased by $744,004,478 (or 29%). I believe the real drop is much more than this because the decrease in residential properties is more than the decrease in commercial properties. This is illustrated on the Brevard County Appraiser's website. Property values in Brevard County has declined by 42% for all properties from 2008 to 2011.

Considering that Palm Bay's gross taxable value have decreased in one year by more than two-thirds of what Brevard County Total Properties' market value have lost in three years, I would say that Palm Bay residential properties are making a harder-than-usual decline. 

When you take into consideration Palm Bay's plummeting home values along with 10.5 percent unemployment and Kennedy Space Center laying off 1,900 people by July 22nd of this year, I think the last thing we should be talking about is raising tax rates and adding fees.

In fact, if we raise tax rates alone, in spite of the lower property values, it will cause six things to happen in Palm Bay in the next few years:

(a) Property values will continue to decline and then stagnate at a certain low

(b) Homeowners will leave and the city will depopulate

(c) Investors will prefer to risk their capital in other cities with lower tax-rates and less or no fees

(d) The lack of capital and new home buyers will continue to erode the city's economy and go bankrupt

(e) Businesses will pack up and leave causing massive unemployment

(f) Crime will exponentially increase

In case you think I'm exaggerating, this has already happened to other cities around the United States. Economist Dr. Stephen J.K. Walters and Historian Louis Miserendino wrote a paper for the Maryland Journal called "How To Make Baltimore A Superstar City" where these two gentlemen researched, what they called, "THE GREAT EVACUATION OF BALTIMORE... between 1950 and 2008" In this great analysis they compare Baltimore to two other cities that also saw massive depopulation, as well: Boston and San Francisco. 

In this paper they described how all three cities saw double digit declines in population, jobs, and exponential jump in crime. However, between the years 1980 and 2000, only San Francisco and Boston saw a major come-back in population, jobs, and falling crime, whereas Baltimore continued to do worse. The common denominator for San Francisco and Boston's success was lower tax rates. Baltimore raised tax rates, thinking that lower property values would compensate for the revenue-grabbing municipality. In fact, Dr. Walters make a great point, saying:

"Those who argue that property taxes “don’t matter much” frequently cite Baltimore’s
generally lower property values as an offset to the city’s higher tax rate. In a
world where property never decays, or where owners do not care about future returns
on their investments, this argument might have some merit; in the real world, it is nonsense."

It's actually quite simple: higher property values are a result of lower tax rates and lower property values are a result of higher tax rates. Now, add a fee to higher tax rates and you can kiss your "bedroom community" goodbye. As the declining property values erode home equity, so will renovations and upgrades diminish overtime. Real property equity is an integral part of an investor's credit establishment to further expand their operation - which in turn creates more jobs. Without the incentive of lower tax rates, the real job creators (i.e. private sector) will decide to take their capital elsewhere.

If City Council approves these higher property tax rates and added fees, then it will be a very, very long time before we'll ever see a real estate bounce in Palm Bay. Until then, we tax payers will get stuck with this heft bill.

Harry Santiago Jr.

Friday, June 24, 2011



Why not? After all, who would ever be opposed to the democratic process of allowing the people to decide how much money they want to spend on government? I know... crazy idea, right?

Especially when you know 3 out of 5 of your City Council Members want to raise your millage to what would be the highest in Brevard County at 9.875 per $1,000 of assessed value (dangerously close to the State allowable cap of 10 per $1,000). But that's not all, how about a possible $300 annual Fire Fee on top of your tax bill. Sounds unbelievable? Here is the audio below, it's about an hour and forty seven minutes, but considering that Council is about to suck you dry, you should really hear what they have to say:

William Capote, Michelle Paccione, and Ken Greene are about to pull magical rabbits out of their hats. They will attempt the unthinkable: to persuade the majority of Palm Bay residents that it is good to raise taxes and add fees in the midst of what most economic analysts are calling a depression. These three Council Members are about to commit a grave error that will economically crush our municipality and make Palm Bay a ghost town in a matter of a year or two if they decide to go along with this glorified theft.

One concerned citizen, Tres Holton, who you hear toward the end of the audio said that adding a fee even if the tax rates were dropped will cause many median priced homes to see an increasing impact more quickly than higher priced homes.

Here is what Tres means:

Let's say you have a house worth $120,000 in today's market. At 7.5 Millage you are paying $900 for your annual tax bill. Now, let's say your house losses 25% of it's value the following year and is assessed at $90,000. At a lower rate of 7.0 Millage you are paying $630 for your annual tax bill. That's $270 less than last year's bill (It's amazing how a half a millage can save you hundreds of dollars - I digress). It's called a wash or a roll-back. But now add a $300 Fire Fee and you pay $930 or $30 MORE than what you've paid last year. So here is how it looks:

Last year:

$120,000 X .0075 = $900 + $0 Fire Fee = $900

Next Year (assuming 25% Loss in Value):

$90,000 X .0070 = $630 + $300 Fire Fee = $930

Now, let's change it up a bit and say you own a $375,000 home in today's market. At 7.5 Millage you are paying $2,812.50 for your annual tax bill. Now, let's say your house also losses 25% of it's value the following year and is assessed at $281,250. At the lower 7.0 Millage you are paying $1,968.75 for your annual tax bill. That's $843.75 less than last year's bill. Now add a $300 Fire Fee and you still pay a much lower $2,268.75 or $543.75 LESS than what you've paid last year. So here is how it looks, again:

Last year:

$375,000 X .0075 = $2,812.50 + $0 Fire Fee = $2,812.50

Next Year (assuming 25% Loss in Value):

$281,250 X .0070 = $1,968.75 + $300 Fire Fee = $2,268.75

Here is a good question: How many $375,000 homes are in Palm Bay? My latest MLS search revealed "0" for the past year from the date of this blog; that is "None" or "Nada" (that's Spanish for nothing). In fact, within a year of the date of this blog, Palm Bay residential homes' median sell price is $68,900 (Brevard County's Median Home Price is $99,475) and just last year alone Palm Bay local real estate market lost over 10% of its value and will see another double digit dip this year as well, according to most real estate analysts.

So if Palm Bay homes are under the median home price for the County, and according to the example provided above we would still pay a higher tax bill even if the millage rate were lower and the fee added; how much more will we pay if the millage rate went up and a Fire Fee were added? What would it do to home values? What would it do to businesses? What would it do to jobs in the private sector? How many more families just scraping by and living paycheck to paycheck will lose their homes?

We are faced with food and energy inflation, devaluing dollar, mounting debt, skyrocketing foreclosure rates, unemployment rates in the 20th percentile by most analysts' real estimates, and declining wages; and now you can add an increase to your tax bill.

Mayor John Mazziotti and Council Member Kristine Isnardi suggested that the Fire Fee go to a vote by the people in a special election. For obvious reasons, the other three aforementioned above voted down that great democratic idea.


Harry Santiago Jr.

Wednesday, June 15, 2011

6/15/11 Budget Workshop Cancelled Fo No Reason

Below is an excerpt from an email from Kieth Rigler, Chairman of the Conservative Constitutional Caucus (CCC):

"Palm Bay has canceled to nights Budget Workshop, with no reason given. For now they say the Budget Workshops to be held on 6/23 and 6/30 will be held on those dates. Tomorrow night 6/16 there will be a regular council meeting, and I suggest we make some comments during the Public Comment time, at the end of the meeting, on the presentation given on 6/9. I will be getting a copy of it today and will pass it on asap. I can not understand how the City can start off with $11,000,000.00 short for 2011 and 2012, but our critical needs for the city is $5,000,000.00 of new spending."

It is important that we make to as many of these meetings as possible. It can make a big difference on next year's property tax.

Harry Santiago Jr.

Tuesday, June 14, 2011

US Housing Crisis Officially As Bad As Great Depression - CNBC

Here is a very interesting article that has everybody on edge. Now analysts believe that the housing market is going through a depression - and one greater than in the Great Depression of the 1930's. Here is excerpt from the article that I think sets the motif for what's to come:

"Prices continue to tumble despite affordability, which by most conventional metrics is near historic highs." Click on the link below and read more:

US Housing Crisis Officially As Bad As Great Depression - CNBC

There is no doubt in my mind that rising unemployment and dollar devaluation by the federal reserve is causing so many of these low-balled homes remain at a distance from deserving home buyers. During times like this, we need to start thinking out of the box - and for most things go back to the principles of our nation's founders.

Harry Santiago Jr.

The Economic Statistic US Elites Keep ‘Hush-Hush’ by Ron Robins

More on understanding our dire debt situation and how this can all fall on all localities in the U.S.

Stay informed... stay strong.


The Economic Statistic US Elites Keep ‘Hush-Hush’ by Ron Robins

Monday, June 13, 2011

Are Higher Taxes On The Horizon?

On June 9th our City Council held a special workshop to talk about the city's budget. It's usually in these special workshops where the precedent is set for very important decisions that affects our daily lives, and once again, another decision is about to made that I believe can hurt a lot of Palm Bay residents.

Concerned citizens showed up to hear the decisions of our elected public servants. One of them was the elected Chairman of the Constitutional Conservative Caucus, a local activist group dedicated to the principles of conservative limited government on the local and county level, Kieth Rigler, who noted some interesting details during the meeting.

One of those details was the admission of how the 2011's budget is already starting off with a $4,000,000 short-fall due to declining property values. No surprise there, since Brevard's three major cities have lost a combined 9.5% per quarter from 1st Quarter 2010 to 1st Quarter 2011. Most analysts believe the housing market has gotten worse and will only get a lot more worse before it gets any better. This brings us to 2012's budget short-fall which is estimated to be around $6,000,000 (i.e. $2,000,000 more than 2011).

But don't worry, they will fix it. Apparently there were talks of... wait for it... wait for it... You Guessed It: RAISING OUR TAX RATES! From 7.5 Mil to 9.5 Mil (which pretty much will make us the highest Mil in the county unless Satellite Beach beats us to the punch). And you thought government was all out of ideas. In fact, to add injury to insult, possible new fees are in the works. Among these fees will be a new Fire fee. To quote Keith:

"These are only estimates, but what would happen is they would reduce the avg. households mil by $50.00, what portion goes to fire from your mil, and then would add a FIRE FEE of $250.00 to $300.00 to your TAX bill. Who knows, the new FIRE UNION contract this Sep.(starts negotiations) could increase the FEE even higher."  

Perhaps this is what we want anyway, right? After all, Council Member Ken Greene said that everyone talking to him wants their taxes raised. (By the way, don't you love how he uses the straw men's argument. Who's everyone?).

There will be more budget workshops. These are the dates: 6/15, 6/23, 6/30, and 7/7. I believe it is very important that we start attending these meetings and make our voice heard, loud and clear.

Please call your City Council Member and let them know how you feel and be sure to let your neighbors know, as well.

Harry Santiago Jr.

18 Signs The Collapse of Society Is Accelerating

Here are chilling facts about our ongoing decelerating civil society.

18 Signs The Collapse of Society Is Accelerating

Ordinance Would Force Property Owners to Surrender Keys to Government

Wednesday, June 8, 2011

The Bankers are Coming! The Bankers are Coming!

Well that's not exactly what Paul Revere actually said in 1775 to warn the revolutionaries of the coming red coats. However, it should be said in our days. It is no secret, now, and even common knowledge that the Federal Reserve is a private banking cartel with government teeth; usurping Article I Section 8 of the U.S. Constitution. From the days of the Constitutional Convention, the people's representatives were authorized to "coin money," but as recently as 1913 to present day, a conglomerate of private bankers with the name "federal" next to the word "reserve" have stripped the money-making authority away from the people and into the hands of a few.

Now here is something else everyone needs to know: Since 1954, Prince Bernhard of the Netherlands established an annual secret meeting between international politicians and global private bankers, called "The Bilderbergers Group." Every year, this group has converged to set global agendas which affect every facet of our lives from Foreign Policies to Wars and Regime Change to Economic Trends, and yes... the taxes we pay, energy prices, and the inflation rate of our dollars. They've included special participants such as Governor George Pataki, Governor Rick Perry, and other American and international politicians, as well as royalty and well known global financiers - such as the Queen of the Netherlands and George Soros, respectively.

I've recently been looking at what these guys do (since it appears that our votes doesn't mean much anymore these days), and many of the internet's major news outlets have been covering them, as well, such as The Drudge Report and Infowars. Since the mainstream media has decided they don't cover the Bilderbergers (because many of its members own these major news outlets), then I thought I would join in the massive internet news outlets (i.e. new media or alternative media) to expose these "masters of the world." Of course, with some help by some of the better writers on this issue. Here are links on the Bilderbergers (and they will be updating daily):

Friends in High Places: Bilderberg 2011 Kicks Off

Breaking: Secret Bilderberg Agenda Leaked by Mole

Bilderbergers May Give Green Light to Mexican Central Banker as New IMF Boss

Bilderberg 2011: The polished blue line

Intimidating the Media: Bilderberg Security Seize Infowars Reporter’s Passport

Friday, April 22, 2011

Saying NO to BIG BROTHER!!!

There is no doubt in my mind that America has changed dramatically since the ratification of the Constitution and the Bill of Rights. With more and more of our freedom taken away under the name of "peace and safety," it still remains that there is no peace, and if you've seen the recent waives of gang violence and senseless beatings lately, there is certainly very little safety on our streets.

Gone are the days when every law-abiding citizen owning and carrying a firearm was as ubiquitous as criminals carrying pistols these days - while the good guys are weak and defenseless. Most people are simply domesticated and believe that whatever they are told under the guise of "what's good for them," they will accept without question and total disregard to our basic rights under the Declaration of Independence, Constitution, and Bill of Rights. However, there are a group of people in Brevard County who dare look the enemy in the eyes and simply say, "NO."

That's what a recent protest on the corner of Minton Rd and Palm Bay Rd was all about, when a group of Liberty-Loving, Red-Blooded Americans rallied against the red light cameras. But it doesn't stop there. Red light cameras are yesterday news that freedom-lovers today are trying to carve out of their ordinances in every city and town across America. Today, we have TSA sticking their hands down our pants and radiating us in body scanners, tomorrow will be more shocking news of our basic rights being peeled away as most Americans - like unsuspecting frogs - are being boiled in a kettle of deception.

Nevertheless, I believe the red light camera protest is a positive direction in the land of the free, and home of the brave. As the spirit of 1776 continues to ignite in the enlightened minds of the citizenry, we rediscover the true meaning of those famous words once uttered by Patrick Henry, "Give me liberty, or give me death."

Sunday, March 6, 2011

A Bitter-Sweet City Council Meeting

I must confess the council meeting previously held on March 3rd was bitter-sweet for me as a resident of Palm Bay, and a citizen of a Constitutional Democratic-Republic, respectively.

On the one hand, Councilmembers voted 4 to 1 against a Budget Workshop Group, where each councilmember would have selected citizens to become part of a committee that would have worked specifically on the municipality's budget.

There were several reasons given as to why such a group is not necessary. One of them is: we elect coucilmembers and they elect a city manager. However, if that were the case, all other committees would not be necessary, either. I am of the opinion, however, that our City's dire economic situation may be one culprit, as I explained in a previous blog.

Although our financial books are out in the open to the public - as it should be - the question is how many people understand their local government financial circumstance beyond the tax rate they're paying? Government accountability is not only about lowering and raising taxes, it's also about how the money is spent, as well. As you all know, fiscal responsibility and accountability ensures that taxes remain low while essential government services remain sound (at minimum) or improve (at best).

A budget workshop group where each councilmember chooses one or more vigilant citizen from Palm Bay would have brought more involvement from the public. Then again, that's just my opinion.

On the other hand, I did see a glimmer of hope, a light at the end of the tunnel. In my last blog, previous to this one, on March 1st, I wrote about "5 Great Ideas For Palm Bay." One of my ideas, "No. 3: Emphasize Government Services on Public Works and Utilities," I spoke about how good roads attract businesses. I believe the Mayor said it best when he said, "If you don't have good roads, nothing works." I couldn't agree with him more.

(See Video Below)

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By a unanimous vote, councilmembers agreed to increase the portion out of total millage that is allocated to road improvements from a 0.6413 millage rate to 1.00 millage rate.

Let me emphasize, THIS IS NOT A TAX INCREASE.

We still have the same tax rate at $7.50 per $1,000 (albeit the second highest in the county), only within the same tax rate (or millage) the portion pertaining to road improvements was bumped up a little by 0.3587 millage.

Time will tell whether or not this new re-allocation will be significant enough for our roads. But at least a first step was taken to use the money already going in, AND NOT A PENNY MORE RAISED IN TAXES OR ASSESSMENTS OR OBLIGATIONS.

To view the March 3rd City Council Meeting and choose the specific segments you'll like to watch, please click here

Tuesday, March 1, 2011

5 Great Ideas for Palm Bay

There is certainly a lot going on these days: civil wars in the middle-east, gas prices rising, the U.S. Dollar devaluating further-and-further, and local governments going broke and shutting down services. As if these issues weren’t enough, the real estate market is still declining, and there are yet more bank failures.

What about the City of Palm Bay? Aren’t there enough problems here locally? I spoke about them in previous blogs – among them are rising debts.

Nevertheless, we all have enough of our share of bad reports. I’d like to, instead, shed some light with some solutions that can benefit us, locally, while Washington D.C. implodes. I call them “5 Great Ideas for Palm Bay.”

No. 1: Cut Tax Rates By At least a third

Palm Bay residents are undergoing one of the worst economic times with unemployment rate above 12% locally. Moreover, our home values have been crushed to prices not seen since the early 1990’s. Yet, our City has the second highest property taxes in Brevard County, with a millage rate of $7.50 per $1,000. A 33% cut in millage rate would put us at approximately $5.00 per $1,000, reducing the average homeowner’s tax-burden from $562.50 a year to $375.00 a year – based on $125,000 home price minus $50,000 homestead. That’s a $187 annual savings that every hardworking family can use to buy other necessities, such as groceries and fuel.

No. 2: Reduce Government Expenditures to Pre-Real Estate Bubble Era

There is no doubt that certain decisions made by the “unholy alliance” between our federal government and big banks have created an artificial bubble that, unfortunately, much like the tech-bubble of the 1990’s, probably won’t return. After all, you don’t see investors buying up shell companies with empty promises of innovative technologies, anymore. The same is true about real estate: ridiculously low interest rates, non-stop paper dollar printing and crafty default-proof loans are what spurred the housing bubble.

Suppressed home values mean lower revenues and by default results in a smaller government. To put it frankly, when there’s no money… there’s no money. That’s what the big hoopla in Wisconsin is all about, and Palm Bay is not immune. We simply can not keep spending like we’re in the real estate bubble of 2005 and not pay the price for it.

Since the bubble began around the year 2000 and current home prices are similar to prices in the recession of the 1990’s, I believe expenditures should be around the range of $38,000,000 to $40,000,000 annually. That’s over 50% reduction from 2009’s total expenses of over $82,000,000. And in case anyone is wondering if this is possible, think about this for a moment: over 50% of our municipality’s total expenditures are salaries – the lion share which belongs to a handful of our “public servants” which receive a handsome six-figure annual wage that would make upper-management in most fortune 100 companies envious.

No. 3: Emphasize Government Services on Public Works and Utilities

There is the old adage in the real estate business: Location… Location… Location. The same is true about attracting businesses, except to create an exceptional location, the focus have to be on: Infrastructure… Infrastructure… Infrastructure. Let’s face it, who wants to set up a business where there are dirt roads, miles away from the nearest highway exit, and no available essential utilities.

No. 4: Suspend All Business Fees, Impact Fees, and other anti-business ordinances

Creating an environment conducive to success is essential to attracting new businesses and inevitably new jobs. But cutting taxes is not enough. Removing all other hindrances, like revenue-grabbing fees that serve no public safety purposes and absurd marketing-prohibitive rules will give our small business owners room to breath and be creative as they struggle to pay the bills.

No. 5: Remove Red-light Cameras

Here is another revenue-grabbing initiative that has little to do with public safety and more to do with lining the pockets of the few at the expense of the general public. Moreover, red-light cameras are intrusive and unconstitutional. It violates our fourth amendment rights to be “secured in our persons… against unreasonable searches and seizures… ”

Well, there you have it. 5 great ideas, which I believe can alleviate some of our financial and regulatory burdens in today’s tough economic climate. Whether these things can get done in one year or over a reasonable period of time, is up for debate, but I think most people won't argue that they need to get done, eventually.

Wednesday, January 26, 2011

State of the Union, Austerity, and Palm Bay

If you had tuned into President Barack Obama’s 2011 State of the Union, you may have some mixed feelings about the speech and setting. The “Reagan-esque” speech and the appearance of unity of both Republicans and Democrats sitting together were uplifting and hopeful.

But for some of us who understand the history of the rise and fall of nations are able to clearly see the stitches on the fastball. First there is the false claim of higher wages:

“Thanks to the tax cuts we passed, Americans' paychecks are a little bigger today.”

Laughable but not really funny; especially after many hard-working moms and dads have lost their jobs, or after months (and in some cases years) some are still looking for jobs. The most recent “average wage per job” numbers by the U.S. Department of Commerce’s Bureau of Economic Analysis does illustrate a $453.00 increase from 2008 to 2009. However, the same years show us a significant drop in “wage and salary employment” by 494,623 jobs. (See graphs below).

What this means is most low wage workers (i.e. the middle-class and poor) lost their jobs and the high wage workers (i.e. the upper-middle class and affluent) maintained employment. In some cases, some high wage workers lost their jobs while some of their responsibilities were piled on to low wage workers for a couple of bucks more in their paycheck (i.e. attrition and reorganization). These are some measures taken in corporate America to deal with declining business that makes overall wages seem stable (or increasing a little) but only at the cost of more jobs being lost.          

Nevertheless, tucked away within the good feelings and positive talk of the State of Union, I was able to find the most relevant excerpt of the speech that will help me determine the future of my City (as well as my Country). In case you missed it, here it is (I’ve emboldened certain words to emphasize its significance):

“Now, the final critical step in winning the future is to make sure we aren't buried under a mountain of debt… we have to confront the fact that our government spends more than it takes in. That is not sustainable. Every day, families sacrifice to live within their means. They deserve a government that does the same. So tonight, I am proposing that starting this year, we freeze annual domestic spending for the next five years… reduce the deficit by more than $400 billion over the next decade, and will bring discretionary spending to the lowest share of our economy since Dwight Eisenhower was President. This freeze will require painful cuts. Already, we've frozen the salaries of hardworking federal employees for the next two years. I've proposed cuts to things I care deeply about, like community action programs. The Secretary of Defense has also agreed to cut tens of billions of dollars in spending that he and his generals believe our military can do without.”

The words you should especially take note of are: “not sustainable” and “... frozen the salaries of... federal employees...” This is called “austerity” and Americans for the first time will experience this very soon.

It is unlike the “Great Depression” of the 1930’s, when Americans experienced a collapsed economy due to the stock market crashing as a result of margin calls; thus causing businesses to shut down due to a lack of investments and credit. Many Americans were not living in major cities and dependant on government for jobs, and many citizens were not receiving a pension, either. Most people were still living off the land, and they knew how to skin and gut a buck or at least catch a fish. However, FDR’s “New Deal” policies and World War II - assisted by President Woodrow Wilson’s Sixteenth Amendment and the Federal Reserve Act (of 1913) - brought about the growth of the federal government in ways that were unimaginable to most Americans. More federal government jobs and programs were created over the years. Soon, the State and local governments would follow suit at the pressure of its constituency who, after decades of seeing the feds hand out jobs with ease, thought they can mimic the unconstitutional beast from Washington. However, as I explained in my last blog and best said by Governor Chris Christie of New Jersey, “We are not the federal government; we can’t print money out of thin air.”

To better explain this in layman terms, imagine a couple and their baby boy. These parents make good money and have great credit. As the baby grows up to become a toddler, then a big boy, then a teenager, then a young man, the parents never weaned their child off of being dependant on them. They never taught the child how to be independent and self-sufficient; always providing everything the child ever wanted, which only progressed and became more expensive as the child grew older: it begins with toys, video games, eating out every night, the latest fashion outfits, tuition to the best ivy-league school in the State, the flashiest sports car, and even rent money for his decked-out bachelor pad. Then life happens, one of the parents is laid off from a high-paying job, and the once affluent life style enjoyed by this couple and their spoiled child comes to an abrupt end. They try to hide the situation and make it seem everything is fine. The bills keep coming in and they start paying off debt with debt, in the hopes that a miracle will happen with the prospect of a high-paying job, and everything will go back to normal. But reality sets in, and they break the news to their precious boy. Needless to say, their college educated dependent doesn’t understand what’s happening. He still expects the checks to come in, the car note as well as the rent to be paid. After all, he is entitled to it, right? Finally, the bank account is cleaned out, the credit cards maxed out, and the bank refuses to lend anymore money to the well-meaning parents. They only have enough income for the essentials like food and mortgage. Realizing their spending habits are unsustainable (there’s that word again); they are forced to readjust and stop paying for their son’s luxury. Unbeknownst to their young stud, living on cloud nine, he wakes up one day and find the sports car gone after being repossessed by the bank, then to make matters worst, he goes to his apartment one night after partying all evening and finds an eviction notice posted on his front door. The young man takes a bus back to his parents’ house with the few dollars he has in his pocket, and walks in to an almost empty home – since most of the furniture was sold in a garage sale – and for the first time in his life he hear words coming from his parents that seem foreign to him, “son,” Dad says with a cold look in his eyes, “if you want to stay in college, drive your own car, and live in your own place, then you’ll just have to work and make your own way.” A reality that always has been, but never experienced due to the false sense of security the lad was living.

Sadly, most of us having lived like the young man in the story above, will experience the same kind of austerity, as well. Simply put, when there isn’t anymore money… there just isn’t anymore money.

Merriam-Webster Dictionary Online defines “austerity” as “enforced or extreme economy.” Currently, several nations are imposing austerity measures in countries like Cuba and Ireland; firing hundreds of thousands of government workers and even telling them to create their own businesses, as well. Municipalities, here in the United States, are shutting down services and cutting pensions. U.S. legislators are considering passing laws to allow States go through bankruptcy. Whether it happens or not is irrelevant, what is relevant is that both the feds and the States are broke; and many local governments enjoying relatively low taxes, big government, and exorbitant pensions, with the caveat of federal and State handouts to meet budgets, will be shocked when they simply don’t come, at all.

Then… as I mentioned in my last blog, “The biggest test for our City Council Members is about to face them, and their decision can mean more money in our wallets or more money out of our wallets.”

Friday, January 21, 2011

Crunch Time for Palm Bay

The biggest test for our City Council Members is about to face them, and their decision can mean more money in our wallets or more money out of our wallets.

It’s no secret that our national economy is the worst it’s ever been since the great depression and with more real estate foreclosures on the horizon, oil set to rise well over $100 per barrel (with some analysts conservatively predicting almost $200 by the end of the year), and China’s tyrannical dictator Hu Jintao calling for the end of the Dollar and its replacement of the Chinese Yuan as the new world’s trading currency reserve, it’s only a matter of time until hyperinflation hits the store shelves and gasoline pumps.

Although our national woes are great and inevitable, there is a double-whammy when considering the local woes. First there are the massive pension problems in the State of Florida as well as “… cities paying close to 70 percent of their overall budget on pensions” in many of Florida’s crippling municipalities Many City Council Members are forced to come face-to-face with this reality, as our own Mayor John Mazziotti said, ". . . All employees, union and non-union, and all citizens, owners and renters, must understand that these are different and difficult times, that we are entering a period that will be known as the 'new normal,' and that we must be willing to restructure how we provide services, how we pay for those services and how we compensate our employees."

We are not alone, as many states are facing the same problems. But behind the declining government revenues, there lies another looming problem: The Municipal Bond Problem! Let’s face it, like Governor Chris Christie from New Jersey said, “We are not the federal government, we can not print money out of thin air.” With China and the rest of the world threatening to dump the dollar at the first chance they get, the U.S. Congress has suddenly become more fiscally conscience about spending and raising the debt ceiling in order to keep the dollar attractive in the international trading market. Of course, less money from Washington will soon leave us with only two alternatives here at our municipality: cut government spending or tax the people more.

As I mentioned in a previous article we are the second highest taxed municipality in all of Brevard County. We also have the second highest unemployment rate in the county, as well. Palm Bay is also depopulating. I have spoken with some Palm Bay residents either at the last garage sale I had, or neighbors of friends and families, who are moving either to the next town over from Palm Bay or a nearby county to avoid paying a few dollars in their millage rate. I mean what’s a few dollars, right? Well, a few dollars per one thousand dollars can mean a few hundred dollars more in your wallet every year (even a couple of thousand dollars more depending on the assessed value of your home). Nevertheless, in this economy, a few hundred dollars more a year can mean the difference between food on the table or a few hungry nights; just barely paying the mortgage or being behind on mortgage payments; having enough gas to drive to work or calling out of work because there is no money for transportation. Those of us dealing with this economic depression know what it means to have to cut our own spending habits. After all, we don’t have the police power of government to force others to pay us from the fruit of their labors. However, does our local government understand our plight? Will they raise taxes or lower taxes?

Let’s suppose our City Council Members unanimously vote to stay the millage rate or even decrease the millage rate, then that means they have one other alternative: to cut spending. This may sound easy. Some of you may already have some solutions off the top of your heads: 30% cut across the board, or cut this department spending or cut that department spending. I am sure many of us won’t miss a lot of government services if they were hardly functioning or not functioning, at all. A recent poll revealed that nearly 60% of all Americans wouldn’t mind if some essential government services were not provided for a few days out of the week or not provided, at all. But when you’re talking about cutting government spending, what exactly do you cut? What would you consider an essential government service? How much is enough for those services that “We The People” are willing to pay out of our wallets?

There is an interesting way of looking at this situation. Palm Bay has two investors: Tax-Paying Residents and Municipal Bond Investors. As previously stated, we can not print money out of thin air. So, that means, tax revenue and debt will be the only bread and butter of local governments such as ours. We’ve already establish that if we raise taxes (or even leave them where they’re at) we risk putting more pressure on hard-working families (i.e. our primary investors) and further suppressing the local real estate market. That leaves us with the secondary investors, and unlike our primary investors, those secondary investors are not obligated to pay into our local government system. All they have to do is take one good look at our financial statements for the past five years, and they will find two facts that can mean purchasing millions of dollars of municipal bonds or considering them worthless:

1.Palm Bay has been operating in the red for the past four years

2.Palm Bay’s special interest bonds have spiked significantly from approximately 5% of our total outstanding bonds in 2005, to almost 20% of our total outstanding bonds in 2009.

Now, from the municipal bond investor’s point of view, it would make more sense to invest in municipal bonds that pertain to essential services like utilities and public works. Most of these municipal bonds are solid and are looked at favorably by most institutional investors since infrastructure is essential to maintaining a viable City. Not so for pension-backed municipal bonds. If you knocked on the door of every occupied home in Palm Bay, I am pretty sure that 9 out of every 10 home owner will have no problem paying for those essential services, but will be appalled at paying more for pensions – especially during these tough economic times.

You see… the secondary investors know this about the primary investors. And when the federal hand-outs are finally exhausted and the pension fund is running dry, the only people left to buy the special interest bonds, which fund pensions, are tax-payers and municipal bond investors. This is where the rubber meets the road, and all eyes are on City Council.

Care to know what’s in store for municipal workers and municipalities in the United States, Palm Bay included? Take a good look at Greece, France, Great Britain, Tunisia or a little closer, here, at California. Government services will be forced to shut down for days or indefinitely, government programs face imminent shut downs, as well; pensions in jeopardy of being unfunded and retirees living on fixed income are looking at checks with less amounts or no checks in the mail, at all, for an indefinite period of time.

The financial plague bankrupting California is sure to come to the east. As well as the financial plague causing massive riots and government shut-downs over the "pond" will soon make its way on to our beautiful, sunny, beaches. And the real question we must ask of our elected public servants is, what are we doing to bring back solvency to our municipality without hurting our residents or our credit? Its crunch time, and all eyes and ears are on Palm Bay City Council.