Kent Olson
Deputy Treasurer-Clerk
City of Tallahassee
February 7, 2014
• Overview of Truth in Millage (TRIM)
• TRIM Calendar
• Budget Hearing requirements
• Advertisements
• TRIM Compliance
• Relevant (and often Required) Forms
• Maximum Millage and Future Levy Capacity
• Value Adjustment Board
• Theatrical Demonstration
2
What is Truth in Millage (TRIM)?
 TRIM is under Florida Statutes 200 - Determination
of Millage
 Specifically governed by F. S. 200.065 - Method of
Fixing Millage
 Purpose is to provide taxpayers transparency in
how local taxing authorities propose and approve
millage rates as part of the taxing authorities’
budget adoption process.
 Determine whether there is a tax increase
proposed (calculate the rolled-back rate)
3
What is the Rolled-back Rate?
 The millage rate necessary to raise, in the
aggregate, the same amount of money this
year from the taxpayers on last year’s tax roll
that was raised a year ago (excludes new
construction)
 Levying a millage rate higher than the rolledback rate will require the taxing body to
advertise a tax increase
4
Truth in Millage (TRIM)
 Florida Statute Chapter 200
 Provides calendar for property tax levy and
budget adoption process
 Outlines requirements to be in compliance
 Department of Revenue (DOR) is responsible
for enforcing compliance
5
Key Processes
 TRIM Notice (forms DR-420, DR-420MM-P, DR-
420TIF forms)
 Budget Ordinance & Resolutions
 Proper Notices and Advertisements
 Public Hearings
 DR-422 (before and after VAB)
 TRIM Compliance Package
6
TRIM Calendar
 On or before June 1st - Property Appraiser
provides estimated taxable values to local taxing
authorities (not technically part of TRIM)
 July 1 – 1st day of calendar – Property Appraiser
provides the Preliminary Tax Roll to all taxing
bodies on Form DR-420
— This is the basis for levying property taxes in the upcoming year
 By day 35 (August 4), taxing bodies must file with
the property appraiser and the tax collector the
tentative millage rate on form DR-420 as well as
forms DR-420TIF and DR-420MM-P
— Also must provide tentative (1st) public hearing date on DR-420
7
TRIM Calendar (cont.)
 Notice of Proposed Taxes is distributed by the
Property Appraiser no later than day 55 (August 24)
 Between day 65 (September 3) and day 80
(September 18), taxing authority must hold its first
public hearing
 Within 15 days of holding the first public hearing, the
taxing authority must publish an advertisement to
adopt the final millage and budget
8
TRIM Calendar (cont.)
 Second public hearing must be held between 2 and 5
days after the advertisement has been published
 Within 3 days after the second public hearing, taxing
authority must file its millage rate ordinance with the
property appraiser and the tax collector
9
TRIM Calendar (cont.)
 End of September or early October - Taxing authorities
receive extended roll taxable values from Property
Appraiser (DR-422). Taxing authorities have three days to
determine if they will adjust their millage rates
administratively
 Within 30 days after the second public hearing, taxing
authority files certification (DR-487) and required
documentation with the Department of Revenue (DOR)
 Within 60 days after the second public hearing, the DOR
will indicate compliance or non-compliance with the
Statute
 After completion of Value Adjustment Board hearings,
Property Appraiser provides taxing authorities with final
taxable values
10
Budget Hearings
 Per F.S. 200.065, School Boards and Counties have
priority in selecting public hearing dates
 School Boards get first priority, Counties are second
 No other taxing authority can hold its hearing on the
same date as the School Boards or Counties
 Hearings start after 5 p.m. (5:01 p.m. at the earliest,
for the Department of Revenue)
11
Budget Hearings (cont.)
 At both hearings, millage rate must be discussed first
before the Budget; increase over the rolled-back rate
must be announced
 At the first public hearing, the millage rate can be
increased from the tentatively adopted millage in July;
however, would require a first class mailing to all
taxpayers
 At the second public hearing, the millage rate cannot be
increased from the tentatively adopted millage rate at
the first public hearing
12
Budget Hearings (cont.)
 The general public is allowed to speak before the
governing body can take any action of adoption
 The millage must be adopted before the budget can be
adopted
 No millage can be levied until a resolution or ordinance
has been adopted by the taxing authority
13
Public Hearing
14
Budget Hearings (cont.)
 The following must be publicly announced at the
hearing before the millage can be adopted:
 Name of the Taxing Authority
 Rolled-back rate
 Percentage of increase over the rolled-back rate
 Millage to be levied
15
Ad Publication Requirements
 If the proposed millage rate is greater than the
rolled-back rate, then you must publish a Notice
of Tax Increase ad
 If the proposed millage rate is less than or equal
to the rolled-back rate, then you must publish a
Notice of Budget Hearing ad
 In either case, a Budget Summary advertisement
is required to be published adjacent to the
appropriate “Notice” ad
16
Notice of Proposed Tax Increase Ad
 There are size requirements for the Notice of
Proposed Tax Increase ad
—Full 1/4 page
—Headline type of 18 point or larger
 May not be published in legal or classifieds
 Do not deviate from specified language (see
TRIM Manual on DOR website)
17
Notice of Budget Hearing Ad
 No specific size requirements
 May not be published in legal or classifieds
 Do not deviate from specified language
18
Budget Summary Ad
 No size requirements
 Must be published adjacent to the appropriate
“Notice” ad
 Include all budgeted funds, revenues, expenditures
and reserves
 Group by fund type (General, Special Revenue, etc.)
 Use major classifications to group revenues and
expenditures
 Exclude trust, agency, internal service funds as well as
bond proceeds
19
Budget Summary Ad (cont.)
 Basically shows flow of funds including
reserves available, revenues and expenditures,
transfers, yielding in effect a “Total Available”
and a “Total Appropriated”, including reserves
 Must show ad valorem revenue at a level of
95% or greater of the tax levy amount
 See Examples in TRIM Manual
20
DOR TRIM Violations/Infractions
 DOR keeps track of violations or infractions
annually
 “Minor” infractions are noted with the letter
the taxing authority receives if the TRIM
package is “in compliance”
 “Serious” violations and how they may be
corrected are included in letter of noncompliance
21
Non-Compliance
22
Non-Compliance
 If Department of Revenue review indicates
non-compliance with maximum rates
• Determination within 30 days of submittal
deadline (30 days after adoption)
• Repeat hearing and advertisement process
• Notice includes “Previous Notice . . In Violation of
the Law”
• Revised millage adopted recertified with State
within 15 days of adoption; not sent to PA or TC
23
Non-Compliance Notice Language
 THE PREVIOUS NOTICE PLACED BY THE (name
of taxing authority) HAS BEEN DETERMINED
BY THE DEPARTMENT OF REVENUE TO BE IN
VIOLATION OF THE LAW, NECESSITATING THIS
SECOND NOTICE.
24
Non-Compliance (cont.)
 If the Department of Revenue determines non-
compliance is remedied & recertified, no
penalty
 If compliance is not recertified, penalty
 If non-compliance is not remedied, penalty
 Penalty: 12 months of sales tax revenues
25
Non-Compliance Corrected
 If excess taxes are collected, held by tax
collector in trust
 Excess may only be used to reduce taxes in
subsequent fiscal year
26
• DR-420 – Every taxing body completes; the main
form in this process
• DR-420TIF – for reporting tax increment financing
districts information
• DR-420MM-P – Preliminary Maximum Millage
• DR-420DEBT – Certification of Voted Debt Millage
(if applicable)
27
•DR-420MM – Final Maximum Millage
• DR-422 – May be used to Revise Millage, if
permitted
• DR-487V – Governing Body Vote Record
• DR-487 – Used to transmit the millage certification
package
28
TRIM Notice Forms
 Forms are inter-related
 Complete DR-420TIF first, then DR-420 and DR-
420MM-P
 Should be completed and presented together for
policymakers’ review
29
DR-420
 Main purpose is to determine the rolled-back rate
and its relationship to the proposed millage rate
 Property Appraiser completes property value
information at the top of the form
 Form is filed with the property appraiser (original
and one copy) and tax collector (one copy)
 Taxing body completes the remainder of the form
(see example)
30
DR-420 (cont.)
 Due no later than Thursday, August 4th - 35 days
after start of TRIM process
 Must obtain DR-420MM-P form from DOR
website – Property Appraiser does not provide
 Check the math/data on all forms from the
Property Appraiser
 Complete package consists of three different
forms (DR-420, DR-420MM-P, DR-420TIF)
 Request revised DR forms, as necessary
31
EXAMPLE – DR-420, p. 1
DR420 Fiscal Year 2014 (Tax Levy Year 2013)
1. Current Year Tax Value- Real Property
Utopia Gardens
1,178,512,144
2. Current Year Tax Value - Personal Property
42,155,231
3. Current Year Tax Value - Centrally Assessed Property
13,260,287
4. Current Year Gross Taxable - Operating Purposes
5. Current Year Net New Taxable Value
1,233,927,662
12,268,759
6. Current Year Adjusted Taxable Value (line 4 - line 5)
1,221,658,903
7. Prior Year Final Gross Taxable Value (from prior year DR403)
1,257,978,930
8. Does authority include Tax Increment financing areas (if yes, enter
number)
9. Does the taxing authority levy a voted debt service or millage voted for 2
years or less? If yes, enter number of DR-420DEBT forms attached
10. Prior Year Operating Millage Levy
11. Prior Year Ad Valorem Proceeds (7) x (10)
12. Amount, if any, paid or applied in prior year as result of a TIF district
(sum line (6c) or (7a) for all DR420 TIF forms)
13. Adjusted Prior Year Ad Valorem Proceeds (line 11 - line 12)
1
No
7.7564
9,757,388
836,743
8,920,645
32
EXAMPLE – DR-420, p. 2
14. Dedicated Increment Value (sum of 6b or 7e for all DR420 TIF forms)
15. Adjusted Current Year Taxable Value (line 6 - line 14)
122,483,123
1,099,175,780
16. Current Year Rolled-Back Rate (line 13 divided by line 15) x 1,000
8.1158
17. Current Year Proposed Operating Millage Rate
8.1150
18. Total taxes at proposed millage rate (line 17 x line 4, div. by 1,000)
10,013,323
19. Check Type of Principal Authority
Municipality
20. Check Applicable Taxing Authority
Principal
21. Is millage levied in more than one county?
No
Dependent Special Districts and MSTUs Stop and Sign
22. Total adjusted prior year ad valorem Proceeds of authority, DSDs
&MSTUs (Line 13 From all DR420s)
23. Curr. Yr. Agg. Rolled Back Rate (line 22 div. by line 15, mult. by 1,000)
8,920,645
8.1158
24. Curr. Yr. Ag. Rolled Back Taxes (line 4 x line 23)
10,014,310
25. Total Oper. Ad Valorem Taxes (line 18 from all DR420's)
10,013,323
26. Curr. Yr. Prop. Ag. Millage Rate (line 25 divided by line 4, x 1,000)
8.1150
27. Curr. Yr. Proposed Rate – as % Chg. Rolled (line 26 divided by line 23) -1,
x100
-0.01%
33
DR-420TIF
 Property Appraiser completes property value
information on the TIF District at top of form
 Provided at the same time as DR-420
 Information from the DR-420TIF is utilized on DR420 to help in calculation of the rolled-back rate
 Form is completed by the taxing authority after
the tentative millage rate is adopted by Council
 Form is filed with the property appraiser (original
and one copy) and tax collector (one copy)
 Minimal information is completed by taxing body
34
DR-420TIF Example
1. Current Year taxable value in the tax increment area
2. Base Year taxable value in the increment area
3. Current year tax increment value (line 1 minus line 2)
4. Prior year taxable value
5. Prior year tax increment value (line 4 minus line 2)
218,057,384
89,127,781
128,929,603
195,404,171
106,276,390
6. a. Enter proportion on which the payment is based
6. b. Dedicated Increment Value (6a) x (3)
95.00%
122,483,123
6. c. Amount of Payment to Redevelopment Trust in prior year
7. If amount to be paid to Trust is not based on a proportion
of the tax increment value
7 a. Amount of Payment to Redevelopment Trust Last Yr
7 b. Prior Year Operating Millage Levy (Form DR420, line 10)
7 c. Taxes Levied on Prior (multiply line 5 by 7b, divide by 1000)
7 d. Previous Yr Payment as Prop of Taxes Levied (7a/7c)
7 e. Dedicated Increment Value (7d) x (1)
836,743
35
DR-420MM-P
 Used to determine voting levels that will be
required based upon the proposed millage rate
 Form is completed by the taxing authority after
the tentative millage rate is adopted by Council
 Form is filed with the property appraiser (original
and one copy) and tax collector (one copy) (see
forthcoming example) with DR-420 and DR420TIF
36
Maximum Millage Rates
 Per capita personal income added to the
Rolled-back Rate (RBR) only for maximum levy
limit calculation purposes
 No, Virginia, this is not a second or revised RBR
 For advertisement of a tax increase, only RBR
counts
 Levy limits – majority, 2/3, unanimous
37
• Majority vote – Rolled-back rate(RBR), plus per
capita personal income change
• Two-thirds vote – 110% of RBR adjusted for per
capita personal income
• Unanimous vote (¾ if 9 or more) – up to 10 Mil
Cap
• Referendum – up to 10 Mil Cap
• Super-majority vote is of the membership of the
governing body, not the members who are present
38
Example - Form DR-420MM-P, p. 1
DR-420MM-P for FY14 (Levy Year 2013):
Utopia Gardens
1. Has your taxing authority levied ad valorem for < 5 yrs?
No
2. Current Year rolled-back rate from Current Year Form DR420, line 16
8.1158
3. Prior Year majority vote maximum rate from 2012 Form DR420MM, line 13
7.9471
4. Prior Year operating millage levy from Current Year Form DR420, line 10
7.7564
If line 4 is equal to or greater than line 3, skip to line 11. If less, continue to line 5.
5. Prior year final gross taxable value from Current Year Form DR420, line 7
6. Prior year maximum ad val. proceeds with majority vote (3 x 5 div. by 1,000)
7. Amount paid or applied in prior year to a TIF district (C.Y. Form DR420, line 12)
8. Adjusted prior year ad val. proceeds with majority vote (line 6 minus line 7)
9. Adjusted current year taxable value from Current Year Form DR420, line 15
1,257,978,903
9,997,284
836,743
9,160,541
1,099,175,780
10. Adjusted current year rolled-back rate (line 8 divided by line 9, x 1000)
8.3340
11. Rolled-back rate to be used for maximum millage calculation (line 10, if adjusted, or
line 2)
8.3340
12. Change in per capita Florida personal income
1.0169
13. Majority vote maximum millage rate allowed (line 11 x line 12)
8.4748
39
Example - Form DR-420MM-P, p. 2
14. Two-thirds vote maximum millage rate allowed (line 13 x 1.10)
9.3222
15. Current year proposed millage rate
8.1150
16. Minimum vote required to levy proposed millage (check one)
17. The selection on line 16 allows a maximum millage rate of:(enter appropriate
rate)
18. Current Year gross taxable value from Current Year Form DR420, line 4
Majority
8.4748
1,233,927,662
19. Current year proposed taxes (line 15 x line 18, div. by 1000)
10,013,323
20. Total taxes levied at the maximum millage rate(line 17 x line 18, div. by 1000)
10,457,290
21. Current year proposed taxes of all dependent special districts & MSTUs (sum
of all lines 19 from each district’s Form DR420MM)
0
22. Total current year proposed taxes (line 19 plus line 21)
10,013,323
23. Taxes at the maximum millage of all dependent special districts & MSTUs
0
(the sum of all lines 20 from each district's Form DR420 MM)
24. Total taxes at maximum millage rate (line 20 plus line 23)
25. Are proposed taxes on line 22 < or = to taxes on line 24?
10,457,290
yes
40
Example – Form DR-420DEBT
DR-420DEBT
Utopia Beach
1. Current Year Tax Value- Real Property
47,454,987,051
4,725,173,049
194,778,969
52,374,939,069
0.4852
1.0000
2. Current Year Tax Value - Personal Property
3. Current Year Tax Value - Centrally Assessed Property
4. Current Year Gross Taxable - Operating Purposes
5. Current Year proposed voted debt millage rate
6. Current year proposed millage voted for 2 yrs or less
41
DR-420MM
 Very similar to DR-420MM-P
 Form is completed by the taxing authority
after the Council has adopted the final millage
rate at the second budget hearing
 Used to verify that the taxing authority
adopted a millage rate in accordance with the
voting requirements (see example)
42
Form DR-420MM, p. 1
DR-420 MM for FY 2014 (Levy Year 2013):
Utopia Gardens
1. Has your taxing authority levied ad valorem for < 5 yrs?
No
2. Current Year rolled-back rate from Current Year Form DR420, line 16
8.1158
3. Prior Year majority vote maximum rate from 2012 Form DR420MM, line 13
7.9471
4. Prior Year operating millage levy from Current Year Form DR420, line 10
7.7564
If line 4 is equal to or greater than line 3, skip to line 11. If less, continue to line 5.
5. Prior year final gross taxable value from Current Year Form DR420, line 7
6. Prior year maximum ad val. proceeds with majority vote (3 x 5 div. by 1,000)
1,257,978,903
9,997,284
7. Amount paid or applied in prior year to a TIF district (Form DR420, line 12)
836,743
8. Adjusted prior year ad val. proceeds with majority vote (line 6 minus line 7)
9,160,541
9. Adjusted current year taxable value from Current Year Form DR420, line 15
1,099,175,780
10. Adjusted current year rolled-back rate (line 8 divided by line 9, x 1000)
8.3340
11. Rolled-back rate to be used for maximum millage calculation (line 10 if adjusted, or
line 2)
8.3340
12. Change in per capita Florida personal income
1.0169
13. Majority vote maximum millage rate allowed (line 11 x line 12)
8.4748
43
Form DR-420MM, p. 2
14. Two-thirds vote maximum millage rate allowed (line 13 x 1.10)
9.3222
15. Current year adopted millage rate
8.1150
16. Minimum vote required to levy proposed millage (check one)
17. The selection on line 16 allows a maximum millage rate of:(enter appropriate
rate)
18. Current Year gross taxable value from Current Year Form DR420, line 4
Majority
8.4748
1,233,927,662
19. Current year adopted taxes (line 15 x line 18, div. by 1000)
10,013,323
20. Total taxes levied at the maximum millage rate(line 17 x line 18, div. by 1000)
10,457,290
21. Current year adopted taxes of all dependent special districts & MSTUs (sum of
all lines 19 from each district’s Form DR420MM)
22. Total current year adopted taxes (line 19 plus line 21)
0
10,013,323
23. Taxes at the maximum millage of all dependent special districts & MSTUs
0
(the sum of all lines 20 from each district's Form DR420 MM)
24. Total taxes at maximum millage rate (line 20 plus line 23)
25. Are adopted taxes on line 22 < or = to taxes on line 24?
10,457,290
yes
44
DR-422
 Form is prepared by the Property Appraiser once the
Final Taxable Value has been established (October 1)
 Taxing authority has 3 days to return the form to the
Property Appraiser
 Form may be used to adjust millage administratively if
the assessed value changes significantly from the July 1
Preliminary Tax Value
 Definition of “Significantly”
 More than 1% for cities, counties, schools and water
management districts
 More than 3% for MSTUs and special districts
45
Example – Form DR-422
DR-422
1. Current year gross taxable value line 4, DR420
2. Final current year gross taxable value from Form DR403
Percentage of change in taxable value (line 2 divided by line 1, minus 1, mult. by 100)
4a. County or municipal principal taxing authority millage rate
5. Unadjusted gross ad valorem proceeds (line 1 x line 4a, divided by 1,000)
6. Adjusted millage rate (line 5 divided by line 2, mult. by 1,000)
1,233,927,662
1,202,189,756
-2.6%
8.1150
10,013,323
8.3292
46
DR-487V
 Used to record the vote of the governing body
on the millage rate at the second budget
hearing
 Must list each governing body member and
show how they voted individually
 Form confirms whether the taxing body had
the necessary votes to adopt the millage they
voted for
47
Example – Form DR-487V
DR-487V
Name
John Dixon
George Fulton
Dan Niedermeyer
Bill Sherman
Violet Wall
Yes
Not
Present or
No Not Voting
X
X
X
X
X
48
DR-487
 Used to transmit the TRIM Compliance
package to the State
 Due within 30 days of Final Budget hearing
(see example)
49
Example Form DR-487
DR-487
Check if E-TRIM Participant
E-TRIM Participants only need to submit items 1-3
WITHIN 30 DAYS OF FINAL HEARING send this signed certification with:
1. Proof of Publication from newspaper
2. Ordinance or Resolution
a. Adopting the final millage rate with % change of rolled-back rate shown
b. Adopting the final budget, indicating order of adoption
3. ENTIRE PAGE from the newspaper
a. Budget Summary Advertisement
b. Notice of Proposed Tax Increase or Budget Hearing Advertisement
c. COUNTIES ONLY: DR-529, Notice - Tax Impact of VAB, within 30 days
of completion
4. Copy of DR420, with DR420TIF and DR420DEBT, if applicable
5. DR-420MM
6. DR-487V
7. DR-422
50
The Completed Package
51
Levy Capacity
 Levying less than Maximum Majority Vote
provides additional future capacity – not “use
it or lose it”
 Maximum majority vote millage rate in
following year is based upon the prior year
maximum majority vote millage rate
52
Levy Capacity Example
 Prior Year Maximum Millage Rate with majority
vote: 7.9471 (line 3, DR-420MM-P)
 Prior Year Millage Rate: 7.7564 (line 4, DR420MM-P)
 While RBR will be calculated starting with the
7.7564 millage, the Maximum that can be levied
by majority vote will begin with the “maximum
millage” RBR based upon the 7.9471
 Levying less than the maximum rate will create
future capacity for the majority vote maximum
53
Value Adjustment Board
 Consists of five members: two from the county board of
commissioners, one from the school board, and one
citizen each appointed by these two boards
 County appointee must be a homestead property owner
 School district appointee must own commercial property
 Adjudicates all appeals of assessed value filed by
taxpayers that are not resolved with the property
appraiser
54
Value Adjustment Board (cont.)
 Costs are shared 60% by the county, 40% by the school
district
 In theory, VAB hearings are to be completed before
October 1 of each year (in time for DR-422 to be
distributed with final values)
 Serious backlogs have developed within the last few years,
resulting in reductions in assessed value well after the tax
bills are sent out
55
Additional Resources
 Florida Statutes, Chapter 200
 Online Sunshine (www.state.leg.fl.us)
 DOR – TRIM and maximum millage
(http://dor.myflorida.com/dor/property/trim/trimmax.
html)
 DOR – TRIM Compliance Manual
(http://dor.myflorida.com/dor/property/trim/)
56
A Call for Aspiring Thespians
 Need 10 Volunteers:
 Finance Director
 City Manager
 Mayor
 Commissioners (4)
 Newspaper Ad Salesperson
 Citizens (2)
57