Water Billing Errors, Budget Concerns and Property Taxes: What Happened at the August 3 Marco Island City Council Meeting
Rick Woodworth breaks down key issues from the August 3 City Council meeting, including a major water billing error, questions about city finances and concerns about future property taxes.
Rick Woodworth
8/6/20264 min read
What Happened at the August 3, 2026 City Council Meeting
Last night’s August 3, 2026, Marco Island City Council meeting agenda did not look like it would hold many surprises. There was no vote on Hilton or Rose Marina, and nothing on the surface looked like a major issue. The best news was that Joe Belardo was confirmed as our new police chief.
Public attendance was sparse, but for residents who care about how their tax dollars are being spent, this meeting raised a number of issues worth knowing about.
First, there was the issue of a nearly $113,000 water billing mistake. Jeff Poteet deflected the
mistake to the Billing Department, which works under the Finance Department.
Over the years, there have been numerous mistakes in billing, both for potable and reuse water. I personally found several such mistakes, some dating back as long as five years, involving large reuse customers.
A resident questioned the billing rate structure applied to the Marriott and Hilton. Mr. Poteet was questioned about the need for a new rate study because the current one was done in 2006 and had actually been redone several times because some council members were not happy with the results.
The actual rate structure has not been changed since 2006, although there have been several rate increases, the most recent in 2017, I believe.
Mr. Poteet tried to discourage a new study, estimating the cost at more than $200,000. Previous rate studies ranged from $25,000 to $106,000 between 2011 and 2015, but a new one clearly needs to be done in connection with the new water meters and billing system.
I also believe the Water and Sewer Department deserves its own separate audit because its operations are a significant component of the city’s revenues. It is a big business. Shouldn’t we know more and look at the rate structure after 20 years?
Next, the new finance director, Marcia Saulo, presented an overview of the city’s third-quarter operating results.
Her report did not include any cash balances in the city’s accounts or any activity in the Public Works and Water and Sewer reserve funds, an essential part of the city’s “bucket system,” the reserve structure that funds major infrastructure work.
I have sent copies of reports I prepared from the city’s financial statements, along with review memos that I think provide more detail, to the Finance Department, Justin Martin from Public Works and Jeff Poteet at the Water and Sewer Department.
Council accepted the report as presented, but I think more information, particularly on fund balances, would be useful to residents as the city’s budget is being finalized. Is there support for providing more detailed information?
Buried within the city manager’s report was this:
“The City had the property located at 711 and 731 South Collier Blvd. appraised. The asking price for the property was $12 million, but the appraisal came in at $8 million. As a result, there will be no further action by the City to pursue the purchase of the property unless City Council directs otherwise.”
This was the city manager’s “out-of-the-box thinking” that council uncritically embraced a few meetings ago. No council member asked about it.
The appraisal itself was not presented, nor was the cost of the appraisal disclosed. Shouldn’t we see the appraisal and know what it cost?
There was good news regarding the resolution to refund or refinance the Utility System, or Water Department, bonds.
This is normally perfunctory once prepayment restrictions expire, provided interest rates are attractive. The estimated $200,000 cost of refinancing would be included in the new bonds.
However, council essentially gave bond counsel an open checkbook to proceed as long as the net present value of the benefit was 3% or better. No council member asked what that might represent over a 20-year period.
At a 3% discount rate over 20 years, that works out to approximately $40,000 to $60,494 in annual cash savings.
While certainly beneficial and not a process outside the ordinary course of business, it would have been helpful to know what residents could expect in annual savings.
Let’s hope rates move in the right direction so the costs of issuance are absorbed by savings greater than a 3% net present value. A table showing a range of debt-service savings at different rates might be useful.
Finally, the big bomb exploded.
City Manager Lucius asked for approval of the proposed maximum millage rate for the 2027 budget. She proposed a rate essentially the same as last year.
What came as a surprise to many was that if council approved that millage rate, it could not go above it later, even if the final budget required more revenue or the bond referendum failed.
Council members Champagne and Dohm pointed out the problems with that proposal. I spoke on the topic and supported their position.
Council voted 5-2 not to approve the safer, higher amount, hamstringing itself if more money is needed later. The rate could always be reduced if the final budget did not require it, but it cannot be raised if it does.
Part of this discussion also involved the calculation of the spending cap, which changed by more than $1 million within just a few years under the relatively new Finance Department staff.
Shouldn’t we have maximum flexibility to adjust the millage rate when the final budget is completed?
At this point, council communications delved into the usual discussion of personal grievances, the process for bringing ideas forward and a variety of other matters.
This meeting may have looked routine, but it raised real concerns about utility billing, financial reporting, infrastructure funding, transparency and future property taxes.
Raising these issues is not criticism for the sake of criticism. It is about examining how our city operates, identifying where we can do better and protecting residents’ interests.
We need to elect leaders who will ask thoughtful questions, review the full financial picture and insist on clear explanations before major decisions are made.
This is my take on the meeting. What do you think?
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