Surplus and Reserves: A Financial Tale of Three Florida Counties

Regular followers of Manatee County government know that June is a pivotal time when County Commissioners review departmental budgets and set spending priorities for the upcoming fiscal year. Unfortunately, very little time is spent examining the actual financial results of previous years, and the result is that massive surpluses and large unrestricted cash balances have been building up for many years, way beyond what is necessary to run the County.

Case in point, in the 2024 fiscal year, Manatee County generated a surplus of $459.8 million (revenues less expenses) and has unrestricted cash on its balance sheet of $965.6 million – almost enough to run the county for a year without collecting a dime in revenue from any revenue source ( like property taxes, grants, development fees or utility service). Florida statutes mandate that all counties run balanced budgets and hold in reserves no more than 30% of budgeted expenditure, and Manatee County is clearly non-compliant with these statutory provisions.

Recently I ran a comparison of Manatee County’s surplus against Pinellas and Sarasota and found that both counties do a better job (although not a great job) than Manatee County at balancing revenues and expenses. For example, Pinellas County ran a surplus of $361.7 million in 2024, which is equal to 47.2 % of property tax collections, while Sarasota ran a surplus of $333.4 million, equal to 92.4% of property tax collections. In contrast, Manatee County’s surplus/property tax ratio was 115% - indicating that property taxes were not necessary to run the County in 2024 – a point that Governor DeSantis has been talking about in Tallahassee this year.

Looking at unrestricted cash on the balance sheet, Pinellas County had $234 million against a 30% Florida statute reserve limitation of $464.7 million, while Sarasota had unrestricted cash of $268.7 million against a 30% reserve limitation of $293.1 million. In contrast, Manatee County had unrestricted cash of $965.6 million against a 30% reserve limitation of $297.3 million. Evaluating this statistic, both Pinellas and Sarasota are compliant with Florida statute 129.01c1,c2, while Manatee County is flagrantly non-compliant with Florida law.

These excess reserves represent money that has been removed from Manatee County’s economy and are just sitting in money market funds, providing no benefit to the local economy or its citizens. The large surpluses also raise the issue of fair taxation. Is Manatee County charging too much for its services? This issue is particularly important for the 40% of Manatee County citizens who are living paycheck to paycheck. At a recent Manatee County meeting, I raised these very same points and was met with no response by any Commissioner. Perhaps if more of us show up at the June budget hearings, this official attitude might change.

Mike Meehan, CFA, MBA