The Palm Beach County Commission reviewed its proposed budget for fiscal year 2018-19 on Tuesday, which calls for the same tax rate of 4.7815 mills, which will generate $894.8 million in property taxes — $49.2 million more than the current year.
County Administrator Verdenia Baker said the budget process is year-long, which began with a retreat in November 2017 where commissioners shared their strategic priorities for the coming year.
“This budget workshop tonight will hopefully give us further directions on where you want to go with the budget,” Baker said, explaining that on July 10, staff will present the budget at the commission’s meeting as a regular agenda item.
The first formal public hearing is set for Sept. 4, with the second one set for Sept. 17. Both hearings are at 6 p.m.
Baker said the budget supports goals set by the commission at the November workshop, which continues funding for economic development at $4.6 million, homelessness at $21.2 million and the heroin/opioid epidemic at $2 million.
Departmental budgets are up $17.85 million, 5.1 percent over last year.
“I have included in here across the board increases at 3 percent,” Baker said.
The budget includes the addition of 81 new positions, 40 of which are general fund ad valorem supported. These new positions are primarily in engineering and facilities development and operations. Also included are three board-supported positions in the Office of Small Business Assistance. The budget also includes 40 non-countywide ad valorem and non-ad valorem supported positions in Palm Beach County Fire-Rescue, the library system, airports, water utilities, the building division and the Tourist Development Council.
The proposed budget also includes new capital funding of $36.2 million, primarily for rehabilitation projects, an increase of $5.3 million over the current year. It includes $3 million for the South Florida Water Management District property, which is the second installment of a $9 million purchase, and a $12 million increase for voting equipment for the Supervisor of Elections Office.
The total proposed general appropriations budget is about $1.3 billion, with property taxes representing 64.4 percent of that, fund balance representing 13.2 percent, inter-fund transfers of .2 percent, charges for services is 8.2 percent, intergovernmental revenue is 9.4 percent, and licensing and permitting is 4.6 percent.
As in recent years, the Palm Beach County Sheriff’s Office will take up the largest portion of the budget.
“Primarily, the sheriff represents 47.3 percent of this amount, then county departments represent 25.5 percent, reserves are 9.2 percent, capital and non-departmental represent 8.3 percent, debt services at 4.6 percent and other constitutional officers represent 5.1 percent,” Baker said.
Looking historically, at the height of the economic boom and where it was, versus 2019, Baker said that the PBSO and county operations were very close, within $9 million of each other in 2007.
“When we look at it today, that cost has escalated,” she said. “They are roughly at $576 million, and we’re at $366 million.”
The PBSO budget is up $25.8 million, or 4.7 percent, next year, which includes a $3.2 million addition to a base request for expenses involving presidential protection.
Although the county budget is recovering, Baker pointed out that it is still below what it was in 2007.
“Palm Tran is the only department that has exceeded where we were in 2007,” she said. “Also, reserves have increased slightly over 2007, but other departments are significantly down.”
On the positive side, Baker noted that the voted debt has decreased. “We look forward for it to continue to decrease, unless the board decides to go out and issue general obligation bonds,” she said.
The library budget has increased, partially due to new libraries due to come online at the end of 2019. Palm Beach County Fire-Rescue is also increasing, with several new stations to be built, as well as the cost of providing services as the population has increased, Baker said.
The millage rate impact on an average homesteaded property will be up $25.51 per home, she said, explaining that the average value of a home was about $387,000, but the assessed median value was about $255,000. Applying the $50,000 homestead exemption, the taxable value was $205,000 and total property taxes were $1,004.97. The proposed 2019 budget reflects a total taxable value of $210,000, where the median property owner would pay $1,030.51.
Baker pointed out that the tax rate has not increased in quite some time.
“This millage rate has been held steady for the last eight years,” Baker said. “It is our goal to remain as efficient as possible.”
She said that in 2018, ad valorem revenue came in a little less than what was projected, but major revenues came in a little higher than anticipated. The balance brought forward also came in higher than projected.
“Departments spent less, and we were a little tighter. In addition to that, we had additional revenues that came in, so the balance brought forward was much higher than what we budgeted,” Baker said.
She pointed out that the sheriff had removed 30 additional deputies and a capital need of $33.6 million from his five-year plan in order to balance the budget.
Looking forward, Baker said if the additional $25,000 homestead exemption on the November ballot passes, it will reduce the county revenue about $27.5 million.
“We’ll start out with that loss,” she said. “In addition, we accounted for a simple majority vote on the maximum millage rate, in case we have to roll back, so based on those two significant assumptions, we would be looking at a shortfall at the simple majority vote of a roughly $70 million deficit, if all the expenditures and assumptions happen the way that we are proposing.”
If the board decided it wants to retain the 4.7815 millage rate, then the deficit would be about $64 million versus the $70 million.
“If the board decided to go to the maximum millage rate, which they could definitely do, the super-majority vote… we would be looking at a surplus of $20 million,” Baker said. “I just wanted to point out that you have options, and that would be one, and it plays out into 2021 and 2022.”
After discussion and public input, the commission recommended adding two positions to the Office of the Inspector General, as well as increased funding for court administration, the adult and juvenile reentry and guardian ad litem programs.
Mayor Melissa McKinlay thanked the county staff for including increased fire-rescue coverage in The Acreage. “They are so needed in that part of my district, and I appreciate your including them this year and cooperating with fire-rescue to meet staff recommendations,” McKinlay said.