By Connor Walter Brickel and Larry Barszewski
Boynton Beach commissioners didn’t hold the line on the city’s property tax rate this year. They dug deeply into it.
While officials in some towns and cities feel they’ve done a good job if they’re able to keep the tax rate the same as the previous year — or if they make a small reduction in the rate that leads to a tax increase anyway — Boynton Beach commissioners went all in.
They committed to cutting the tax rate and they didn’t stop at the rollback — the “no new taxes” rate that the state suggests municipalities should aim for — but went almost 3% below that rate.
The result: City property owners will pay more than a half-dollar less in city taxes for each $1,000 of taxable property value. The unanimous commission on Sept. 16 dropped the previous rate of $7.75 per $1,000 to $7.2052 per $1,000 for the fiscal year starting Oct. 1, a drop of 7%.
The owner of a property with a taxable value of $250,000 will pay $1,801 in city taxes this year, a drop of about $75 from the previous year.
The move comes as the city, which had the fourth-highest tax rate among Palm Beach County’s 39 municipalities, considers other options for cost savings. It has been in discussions to explore the possibility of having the county take over its fire rescue services and its water utility, and it has broached the idea of teaming up with Ocean Ridge to set up a water authority that would also remove the utility and its increasing costs from the city’s budget.
Going under roll back will require the city to draw about $1.8 million from its reserves to balance the city’s $138.3 million general fund budget, according to city officials.
“This year’s budget was very, very tight and there’s no juice left to squeeze right now in that lemon. We’re not possible to find that 1.8 where we are right now,” Chief Financial Officer Alan Lawson said. “So we’re looking at drawing that money out of fund balance in order to facilitate this new proposed rate.”
Commissioners shared concerns over drawing from the city’s operating reserves, which Lawson said sit at around $33 million.
“I know that we’ve been doing a great job with increasing our fund balance, but I feel like every time we turn around, we’re taking a little bit out of fund balance to make up a difference for here and there,” Commissioner Aimee Kelley said.
Currently, the reserves allow the city about three to five months of operating costs, according to City Manager Daniel Dugger.
The commission also approved increasing the fire assessment by $25, to $170 annually starting Oct. 1. That will bring in an additional $1.7 million in revenue.
“When the City chose to adopt the rollback rate, the increase in the fire assessment helped offset part of the property tax revenue the general fund would otherwise have lost,” Deputy City Manager Andrew Mack wrote in an email to The Coastal Star.
The new budget also assumes that a hiring freeze on all general fund positions — which are paid for with property tax dollars — remains. Under the adopted budget, open positions within the city will be harder to fill.
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