By Chris Gerbasi
You can crunch the numbers. You can rearrange the numbers. But you can’t escape the numbers.
The Delray Beach City Commission went round and round during two lengthy — and sometimes loud — discussions of property tax rates and budget figures during its September meetings. The battle featured shouting matches, a momentary flirtation with the rollback rate and a suspenseful final vote.
When the dust settled, a supermajority of the commission came to the same bottom line: A tax rate increase was needed.
The commission on Sept. 22 voted 4-1 to approve a rate of $6.3501 per $1,000 of taxable value and a general fund operating budget of about $215 million for the fiscal year that started Oct. 1. That rate is an increase of just more than 3% over the previous tax rate. The city has now raised the tax rate for the second straight year after a dozen years of lowering the rate, culminating in 2024, when the commission approved a “no new taxes” rollback rate.
While the new tax rate is lower than the rate originally proposed to residents in August, it’s still not as low as Mayor Tom Carney would have liked.
Carney, the lone dissenting vote, said most residents he talked to had hoped the city’s tax rate would remain at least the same as the current year, $6.1611 per $1,000 of taxable value, if not lower.
“I’ve talked to a lot of people the last few weeks, I know what they’re looking for,” Carney said on Sept. 8, though only about 10 residents spoke during two public hearings. “They’re looking for us to tighten our belt.”
Rising operating costs, inflation and years of reduced tax rates contributed to the need for a tax increase, city officials said.
But the mayor argued that the city has enjoyed tremendous gains in property values — a 57% increase in its tax base over the past five years, he said — and dozens of new properties will go on the tax roll in 2027. Delray Beach property values rose 7.5% in 2026, according to the Palm Beach County property appraiser.
The commission’s decision essentially came down to a choice between maintaining the current tax rate of $6.1611 and a reserve fund balance equal to 18.9% of the city’s general fund budget, or the city manager’s proposed rate of $6.3501 that would have reserves equaling 20.27% of the budget.
The suspense at the Sept. 22 meeting grew because any amount above the rollback rate of $5.855 per $1,000 required approval by at least four of the five commissioners to pass. Carney seemed to have support from Vice Mayor Angela Burns, who said she wanted the lowest possible tax rate that would allow the city to still provide all services, but Commissioner Judy Mollica — and another commissioner — would also need to switch their stands to get the four votes needed for passage of the lower rate.
Mollica said she was undecided just before the final vote, leaving the possibility that neither rate could get the needed four votes.
If the commission had failed to pass a property tax rate, the rate would have reverted to the rollback rate, an outcome City Manager Terrence Moore said would be terrible for the city: “No can do,” he said.
Commissioner Juli Casale made a motion to assess the higher rate, which was seconded by Commissioner Tom Markert.Then came the roll call. Just a few minutes after she said she was undecided, Mollica was the first to be called to vote. She supported the motion.
When Burns’ turn came, she also voted for the higher rate, much to Carney’s surprise. Burns indicated she did not want to let “the process” of establishing tax rates dictate how the commission voted.
The vote followed an evening of bickering, led by Carney and Casale trading insults. Even the city’s chief financial officer, Henry Dachowitz, reached his boiling point when Carney interrupted him during a budget explanation.
“If you’re not going to let me answer, why should I sit here?” Dachowitz said to Carney. “I have 50 years’ experience. This is ridiculous. I’ve forgotten more than the expertise on this commission.”
Casale pressed Carney at each meeting for specific ideas about additional budget cuts, but he didn’t offer any, instead deferring to Moore.
“My plan is that the city manager will figure (it) out,” Carney said. “If we have to address numbers of personnel, then we have to address that. Every other city is doing it.”
But Casale said Delray Beach’s actions are in line with those of surrounding communities. She also emphasized the need for the city to maintain its operating reserves at 21% to 25% of total operating expenditures.
“We’re modifying our reserves to make the budget work,” Casale said. “That is not a good day-to-day practice and it’s not fiscally sound for our long-term financial future.”
Finance officials typically advise that reserves be used to cover one-time expenses. Using reserves to lower the tax rate to cover continuing expenditures makes it that much harder to balance the following year’s budget without raising taxes or dipping deeper into the reserves.
Markert shared Casale’s concerns about drawing down the reserve fund or lowering the tax rate any further, saying additional budget cuts would be “painful.”
“We have cut out all the fat and we’re now sawing through the proverbial bone,” he said.
The city’s proposed tax rate in preliminary property tax bills that went out in August was $6.4371 per $1,000 of taxable value. A commission workshop discussion on Sept. 1 resulted in trimming the rate to $6.3501.
The commission also approved a separate tax rate for voted debt. City property owners will pay $0.0289 per $1,000 to cover the debt payments, bringing the city’s combined tax rate to $6.3790 for every $1,000 of taxable value.
A Delray Beach resident with a home with a taxable value of $481,794 — the average valuation in the county — would pay $3,073 in property taxes, according to Dachowitz.
The city’s total budget — including general, special revenue, enterprise, debt service, capital and internal service funds — is about $716 million. The two largest expenditures are for police and fire rescue services. The police budget is $58.5 million, a 3.2% increase, while the fire budget went up 12.9% to about $56.5 million, largely due to salaries and benefits, officials said.
Comments