By Rich Pollack
Highland Beach commissioners last month got their first look at a proposed $28 million 2024-25 budget that includes leaving the town’s tax rate the same as in the current year.
The overall proposed budget, which includes a general fund budget and separate building fund, as well as water and sewer fund budgets, shows a reduction of about $5 million, down from $33 million in the current tax year’s budget.
The proposed general fund budget, which includes most of the day-to-day operational expenses, shows a drop of 23%, from $22.8 million to $17.5 million.
That reduction is due, in large part, to the town’s no longer having to account for construction and startup costs associated with its new Fire Rescue Department, which became operational in May.
The proposal also includes a $1 million to $1.5 million reduction in operating the town’s fire department over the estimated cost of continuing to contract with neighboring Delray Beach.
The new budget reflects the town’s intention to put a minimum of about $650,000 back into its reserves, a small repayment of the $4 million taken from reserves to build a new fire station and pay for its startup costs. It also includes an increase in water rates as well as expenses for several capital projects.
The proposed budget calls for the town to maintain a total tax rate of $3.58 per $1,000 of taxable value, including operating and debt service funds, which is the same rate as in the previous two years.
There is a proposed slight increase of $0.185 per $1,000 in the town’s operating tax rate, due largely to the increase in staffing associated with the new fire department. That is offset by a reduction in the town’s debt service tax rate, due to the elimination of its water fund debt and a reduction in its fire service debt.
“We are maintaining our low tax structure and still getting capital projects done while replenishing reserves,” Town Manager Marshall Labadie said.
Labadie said that the budget reflects a five-year plan, the blueprint on which the town has moved forward.
“All of the things we planned and executed on are coming to fruition,” he said.
While the overall tax rate will most likely remain the same — or be lowered — the current budget includes an average proposed water rate increase of about 8% that is based on the town’s five-year forecast. The water fund is budgeted at almost $5 million, while the sewer fund has a budget of about $2.5 million.
One factor enabling the town to maintain its low tax rate is an increase in taxable property value of a preliminary $317.4 million, a 9% increase but less than the 13% increase the previous tax year.
Property tax revenues account for about 76% of the general fund revenues and will increase about 7.7% or just shy of $1 million.
Police and fire protection are the major general fund expenses, with the police department’s proposed budget accounting for about $4.4 million, a jump of 28% from the current year.
The proposed budget includes a fire department expense of about $5.7 million, which is $7.5 million less than this year, when the town had to pay for construction, startup and training of its new department while paying Delray Beach for service from October to May.
Those savings, along with reductions in other areas, will help cover the cost of capital projects and strategic initiatives, including the rehabilitation of the old fire station into a community gathering place.
“We are now a stand-alone, full-service community with a bright future, a strong balance sheet and an unwavering commitment from the Town Commission,” Labadie said.
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