By Rich Pollack
Highland Beach property owners will see a slight reduction in the town’s overall tax rate when they receive tax bills this month, even as the community expects close to $450,000 in additional costs associated with the creation of a new fire department.
Thanks in part to a housekeeping move that shifted a portion of debt service that had been paid by tax revenue to a fund generated by water and sewer revenues, Highland Beach commissioners were able to reduce the overall tax rate for the 2021-22 budget year by about 4%.
As a result, the town’s overall tax rate dropped from $3.78 per $1,000 of taxable value to $3.62. The operating tax rate of $3.22 per $1,000 of taxable value remained unchanged while the debt service rate dropped from 55 cents to 39 cents per $1,000 of taxable value.
“I think it’s great that we don’t have to raise the tax rate,” Vice Mayor Natasha Moore said.
With the reduction in the overall tax rate, the owner of a home in Highland Beach with an assessed value of $750,000 will see a drop of about $124 a year, assuming no increase in assessed value. But home values on average rose 3.3% this year in Highland Beach, the property appraiser says.
The town’s general fund budget, which excludes revenues from water and sewer payments as well as money received from building permits and sales surtax revenue, increased by $741,500 or about 6% to a little more than $13 million.
As is usually the case, the bulk of the town’s revenues, 73% or about $9.5 million, will come from property taxes.
To help balance the budget, town commissioners pledged to take about $455,000 from the general fund’s unrestricted reserves. That still leaves about $6 million in reserves, an amount that percentage-wise is considered larger than those of comparable municipalities.
Moore pointed out that for several years the town has planned to use reserves but didn’t need to.
“By the end of the year, we’ve actually added to reserves,” she said.
Once again, the town’s largest expense is expected to be public safety with the cost of operating the police department to be about $2.86 million, up about 6% over the 2020-21 budget.
The cost of fire service for the town is budgeted to be about $5.5 million, with about $5 million going to Delray Beach as part of its contract to staff the town’s fire station.
An additional $15,000 is budgeted to provide improvements to the fire station and about $440,000 to cover the cost of consultants helping to create a new fire department and hire a fire chief, which the town hopes to do in the next fiscal year.
The town also expects to spend about $160,000 for administrative services that will be necessary with the expansion of the overall town staff once a town-run fire department is operational.
Helping to offset that expense are a reduction in the cost of insurance as a result of a change in companies and a reduced cost of health insurance for employees.
While the town recently increased its water and sewer rates, an unanticipated $980,000 from the American Rescue Plan Act received in September combined with a similar amount expected in 12 to 18 months could help to temper future water and sewer rate increases.
Those federal dollars, town officials say, will most likely be used to cover the cost of water and sewer capital improvements, including about $1 million in enhancing sewer lines.
Comments