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FY 2026 Budget Retreat Presentation5/27/2025 1 FY 2026 Commission Budget Retreat May 27, 2025 Purpose Kick off the FY 2026 budget development process with the Mayor and City Commission Cover several budget-related topics and identify areas requiring additional attention Increase the efficiency of the 2 planned Finance & Economic Resiliency Committee (FERC) Budget Briefings in June and July 1 2 5/27/2025 2 Topics Budget Development Timeline Financial Policies Budgetary Trends and Update as of Q2 Preliminary FY 2026 Operating Budgets: General Fund Resort Tax SPOTLIGHT – Transportation & Mobility Potential Commission/Committee Enhancements Preliminary FY 2026 CIP and Capital Budget Flat Budget with CPI Cap on General Fund Next Steps in FY 2026 Budget Process Budget Development Timeline Commencement of Budget Development Process Review Budget Submissions with City Departments and City Manager City Commission establishes Budget Priorities at Budget Retreat Finance & Economic Resiliency Committee (FERC) Budget Briefings June 13th (Primarily Capital) July 11th (Primarily Operating) DECEMBER FEB - APR MAY JUN - JUL Departments Submit FY 2026 Budget Requests JANUARY 3 4 5/27/2025 3 Budget Development Timeline Cont’d Preliminary Taxable Values received from the Property Appraiser Certified Taxable Values received from the Property Appraiser City Commission meets to set Tentative Millage Rates Office of Management & Budget finalizes City’s Proposed Budget Public Hearings held to Adopt Tentative and Final City Budgets September 17th September 30th JUNE 1st JULY 1st JULY AUGUST SEPTEMBER Preliminary General Fund Budget FY 2026 $458.7 MRevenues 476.0 MExpenditures ($17.3 M)Surplus/(Gap)* (1.7M)Preliminary Decrease in Resort Tax Contribution ($19.0 M)Revised Surplus/(Gap)* Property Value Increase Necessary to Balance:**7.2% $2.6 MEstimated 1% Increase in Property Value:** **Based on Certified FY 2025 Values, pending receipt of Preliminary and Certified FY 2026 Values to be provided by Property Appraiser on June 1, 2025, and July 1, 2025, respectively *Preliminary General Fund Surplus/(Gap) above does not take into account any enhancements to be considered for FY 2026 % Increase in Expenditures from FY 2025 to FY 2026 4.4% 5 6 5/27/2025 4 Financial Policies Balancing the Operating Budget The City is responsible for maintaining a balanced budget, which is required by Florida Statute 166.241 A budget is balanced when the sum of estimated net revenues and appropriated fund balances is equal to total expenditure appropriations 7 8 5/27/2025 5 General Fund Reserves Resolution No. 2024-33340 Requirement: 17%, or 2-month, General Fund Emergency Reserve Minimum of 2 months for use in a public emergency only Requires 6/7th vote by City Commission to utilize Target: Additional 8%, or 1-month, General Fund Contingency Reserve Total Reserve Target: 25%, or 3 months, of Annual General Fund Budget Current: $114.0 million, or 3 months, of FY 2025 General Fund Budget Resort Tax Reserves Resolution No. 2019-30664 Requirement: Minimum 2-month Reserve based on 2% Resort Tax budget Minimum of 2 months for use in a public emergency only Requires 5/7th vote by City Commission to utilize Target: Additional 4-month Reserve based on 2% Resort Tax budget Total Reserve Target: 50%, or 6 months, of Annual 2% Resort Tax Budget Current: $38.3 million, or 6 months, of FY 2025 2% Resort Tax Budget 9 10 5/27/2025 6 Use of General Fund Year-End Surplus Resolution No. 2002-24764 All remaining year-end surplus, after funding reserves, should be transferred to the Capital Reserve Fund Note: This policy has been waived in previous years* * At the end of FY 2024, the remaining surplus of $11.8 million was transferred to the Fire Station 1 project Use of Non-Recurring (One-Time) Revenues ●One-time, non-recurring revenues shall be used for capital expenditures or one-time expenditures rather than to subsidize recurring personnel, operations, and maintenance costs ●Goal to fund at least 5%of the annual General Fund operating budget for capital needs Resolution No. 2006-26341 Note: This policy has been waived in previous years for specific operations such as Sanitation, Building, and Convention Center, when necessary 11 12 5/27/2025 7 Last Five Years - General Fund Capital Funding for Acquisition, Maintenance, and Replacement *Additional funds have been transferred to Capital Funds at year-end FY 2026 PRELIMINARY FY 2025 ADOPTED FY 2024 ADOPTED FY 2023 ADOPTED FY 2022 ADOPTED $476,008,000$456,164,000$427,648,000 $382,618,000 $354,106,000 Adopted General Fund 23,801,00022,809,00021,383,000 19,131,00017,706,000 5% Goal per Policy Capital Funding: $8,843,000$8,349,000$11,145,000 $3,974,000 $3,741,000 Pay-As-You-Go Capital (PayGo) 4,118,0004,368,0002,170,000 1,944,000 815,000 Capital Renewal and Replacement (CRR) 300,000300,000300,000300,000300,000Information Technology (IT) Tech 1,144,0001,144,0001,393,000326,000332,000CRR Under $25,000 978,000978,000978,000--Capital Reserve $15,383,000$15,139,000$15,986,000 $6,544,000 $5,188,000 Total* 3.2%3.3%3.7%1.7%1.5%% of General Fund $8,418,000$7,670,000$5,397,000$12,587,000 $12,518,000 Additional Funding Needed to Meet 5% Goal Adopted Millage Rates for Capital: 0.1020 mills0.1020 mills0.1020 mills0.1020 mills0.0755 millsPay-As-You-Go Capital (PayGo) 0.0866 mills0.0866 mills0.0499 mills0.0499 mills0.0235 millsCapital Renewal and Replacement (CRR) Based on Adopted FY 2025 budget, additional millage of 0.1771 mills required to reach 5% goal Budgetary Trends 13 14 5/27/2025 8 What’s a Millage Rate? Rate levied per $1,000 of assessed property value that will be used to identify your tax obligation Example: Home’s Assessed Value = $100,000 Total Adopted FY 2024 Millage Rate = 6.1481 Tax Levy: $100,000/1,000 = $100 $100 x 6.1481 Tax Obligation = $614.81 Overlapping Millage Miami Beach Note: “Other” category comprised of dedicated millage rates for Children’s Trust, South Florida Water Mgmt., Okeechobee Basin, Florida Inland Navigation District (FIND), and Everglades Project The City of Miami Beach portion of the property tax bill has decreased as a percentage of the total bill from 32.9%to 32.7%between FY 2007 and FY 2025 67%of Miami Beach residents’ tax bill goes to other agencies % of FY 2025 Total Variance from FY 2007 FY 2025 Adopted % of FY 2007 Total FY 2007 Adopted OVERLAPPING TAX MILLAGE 32.7%(1.5249)6.148132.9%7.6730 City of Miami Beach 35.1%(1.5030)6.602034.8%8.1050 School Board 28.1%(1.1037)5.2823 27.4%6.3860 Miami-Dade County Other: 2.7%0.0777 0.5000 1.8%0.4223 Children's Trust 1.4%(0.4766)0.2589 3.2%0.7355 Other 100.0%(4.5305)18.7913 100.0%23.3218 Total 35¢School Board 33¢City of Miami Beach 28¢Miami-Dade County 4¢Other 15 16 5/27/2025 9 Total Combined City Millage *Increase in FY 2020 millage attributed to issuance of Tranche 1 (Series 2019) of General Obligation (G.O.) Bonds approved by the voters on November 6, 2018 **Increase in FY 2024 millage attributed to issuance of Tranche 1 (Series 2023A&B) of Arts and Culture (G.O.) Bonds approved by the voters on November 8, 2022 6.1072 6.0572 5.9826 5.7551 5.6859 5.6009 5.6857 5.6989 5.6298 5.6298 5.6298 5.6636 5.6636 5.6636 5.6636 0.1083 0.1083 0.1083 0.1083 0.1083 0.1083 0.0235 0.0235 0.0990 0.0990 0.0990 0.0990 0.1519 0.1519 0.1886 0.2870 0.2884 0.2568 0.2529 0.2295 0.2031 0.1796 0.1664 0.1600 0.2933 0.3227 0.2889 0.2360 0.3326 0.2959 6.5025 6.4539 6.3477 6.1163 6.0237 5.9123 5.8888 5.8888 5.8888 6.0221 6.0515 6.0515 6.0515 6.1481 6.1481 5.0000 5.2000 5.4000 5.6000 5.8000 6.0000 6.2000 6.4000 6.6000 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020* FY 2021 FY 2022 FY 2023 FY 2024** FY 2025 Operating Millage Capital Millage (PayGo & CRR)Voted Debt Service (G.O. Bonds) The current total combined millage rate for FY 2025 is 5.5% less than in FY 2011 The current operating millage rate for FY 2025 is 7.3% less than in FY 2011 Overall Budget – All Funds *Adopted Capital Budgets for FY 2015 and FY 2016 included funding from multiple bond issuances for the Convention Center facility renovation and expansion project $501.9 M $576.4 M $605.0 M $611.0 M $631.4 M $669.3 M $627.1 M $675.9 M $733.1 M $829.1 M $872.4 M $728.5 M $755.4 M $88.3 M $59.8 M $48.7 M $88.4 M $60.2 M $70.4 M $73.7 M $115.7 M $74.3 M $1,230.4 M $1,331.8 M $693.3 M $670.8 M $680.0 M $757.6 M $687.3 M $746.3 M $806.8 M $944.8 M $946.7 M $0.0 K $300.0 M $600.0 M $900.0 M $1,200.0 M $1,500.0 M FY 2015* FY 2016* FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 Total Operating Budget Total Capital Budget The Overall FY 2025 Budget Increased by 0.2% over FY 2024 17 18 5/27/2025 10 General Fund Expenditure Trend General Fund expenditures have experienced a +5.1% average annual growth since FY 2007 compared to a +3.9% average annual change since FY 2007 in the Consumer Price Index (CPI)$237.7 M$230.6 M$235.4 M$226.3 M$237.5 M$244.3 M$256.3 M$264.1 M$280.1 M$300.4 M$317.3 M$330.9 M$345.6 M$350.1 M$329.0 M$354.1 M$382.6 M$427.6 M$456.2 M $0.0 K $100.0 M $200.0 M $300.0 M $400.0 M $500.0 M $600.0 M FY 2007 FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 FY 2025 Budget Highlights General Fund Totals $456.2 M Increase of $28.4 M, or 6.7% Inflation: $10.8 M, or 2.5% Enhancements (One time & Recurring): $9.2 M, or 2.2% Items Approved Mid-Year in FY2024: $0.7 M, or 0.2% Set aside for Unfunded Capital Needs/Collective Bargaining: $7.7 M, or 1.8% 19 20 5/27/2025 11 General Fund Public Safety Trend Police $75.3 M 32% Fire $43.3 M 18% Other $119.1 M 50% Public Safety as a percentage of the General Fund budget has increased from: 50%in FY 2007 to 54%in FY 2016 to 60%in FY 2025 FY 2007 General Fund $237.7 M Police $151.9 M 33% Fire $121.8 M 27% Other $182.5 M 40% FY 2025 General Fund $456.2 M Police $99.6 M 33% Fire $62.7 M 21% Other $138.0 M 46% FY 2016 General Fund $300.3 M Enhanced Public Safety Positions *All position counts reflected above exclude positions in the Office of the Mayor and City Commission Since FY 2017, the City’s “Enhanced” Full-Time Public Safety position count (Police, Fire, Code, Park Rangers, and Homeless Services) has increased by 138 full-time positions, or 13.8%, compared to the City’s Non-Public Safety Full-Time position count which has increased by 14 full-time positions, or 1.2%. 1,142 1,140 1,139 1,109 1,067 1,072 1,109 1,125 1,156 998 996 998 999 997 1,005 1,090 1,130 1,136 2,140 2,136 2,137 2,108 2,064 2,077 2,199 2,255 2,292 0 500 1,000 1,500 2,000 2,500 ADOPTED FY 2017 ADOPTED FY 2018 ADOPTED FY 2019 ADOPTED FY 2020 ADOPTED FY 2021 ADOPTED FY 2022 ADOPTED FY 2023 ADOPTED FY 2024 ADOPTED FY 2025 Total Non-Public Safety Positions*Total Enhanced Public Safety Positions 21 22 5/27/2025 12 Miami Beach Overall Property Values 18.1% 0.2% -8.2% -10.5% -0.6% 5.0% 6.9% 9.9% 13.3%13.0% 7.8% 4.0%3.1%4.1% 0.3% 11.2%10.8% 9.4% -15.0% -10.0% -5.0% 0.0% 5.0% 10.0% 15.0% 20.0% FY 2008 FY 2009 FY 2010 FY 2011 FY 2012 FY 2013 FY 2014 FY 2015 FY 2016 FY 2017 FY 2018 FY 2019 FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 Critical Factors Impacting General Fund Budget The City’s increasing unfunded capital improvement program, which totals over $1.2 billion and includes: Capital Pay-As-You-Go (PayGo) - $163.6 million Capital Renewal and Replacement (CRR) - $34.6 million Resort Tax Quality of Life (1%) - $26.8 million Long-term General Fund financial projections indicating a budget shortfalls in upcoming fiscal years The passage of Amendment 5 in November 2024, which increases the homestead exemption and further constrains the growth of taxable property values 23 24 5/27/2025 13 General Fund Where the Money Comes From…. Where the Money Comes From… Property Taxes $278.2 M 61% Resort Taxes $42.1 M 9% Property and Resort Taxes comprise 70%of Total General Fund Revenues Adopted General Fund Revenues By Category $456.2 M Other Revenues - $135.9 M (30%) Other Taxes Licenses & Permits Charges For Services Miscellaneous Non-Operating Revenues Intergovernmental Rents and Leases Interest Use of Prior Year Surplus Fines and Forfeits 25 26 5/27/2025 14 General Fund Where the Money Goes…. Where the Money Goes By Department… Police $151.9 M 33% Fire $121.8 M 27% Homeless Services $3.2 M 1% Park Ranger Program $5.1 M 1%Code Compliance $7.6 M 2% FY 2025 General Fund Expenditures By Department $456.2 M Enhanced Public Safety Police, Fire, Park Rangers, Homeless Services, and Code Compliance comprises 64%of Total Budgeted General Fund Expenditures, which exceeds Property Taxes levied for FY 2025 Other - $166.6 M (36%) Parks & Recreation Citywide Accounts Public Works Finance City Attorney CIP Planning City Manager Facilities Management Tourism & Culture Mayor & Commission Human Resources Procurement Marketing & Communications City Clerk Economic Development Housing & Community Services Environment & Sustainability Management & Budget 27 28 5/27/2025 15 Salaries and Benefits $325.5 M 71% Operating Expenditures $62.5 M 14% Internal Services $51.2 M 11% Debt and Other $17.0 M 4% Where the Money Goes By Category… FY 2025 General Fund Expenditures By Category $456.2 M Public Safety Police & Fire makes up 72% of Salaries and Benefits Expenditures Enhanced Public Safety Police, Fire, Code Compliance, Homeless Services, and Park Rangers makes up 76%of Salaries and Benefits Expenditures FY 2025 Update as of Q2 29 30 5/27/2025 16 FY 2025 Update as of Q2 Resort TaxGeneral FundProjections ($0.3 M)$6.2 MQ2 Projected Surplus/(Gap) 0.3 M(0.3 M)Adjustment in Budgeted Resort Tax Contribution to General Fund (1.2 M)Set-aside of Additional Projected Golf Courses Surplus for Miami Beach Golf Course Renovation Project $ -$4.7 MRemaining Q2 Surplus/(Gap) Recommended Use of Projected Q2 Surplus: •Set-aside remaining funds of $4.7 M for FY 2026 General Fund Reserve Requirement •Any excess after fully funding reserve levels and targets for capital needs Preliminary FY 2026 General Fund Budget 31 32 5/27/2025 17 Preliminary General Fund Budget Assumes no change in operating millage rate Includes average 2.0% merit for all groups, except 5.0% and 4.0% Steps (where applicable) for Police and Fire Assumes 8% increase in City premiums for Police and Fire health insurance (Actives and Retirees), and 5% increase in City premiums for all Non-Police and Fire health insurance (Actives and Retirees) Does not include any enhancements or reductions that were not already approved mid-year by the Mayor and Commission Includes 3.0% cost-of-living adjustments and/or changes in pays/benefits based on the City’s approved collective bargaining agreements Assumptions: Includes 2.8% increase in applicable City fees that are indexed to the Consumer Price Index (CPI) Ordinance 2019-4299 Preliminary General Fund Budget FY 2026 $458.7 MRevenues 476.0 MExpenditures ($17.3 M)Surplus/(Gap)* (1.7M)Preliminary Decrease in Resort Tax Contribution ($19.0 M)Revised Surplus/(Gap)* Property Value Increase Necessary to Balance:**7.2% $2.6 MEstimated 1% Increase in Property Value:** **Based on Certified FY 2025 Values, pending receipt of Preliminary and Certified FY 2026 Values to be provided by Property Appraiser on June 1, 2025, and July 1, 2025, respectively *Preliminary General Fund Surplus/(Gap) above does not take into account any enhancements to be considered for FY 2026 % Increase in Expenditures from FY 2025 to FY 2026 4.4% 33 34 5/27/2025 18 Preliminary General Fund Budget $$ Variances in Revenues from FY 2025 Adopted to FY 2026 Preliminary $456,164,000FY 2025 Adopted: 3,697,000 Increase in General Fund Licenses and Permit revenues from Fire, Planning, Public Works, and Finance* (2,177,000)Decrease in General Fund Franchise and Utility Tax revenues from electricity, gas, etc.* (1,695,000)Preliminary decrease in Resort Tax Contribution from $42.1 million to $40.4 million for Tourism-Eligible Expenditures based on Preliminary 2% Resort Tax Projections (Based on January 2025 study $194.4 million in tourism-eligible expenditures in General Fund) 1,346,000 Increase in General Fund revenues from Fines and Violations, Rents and Leases, and Interest Income* (313,000)Decrease in Other Miscellaneous General Fund revenues from Intergovernmental Revenues, Charges for Services, etc.* $858,000$ Variance $457,022,000FY 2026 Preliminary: 0.2%% Increase/(Decrease) *Based on prior year trends and current year projections Preliminary General Fund Budget $$ Variances in Expenditures from FY 2025 Adopted to FY 2026 Preliminary $456,164,000FY 2025 Adopted: 7,868,000Collective Bargaining Agreements Impact (5% Steps for Police/Fire and 0-3% Merits for Non-Police/Fire, 3% COLA, etc.) 7,215,000 Police/Fire Pension Impact (General Fund Portion) 3,968,000 8% Increase in City’s Premium for Health Insurance for Police/Fire and 5% for Non-Fire/Police (Actives and Retirees) 773,000 Estimated Internal Services Expenditures Impact 494,000 Additional Contribution to Pay-As-You-Go (PayGo) Capital based on 30% of projected FY 2026 General Fund interest income and Miami Beach and Normandy Shores Golf Course Surplus for MB Golf Course Project 240,000 Expenditures Approved/Added by City Commission Mid-Year of FY 2025 (Additional Support Services for City Commissioners – Reso. 2024-32956) 43,000 General Employee (MBERP) Pension Impact (General Fund Portion) (757,000)Decreases in Other Operating Expenditures based on prior year trends, current year projections, and anticipated department needs $19,844,000$ Variance $476,008,000FY 2026 Preliminary: 4.4%% Increase/(Decrease) 35 36 5/27/2025 19 Preliminary FY 2026 Resort Tax Budget Total Resort Tax Collection Trends Source: Monthly Collections Reports Published by the Finance Department *FY 2019 (Pre-COVID) monthly collections included for comparison purposes $0.0 K $2.0 M $4.0 M $6.0 M $8.0 M $10.0 M $12.0 M $14.0 M Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep FY 2019 FY 2023 FY 2024 FY 2025 37 38 5/27/2025 20 Preliminary 2% Resort Tax Budget FY 2026 $74.9 MRevenues 76.6 MExpenditures ($1.7M)Surplus/(Gap)* 1.7MPreliminary Decrease in General Fund Contribution $ -Revised Surplus/(Gap)* *Preliminary 2% Resort Tax Surplus/(Gap) above does not take into account any enhancements to be considered for FY 2026 Assumes FY 2026 revenues to remain flat over FY 2025 projections, which are based on actual collections reported as of April 2025 and revenues projected through the remainder of FY 2025 at approximately 98.4% of FY 2024 collections for the same period Preliminary 2% Resort Tax Budget $$ Variances in Revenues from FY 2025 Adopted to FY 2026 Preliminary $76,615,000FY 2025 Adopted: (1,000,000)Decrease in Use of Prior Year Resort Tax Fund Balance based on approved one-time expenditures budgeted in FY 2025 for Miami Beach Cultural Anchors and Cultural Presenters Grants (666,000) Decrease in 2% Resort Tax Collections based on projected FY 2025 2% collections (projected FY 2025 2% collections are based on actual collections through April 2025 with revenues projected through September 2025 at approximately 98.4% of FY 2024 collections) (73,000)Decrease in Interest Income and Other Miscellaneous 2% Resort Tax revenues (Filing Fees, Registration Fees, etc.) based on prior year trends and current year projections ($1,739,000)$ Variance $74,876,000FY 2026 Preliminary: (2.3%)% Increase/(Decrease) 39 40 5/27/2025 21 $$ Variances in Expenditures from FY 2025 Adopted to FY 2026 Preliminary $76,615,000FY 2025 Adopted: (1,695,000) Preliminary Decrease in General Fund Contribution from $42.1 million to $40.4 million for Tourism-Eligible Expenditures based on Preliminary 2% Resort Tax Projections (Based on January 2025 study $194.4 million in tourism-eligible expenditures in General Fund) 1,307,000Increase in Sanitation Fund Contribution for services provided in tourism areas based on the updated Resort Tax cost allocation plan completed by an outside consultant during FY 2025 using FY 2024 actuals (1,000,000)Decrease in Other Contractual Services based on the elimination of a one-time enhancement that was approved in FY 2025 for Miami Beach Cultural Anchors and Cultural Presenters Grants (255,000)Decrease in Other Miscellaneous 2% Resort Tax operating expenditures (based on prior year trends, current year projections, and anticipated department needs) (96,000)Decrease in GMCVB and VCA Contributions based on current agreement (GMCVB) and legislated formula (VCA) ($1,739,000)$ Variance $74,876,000FY 2026 Preliminary: (2.3%)% Increase/(Decrease) Preliminary 2% Resort Tax Budget SPOTLIGHT Preliminary FY 2026 Transportation & Mobility Budget 41 42 5/27/2025 22 Preliminary Transportation Budget FY 2026 $12.5 MRevenues 11.3 MExpenditures $1.2 MSurplus / (Gap)* *Preliminary Transportation Surplus/(Gap) above does not take into account any enhancements and/or reductions/efficiencies to be considered for FY 2026 Over the last several years, the Transportation & Mobility Fund has had a surplus based largely on the contribution it receives from Resort Tax 1% Quality of Life as the department no longer receives contributions from the General Fund or Parking Enterprise Fund; however, the capital projects appropriated to the fund, coupled with the upcoming purchase of new trolleys and other operating enhancements, threatens to deplete a significant amount of the fund’s current reserves FY 2026 Transportation Revenues and Expenditures $Transportation Revenues* $10.7 millionResort Tax 1% Quality of Life Contribution** 0.8 millionBus Shelter Advertising 0.7 millionInterest 0.2 millionTrolley Advertising 0.1 millionPeer Review Traffic Studies $12.5 million$ Total $Transportation Expenditures* $2.3 millionSalaries and Benefits 2.6 millionIntelligent Transportation System 2.5 millionCitywide Trolley Operations 0.7 millionMB FreeBee On-Demand Transit Services 0.5 millionTraffic Studies 0.4 millionInstallation/Maintenance of Electronic Traffic Control Devices, Signage, and Striping 0.4 millionTransportation for Special Events and Art Week 0.2 millionBicycle & Micromobility Counters, Bike Repair Stations, and Speed Feedback Signs Program 1.7 millionOther Miscellaneous Expenditures*** $11.3 million$ Subtotal 1.2 millionTransfer to Reserves/Surplus $12.5 million$ Total *Based on Preliminary FY 2026 Transportation Budget **Contribution is based on 60% of the 1% Quality of Life budget ***Miscellaneous operating expenditures include Telephone, Printing, Contract Maintenance for Various Software, Programs, and Services, Office Supplies, Other Operating Expenditures, Subscriptions, Dues and Memberships, Travel, Training and Awards, Uniform Expense, Rent for Building and Equipment, Internal Service Chargebacks, Administrative Fees, Traffic Operations/Data Collection, Grant Assistance Services, Multi-Modal Tracking Application, Trolley Stops Signage, and Mt. Sinai Link – StarCraft Van 43 44 5/27/2025 23 Current Transportation Fund Balance Trend $3.8 M$2.2 M$2.1 M$5.6 M$12.4 M$20.1 M$21.8 M$12.1 M$8.7 M $0.0 K $5.0 M $10.0 M $15.0 M $20.0 M 9/30/2017 9/30/2018 9/30/2019 9/30/2020 9/30/2021 9/30/2022 9/30/2023 9/30/2024 9/30/2025 Projected* *Projected as of Q2 of FY 2025 Decreased Levels of Service for Trolleys as a result of COVID Trolley Optimization Objective Evaluate and enhance Miami Beach’s free trolley service Identify route optimizations, vehicle improvements, and operational efficiencies The trolley system is well-utilized and receives 88% satisfaction from riders Service reliability issues due to long headways, vehicle bunching, and mechanical failures Current trolleys are inefficient for high ridership, leading to frequent breakdowns Route redundancies exist, particularly in Middle Beach and North Beach Reduce route lengths to achieve 10-12 min headways (high-frequency transit standard) Reconfigure North Beach & Middle Beach routes for direct, faster trips Eliminate underutilized stops & route deviations to streamline service Replace current trolleys with 30-ft, 2-door low-floor heavy-duty transit vehicles (ex. Gillig Trolley) Key Points Optimizations for consideration 45 46 5/27/2025 24 Potential Impacts to Transportation Fund Balance Transportation & Mobility Hybrid Trolley (with Enhanced Service Levels) Hybrid Trolley (at Current Service Levels) Diesel Trolley (at Current Service Levels) $8.7 million$8.7 million$8.7 millionProjected Available Balance as of 9/30/2025* 1.2 million1.2 million1.2 millionPreliminary FY 2026 Surplus/(Gap) 9.9 million9.9 million9.9 millionProjected Available Balance as of 9/30/2026 0.8 million0.8 million0.8 millionProjected FY 2027 Surplus/(Gap) (24.0 million)(5.0 million)(2.7 million)Incremental Cost for Next-Gen Municipal Circulator** ($13.3 million)$5.7 million$8.0 millionProjected Available Balance as of 9/30/2027 *Projected as of Q2 of FY 2025 **Costs associated with the next-generation municipal circulator will vary depending on fuel types, vendors, and service levels.The costs reflected above are not representative of the full costs but rather reflect the incremental costs over and above the current service level budget. These projections exclude all capital project requests for the Transportation & Mobility Fund, as well as any enhancement requests that may be considered in future years Revised Transportation Fund Balance Trend $2.2 M$2.1 M$5.6 M$12.4 M$20.1 M$21.8 M$12.1 M$8.7 M$9.9 M$5.7 M$994.7 K $0.0 K $5.0 M $10.0 M $15.0 M $20.0 M 9/30/2018 9/30/2019 9/30/2020 9/30/2021 9/30/2022 9/30/2023 9/30/2024 9/30/2025 Projected* 9/30/2026 Projected* 9/30/2027 Projected* 9/30/2028 Projected* *Projected as of Q2 of FY 2025 and the FY 2026 Preliminary Budget Assuming FY 2027 Commencement of Next- Generation Municipal Circulator (Hybrid Trolley at Current Service Levels) 47 48 5/27/2025 25 Potential FY 2026 Enhancements Commission & Committee Priorities Commission One-Time Enhancements Resolution #/MeetingYear 2 $ FY 2027 Year 1 $ FY 2026FundCommission Items 5/20/24 Budget Workshop$ -$4,000,000 General FundHigh Visibility Overtime (Alternative Option - $1,800,000) Reso. 2024-33198 -400,000 Resort TaxMarch Fitness Festival Large Scale Event Reso. 2025-33524 -363,000 PW UtilitiesNorth Beach Hydraulic Evaluation Reso. 2025-33569 -160,000 TransportationFeasibility Study on Use of Middle Turn Lane as a Reversible Lane on 41 st Street Reso. 2025-32538486,000 150,000 Transportation63rdStreet Bridge Replacement with Flyover Feasibility Study (Phase I and II) Reso. 2025-33525 -138,000 SanitationRelocation of Sanitation Operations Office in 17th Street Garage Study 5/21/25 Commission Mtg.-132,000 General FundPilot Program for Blue Light Safety & Emergency Communication System Reso. 2025-33467 -121,000 Resort TaxFIU-Wolfsonian Audio-Visual Equipment Upgrade 5/21/25 Commission Mtg.-120,000 General FundShade Structure at the Miami Beach Senior High School Field $486,000$5,584,000 Sub-Total A comprehensive list of all enhancement requests to be considered in the FY 2026 budget will be presented at the upcoming Finance & Economic Resiliency Committee Budget Briefing in July 2025. 49 50 5/27/2025 26 Commission One-Time Enhancements Cont’d Resolution #/MeetingYear 2 $ FY 2027 Year 1 $ FY 2026FundCommission Items $486,000$5,584,000 Sub-Total from Previous Slide Reso. 2025-33552 -100,000 TransportationEvaluation of Bulb-out Removals on 40th Street Between Prairie and Pine Tree Drive Reso. 2024-33383 -86,000 TransportationSchool Speed Detection Systems (Phase II) Traffic Study Reso. 2025-33581 -75,000 Resort TaxGrant to Vision Frame, LLC for Lapidus: Architect of Joy Documentary Production Reso. 2025-33542 -72,000 General FundComprehensive Resident and Workforce Survey 5/21/25 Commission Mtg.-35,000 General FundPark View Island Garden Project 5/21/25 Commission Mtg.-10,000 Resort TaxWomen's History Month Grant Reso. 2025-33628 -5,000 General FundOpen Heart, Inc. Grant $486,000 $5,967,000 Total Commission One-Time Enhancements A comprehensive list of all enhancement requests to be considered in the FY 2026 budget will be presented at the upcoming Finance & Economic Resiliency Committee Budget Briefing in July 2025. Committee One-Time Enhancements Resolution #/MeetingYear 2 $ FY 2027 Year 1 $ FY 2026FundCommittee Items FERC – 12/20/2024 $ -$1,500,000 Resort Tax2026 FIFA World Cup Sponsorship FERC – 5/7/2025 -78,000 Resort TaxProjection Mapping Event in Canopy Park for Halloween 2025 FERC – 5/7/2025 -75,000 Resort TaxParaiso Miami Swim Week Sponsorship $ -$1,653,000 Total Committee One-Time Enhancements A comprehensive list of all enhancement requests to be considered in the FY 2026 budget will be presented at the upcoming Finance & Economic Resiliency Committee Budget Briefing in July 2025. 51 52 5/27/2025 27 Commission Recurring Enhancements Resolution #/MeetingYear 2 $ FY 2027 Year 1 $ FY 2026FundCommission Items Reso. 2025-33459 $1,238,000 $1,298,000 General FundATV/Beachwalk Squad (One Sergeant and Five Police Officers ) Reso. 2025-33459 1,238,000 1,298,000 General FundMarine Patrol Squad (One Sergeant and Five Police Officers ) Reso. 2025-33459 1,238,000 1,298,000 General FundDUI Traffic Enforcement Squad (One Sergeant and Five Police Officers ) Reso. 2025-33631 1,230,000 1,230,000 PW UtilitiesStormwater Rental of By-Pass Pumps and Vactor Trucks Reso. 2023-32645 600,000 600,000 TransportationCross-Bay Water Taxi Service Reso. 2025-33602 581,000 581,000 Internal ServiceAdding Fertility Treatment Services to the Medical Benefits Reso. 2025-33516 508,000 403,000 General Fund South Shore Community Center Summer Camp and Year-round Programming (incl. Three Full-Time and Eleven Part-Time Positions) (Summer Camp ONLY - Year 1 $257,000, Year 2 $317,000) 5/21/25 Commission Mtg.400,000 400,000 General FundAdditional Funding for the Job Creation Incentive Program Reso. 2025-33489 336,000 336,000 TransportationTwo (2) Additional FreeBee On-Demand Transit Service Vehicles $7,369,000$7,444,000 Sub-Total A comprehensive list of all enhancement requests to be considered in the FY 2026 budget will be presented at the upcoming Finance & Economic Resiliency Committee Budget Briefing in July 2025. Commission Recurring Enhancements Cont’d Resolution #/MeetingYear 2 $ FY 2027 Year 1 $ FY 2026FundCommission Items $7,369,000$7,444,000 Sub-Total from Previous Slide Reso. 2025-33509 200,000 300,000 General FundAxon Fusus Real-Time Crime Center Platform Reso. 2025-33480 143,000 140,000 General FundPreK Scholarship Program Expansion and Part-Time Scholarship Program Admin. 5/21/25 Commission Mtg.120,000 120,000 Resort TaxAdditional Holiday Lighting Add Ons & Repairs 5/21/25 Commission Mtg.151,000 120,000 General FundFull-Time Principal Planner Position Reso. 2025-33570 100,000 100,000 TransportationMaintenance of Green Bicycle Lanes Reso. 2024-33156 113,000 90,000 ParkingResidential Parking Permit Decal Program (incl. One Full-Time Position) Reso. 2024-33222 103,000 80,000 ParkingNorth Beach Restricted Residential Parking Permit Zone (Zone 26) (incl. One Full-Time Position) Reso. 2025-33595 60,000 60,000 General FundStyle Saves Grant $8,359,000 $8,454,000 Sub-Total A comprehensive list of all enhancement requests to be considered in the FY 2026 budget will be presented at the upcoming Finance & Economic Resiliency Committee Budget Briefing in July 2025. 53 54 5/27/2025 28 Commission Recurring Enhancements Cont’d Resolution #/MeetingYear 2 $ FY 2027 Year 1 $ FY 2026FundCommission Items $8,359,000 $8,454,000 Sub-Total from Previous Slide Reso. 2025-33561 55,000 55,000 General FundPartnership with Beachfront Concessionaires for Event Specific Umbrella Program Reso. 2025-3355945,000 45,000 PW UtilitiesStorm Water Influence Index (incl. Two Part-Time Excellence Assessors) Reso. 2025-33625 35,000 35,000 General FundTen (10) Advance Mobile ALPR and in Car Video Solution Reso. 2025-33497 25,000 25,000 Resort TaxSouth Beach Seafood Festival (Renewal of Agreement for 5 Years) Reso. 2025-33575 15,000 15,000 General FundPTA and Private School Equivalent Ancillary Markets Fundraising 5/21/25 Commission Mtg.2,000 2,000 General FundWeekly Bingo Nights at Federation Towers 5/21/25 Commission Mtg.TBD TBD General FundOne (1) Full-Time Civilian Technology-Based Position to Support Real- Time Intelligence Center Integration and Automated Surveillance Alerts 5/21/25 Commission Mtg.TBDTBDGeneral FundEnhanced Enforcement of Illegal Vehicular Muffler/Exhaust Noise Citywide $8,536,000 $8,631,000 Total Commission Recurring Enhancements A comprehensive list of all enhancement requests to be considered in the FY 2026 budget will be presented at the upcoming Finance & Economic Resiliency Committee Budget Briefing in July 2025. Committee Recurring Enhancements Resolution #/MeetingYear 2 $ FY 2027 Year 1 $ FY 2026FundCommittee Items PSNQLC – 5/14/2025 $393,000 $422,000 General FundLong-Term Public Safety Plan for the Baywalk (Two Full-Time Sworn Positions) FERC – 1/24/2025 215,000 215,000 General FundAugmenting Marketing Budget Specifically Dedicated to Economic Development FERC – 3/26/2025 130,000 130,000 General FundExtension of Wraparound Palm Tree Lighting on 71st Street to the East of Normandy Fountain and Collins Avenue PSNQLC – 5/14/2025 55,000 55,000 General FundLincoln Road BID Sponsorship for Annual Mardi Gras Festival PSNQLC – 5/14/2025 27,000 27,000 General FundMonthly Community Activations on West Lot Number Four $820,000 $849,000 Total Committee Recurring Enhancements A comprehensive list of all enhancement requests to be considered in the FY 2026 budget will be presented at the upcoming Finance & Economic Resiliency Committee Budget Briefing in July 2025. 55 56 5/27/2025 29 Potential Commission and Committee Enhancements Year 2 $ FY 2027 Year 1 $ FY 2026Summary by Fund $6,103,000 $10,637,000 General Fund 145,000 2,404,000 Resort Tax 1,275,000 1,638,000 PW Utilities (Water/Sewer/Stormwater) 1,522,000 1,532,000 Transportation 581,000 581,000 Internal Service (Medical/Dental) -138,000 Sanitation 216,000 170,000 Parking $9,842,000 $17,100,000 Total Commission and Committee Enhancements A comprehensive list of all enhancement requests to be considered in the FY 2026 budget will be presented at the upcoming Finance & Economic Resiliency Committee Budget Briefing in July 2025. Preliminary FY 2026 Capital Budget 57 58 5/27/2025 30 FY 2026-2030 Capital Improvement Plan TOTALFY 2030FY 2029FY 2028FY 2027FY 2026FUND TYPE (in millions) $346.5$31.8$65.0$28.5$116.3$104.9Water & Sewer 323.6--78.0243.22.4General Obligation (GO) Bonds* 253.825.454.432.6123.717.7Stormwater 186.78.89.642.145.780.5Pay As You Go (PAYGO) 56.70.83.41.08.742.8Parking/Garages 52.613.46.89.510.612.3Fleet Management 41.4-3.44.019.614.4Convention Center 38.90.33.03.47.025.2Capital Renewal & Replacement (CRR) 35.70.21.15.310.418.7Resort Tax Quality of Life (1%) 27.3--2.523.11.7Transportation 8.10.10.30.30.37.1Other Capital (incl. RDA Funds & Capital Reserves) $1,371.3$80.8$147.0$207.2$608.6$327.7TOTAL *FY 2026 G.O. Bond Projects include requests which would expend old G.O. Bond funds/interest Commission Capital Project Requests Resolution #/Meeting$Commission Items Commission Meeting – 12/11/2024 $25,935,06572ndStreet Community Complex (Additional Funding for GOB project) Resolution #2025-3357313,104,250Collins Avenue 63rd - 87 th Terr. Lighting & Sidewalk Improvements Commission Meeting – 05/21/20256,530,000Marine Science Education Center & Museum (7605 Collins) Resolution #2025-335926,000,000Euclid Circle Park (FY 2030) Resolution #2024-334355,241,700Collins Avenue 5th - 15 th Street Lighting & Sidewalk Improvements Resolution #2025-334955,100,000Lummus Park Critical Infrastructure Resolution #2024-334464,560,13041stStreet Corridor (Additional Funding for GOB project) Commission Meeting – 05/21/20252,341,000Sunset Island II Park Improvements Resolution #2025-33469800,000Fleet Management Solar Panels Resolution #2024-33117792,360Citywide Raised Crosswalks & Intersections Resolution #2025-33462400,000Alton Court Alley Resolution #2025-33626250,000Marine Park (Design/Permitting/Planning) Resolution #2025-3350581,000Meridian Avenue Traffic Calming (42nd – 47 th Street) $71,135,505TOTAL 59 60 5/27/2025 31 Budget Gap Summary (General Fund & Resort Tax) Est. Millage Impact ($) Est. Millage Impact Difference ($M) Available Funding ($M) Total Request ($M) Fund $9411.2087($57.5)$23.0$80.5PAYGO 3430.4398(20.9)4.325.2CRR 1600.2060(9.8)8.918.7Resort Tax Quality of Life (1%) $1,4441.8545($88.2)$36.2$124.4Total FY 2026 Requests Average value of Homesteaded Property - $778,877 Source: Miami-Dade County Property Appraiser's average-median-homestead-residential-values file Budget Gap Summary (Water & Sewer) FY 2026 $104.9 MProject Requests 5.3 MAvailable W&S Funds ($99.6 M)Unfunded Projects *Total Water & Sewer Fund Renewal & Replacement Reserve is $15.7 M 61 62 5/27/2025 32 Preliminary FY 2026 Budget Recap Preliminary General Fund Budget FY 2026 $458.7 MRevenues 476.0 MExpenditures ($17.3 M)Surplus/(Gap)* (1.7M)Preliminary Decrease in Resort Tax Contribution ($19.0 M)Revised Surplus/(Gap)* Property Value Increase Necessary to Balance:**7.2% $2.6 MEstimated 1% Increase in Property Value:** **Based on Certified FY 2025 Values, pending receipt of Preliminary and Certified FY 2026 Values to be provided by Property Appraiser on June 1, 2025, and July 1, 2025, respectively *Preliminary General Fund Surplus/(Gap) above does not take into account any enhancements to be considered for FY 2026 % Increase in Expenditures from FY 2025 to FY 2026 4.4% 63 64 5/27/2025 33 Preliminary 2% Resort Tax Budget FY 2026 $74.9 MRevenues 76.6 MExpenditures ($1.7M)Surplus/(Gap)* 1.7MPreliminary Decrease in General Fund Contribution $ -Revised Surplus/(Gap)* *Preliminary 2% Resort Tax Surplus/(Gap) above does not take into account any enhancements to be considered for FY 2026 Assumes FY 2026 revenues to remain flat over FY 2025 projections, which are based on actual collections reported as of April 2025 and revenues projected through the remainder of FY 2025 at approximately 98.4% of FY 2024 collections for the same period Fiscal Responsibility per April 23, 2025 Commission Referral (C4 Y) 65 66 5/27/2025 34 Preliminary FY 2026 Budget Highlights General Fund Totals $476.0 M ○Increase of $19.8 M, or 4.4% Inflation: $19.6 M, or 4.3% Items Approved Mid-Year in FY 2025: $0.2 M, or 0.1% Impact of CPI Cap on General Fund Budget FY 2026 $468.9 MGeneral Fund Budget Indexed to CPI 476.0 MCurrent Preliminary General Fund Budget* ($7.1 M)$ Decrease in Current Preliminary Budget *Based on December-to-December CPI for the Miami-Fort Lauderdale-West Palm Beach area (2.8%) By indexing the General Fund Budget to the Consumer Price Index (CPI), current Preliminary FY 2026 Expenditures would need to be reduced by approximately $7.1 million with no enhancements being added to the FY 2026 General Fund budget. 67 68 5/27/2025 35 Annual General Fund Budget Comparison to CPI The difference between the FY 2025 Adopted General Fund Budget and CPI Indexed General Fund Budget is approximately $4.3 million. Since FY 2020, a total of $22.3 million of recurring General Fund enhancements have been approved.Adopted Gen Fund BudgetAdopted Gen Fund BudgetAdopted Gen Fund BudgetAdopted Gen Fund BudgetAdopted Gen Fund BudgetGen Fund Budget Indexed to CPIGen Fund Budget Indexed to CPIGen Fund Budget Indexed to CPIGen Fund Budget Indexed to CPIGen Fund Budget Indexed to CPI $0.0 K $50.0 M $100.0 M $150.0 M $200.0 M $250.0 M $300.0 M $350.0 M $400.0 M $450.0 M $500.0 M FY 2020 FY 2021 FY 2022 FY 2023 FY 2024 FY 2025 $350.1 M $329.0 M $353.6 M $354.1 M $382.6 M $427.6 M $456.2 M $373.8 M $409.7 M $440.0 M $451.9 M Distribution of City Taxes Levied by Property Type Homestead properties benefit from the Save Our Homes cap, which limits annual increases in assessed value—this contributes to their smaller share of the overall tax levy. Non-homestead properties, including commercial, second homes and investment properties, play a critical role in supporting the General Fund due to their higher taxable value and lack of assessment caps. Residential Homestead 20.8% Residential Non-Homestead 56.3% Commercial 18.0% Other* 4.9% *Other category is comprised of vacant lots, industrial, and other miscellaneous property types. FY 2025 69 70 5/27/2025 36 Recommendations on Mitigating Budget Growth Prioritize core services and programs and assess which programs or expenditures could be eliminated or scaled back Continue our pragmatic approach of involving a combination of strategic expenditure reductions, revenue optimizations, and cost-containment measures Enact legislation regarding adding expenditures that will have a fiscal impact outside of the annual budget process, with a requirement for a strategic discussion of what program(s) could be eliminated/reduced, or new revenues generated to support anything approved mid-year, unless the City meets the 5% annual funding for capital needs goal Keep in mind that recurring items impact the future annual budgets on a recurring basis and one-time items reduce how much we can transfer to capital at year end Consider reducing the number of fee waivers and in-kind City services for events (since FY 2020, approximately $4.9 million in fees waived and unreimbursed in-kind city services) Require special event fee waivers and certain sponsorships to be for no more than three (3) years, unless the event is scheduled during off-peak season Transfer all or a percentage of projected surplus dollars (during the budget development process) over and above the Current Service Level (“CSL”) budget to support capital projects until the City can meet the 5% annual funding for capital needs goal and/or budgeting for addition to reserves based on increase in the General Fund budget Next Steps in FY 2026 Budget Process 71 72 5/27/2025 37 Next Steps in FY 2026 Budget Process 1st FERC Budget Briefing (Capital Budget) 2nd FERC Budget Briefing (Operating Budget) Set Maximum Millage Rates per Truth-In- Millage (TRIM) City Manager & OMB Finalize Proposed Budget First Public Hearing Adopt Tentative Millage Rates & Budgets (Operating & Capital) Second Public Hearing to Adopt Final Millage Rates & Budgets (Operating & Capital) Commencement of Fiscal Year 2026 JUNE 13th (Primarily Capital) JULY 11th (Primarily Operating) JULY 23rd AUGUST SEPTEMBER 17 th SEPTEMBER 30th OCTOBER 1st Thank you!!! 73 74