R7F-Set Proposed Millage Rates For Fiscal Year 2014-15COMMISSION ITEM SUMMARY
lntended Outcome
ltem Summary/Recommendation :
FS 200.065, entifled "Method of Fixing Millage" establishes specific guidelines that must be used by all local
govemment entities in setting millage (property tax) rates. Under the statute, the City is required, within 35 days of
receipt of the "Certification of Taxable Value" (received July 1, 2014),lo advise the Miami-Dade County Property
Appraiser of the proposed general operating millage rate, the calculated "rolled-back" rate and the date, time, and
place of the first public hearing to considerthe proposed millage rates and tentative budgets forFY 2014115. The
required Debt Service millage rate must also be set at the same time as the General Operating millage.
After setting the proposed operating millage rate, the Commission may, at any time prior to the final adoption, lower
the rates by adjusting priorities. However, increasing the millage rate may only be accomplished by an expensive
mailing and advertising process to every property owner on Miami Beach. The City's proposed operating millage
rate as well as that of other taxing authorities will be included in the Truth-in-Millage (TRIM) statement sent to each
property owner in the City on August 24'n by the Property Appraiser.
The total proposed operating millage rate for FY 2014t15 is 6.0929 mills, which represents a slight decrease from
the FY 2013114 rate of 6.1163 mills. The total proposed millage rate of 6.0929 includes a general operating millage
rate of 5.7551 and a Capital Renewal and Replacement millage of 0.1083. The proposed voted debt service millage
rate is reduced from 0.2529 to 0.2295. The budget development process is still underway, and the City's Proposed
Work Plan and Budget will be released later this summer. However, at this point in time, the surplus between
cunent service level revenues and expenditures is estimated at $2.45 million primarily due to an increase in
property values of 10.3 percent (net of City Center RDA). The Current Service Level (CSL) budget represents the
cost of providing the same level of service as in the prior fiscal year.
The proposed millage provides funding to offset increases to the CSL Budget in employee costs such as a 3
percent Cost of Living Adjustment (COLA); a 2 percent performance-based merit increase; additional steps for
Police Officer, Police Sergeant, Police l-ieutenant, Firefighter I positions as well as implementation of hazardous
duty pay; higher health care costs; the impact of annualized costs for items added during FY 2013114; higher
operating costs; and internal service fund charge-backs.
*aeYn* ilEil Rl F
Condensed Title:
RESOLUTION OF THE MAYOR AND CITY COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA SETTING
)THE PROPOSED OPERATING MILLAGE RATE; 2) THE REQUIRED DEBT SERVICE MILLAGE RATE; 3) THE
CULATED "ROLLED-BACK', RATE;AND,4) THE DATE, TIME, AND PLACE OF THE FIRST PUBLIC HEARING
CONSIDER THE MILLAGE RATES AND BUDGETS FOR FISCAL YEAR (FY) 2014115; FURTHER
HORIZING THE CITY MANAGER TO TRANSMIT THIS INFORMATION TO THE MIAMI.DADE COUNTY
RTY APPMISER IN THE FORM REQUIRED BY SECTION 200.065, FLORIDA STATUTES
Ensure expenditure trends are sustainable over the long term
Supporting Data (Surveys, Environmental Scan, etc.):
ln the 2014 Community Survey, both residents and businesses reported the following area for the City related to
value for taxes paid:
, Percentage of residents rating the Overall Value of City services for tax dollars paid as excellent or good
(Residents: 58%; Businesses 54%)
Financial I nformation:
iource of Funds:Amount Accountt(4itOB.H
1
'otal
Financial lmpact Summary The July 1,2014 Certification of Taxable Value from the Miami-Dade County
Property Appraiser reflects a 9.9 percent increase in Citywide property tax values from the July 1,2013 tax roll
certification. Given that the City Center RDA had an 8.1 percent increase, the increase outside the City Center
RDA, which impacts the City's General Fund revenues, was 10.3 percent. The proposed millage for the FY 2014115
budqet results in increased propertv tax revenues in the General Fund of $14.3 million.
(s MIAMI BTACH DArG 1-23 _ly868
E MIAMIBEACH
City of Miomi Beoch, 'l 700 Convention Center Drive, Miomi Beoch. Florido 3313g, www.miomibeochfl.gov
COMMISSION MEMORANDUM
Mayor Philip Levine and Members the City
Jimmy L. Morales, City Manager
July 23,2Q14
A RESOLUTION OF THE MA
MIAMI BEACH, FLORIDA
RATE; 2) THE REQUIRED DEBT SERVICE MILLAGE RATE; 3) THE cALcULATED.,ROLLED-BACK,,RATE; AND,4) THE DATE, TIME, AND PLAGE oF THE FIRSTPUBLIC HEARING TO CONSIDER THE MILLAGE RATES AND BUDGETS FOR
FISCAL YEAR (FY) 2O14If 5; FURTHER AUTHORIZING THE cITY MANAGER ToTRANSMIT THIS INFORMATION TO THE MIAM!.DADE COUNTY PROPERryAPPRAISER IN THE FORM REQUIRED BY SECTION 200.065, FLORIDA
STATUTES.
The Administration recommends that the Mayor and City Commission adopt the attachedresolution which authorizes the City Manager totransmit the following information to the Miami-Dade County Property Appraiser:
1) Proposed Millage Rates for Fy 2O14t1S:
General Operating 5.7551 mills
Capital Renewal & Replacement 0.,,t0g3 mills
sub-Total operating Millage ss634 mills (same as last year)
Voted Debt Service 0.2295 miils iO.OZe+ decreise from last year)Total 6.0929 mills (0.0234 decrease from last year)
2) "Rolled-Back" Rate (Truth in Millage) 5.1076 mills
3) The first public hearing to consider the proposed millage rates and tentative budgets for Fy
2014115 shall beW_e!ry909y, September 10, 2014
^
5:01 p.m., in the City Commissionchambers, city Hall, 1700 convention center Drive, Miami lieach, Florida.
The "Rolled-Back" millage rate for FY 2014t15 is the millage rate required to produce the same
fev_elof property tax revenues in the General Fund in FY ,014h5 as anticipaied to be receivedin FY 2013114. lt is important to note, that the January 1,2013, tax roll CitywiOe declined byalmost $1 .02 billion (4.1%) between the July 1, 2013 viluation and the July 1 , 21l1valuation
!1e_!o_aogeals, adjustments, etc, which is part of the reason the Fy 201411's "roll-back rate" is0.7558 mills lower than the FY 2013114 current millage rate and lower than it would be if therollback rate was only adjusted for the increase in ievenues generated by higher property
values. The area outside- of City Center RDA, which impacts General Fund revinues, declined invalue by approximately 90.24 billion during the same period of time.
TO:
FROM:
DATE:
SUBJECT:AND CITY COMMISSION OF THE CITY OF
1) THE PROPOSED OPERATTNG MTLLAGE
869
FY 2014/15 ProPosed Millage Rate
July 23,2014
Page 2
The proposed millage provides funding to offset increases to the Current Service Level Budget
in employee costs-such as a 3 pertent Cost of Living Adjustment (COLA); a 2 percent
perforinai.,ce-based merit increase; additional steps for Police Officer, Police Sergeant, Police
Lieutenant, Firefighter I positions as well as implementation of hazardous duty pay; higher health
care costs; the impact oiannualized costs for items added during FY 2013/14; higher operating
costs; and internal service fund charge-backs.
SUMMARY
ln Fy 2O1Ot11 the city's approach to addressing the then deficit of $32 million included a
distribution of the sno'rtratt between taxpayers and employees. Taxpayers had their tax rate
increased from 5.6555 to 6.2155, an incre-ase of 0.56 mills. The goal of the Commission has
been to bring them back to that level as property values increase over time. lt should be
remembered that between Fy 2009/10 and FY 2010/11 values declined by $2.0 billion driving
the need for an increase in the millage'
ln Fy 201 1t12 the city took its first step in that direction with a reduction in the millage rate of
0.0S mius. The mittaje rate for FY zotztl3 reduced the operating Ti1?99 by an additional
0.0746 mills. ln the iv Zol3/14 budget, the millage ratewas reducedo.2275 mills. Overthree
y"rrr, this reduction represents 63 p=ercent of the goal to get back to a millage rate of 5.6555'
The remaining goalfor millage reduction is 0.2079'
The Administration is recommending a total combined millage rate forthe City of Miami Beach of
6.0929, which represents a stight 6"creas" of 0.0234 mills. The total proposed operating
miltage'has been keptflatand in-ctudes a generaloperatin_g millage rate of 5.7551 and a General
FunjCapital Renewal and Replacemenimillage of 0.1083. The proposed voted debt service
millage rate is adjusted from 0.2529 to 0.2295, a decrease of 0'0234mills'
It is important to remember that in prior years, 19 C-i!y-of lrliami Beach significantly reduced-tax
rates as property values increased'. Between FY 1999/00 and FY 2009/10, total combined City
of Miami Be'ach-property tax rates declined approximately 2.8 mills. ln FY 2007108 alone, the
,irrrg" rate declined 'oy approximately 1.8 mills, with annual savings to the average
homesteadeO property o? or"r $400. Further, despite an adjustment of 0..56 mills in the
operating tax rate in rV zoto 111, CiW of Miami Beacl'r proposed combined millage rates today
remain more than 2.6o5j miils loweithan in FY 1999/oo (30 percent), and 1.5801 mills lower
than 2006i07 (20.6%).
The budget development process is still underway, and the city's Proposed work Plan and
eudget 'iitt Ou released later this summer. However, at this point in time,.the s.urplus between
current seryice level revenues and expenditures is estimated at $2.45 million primarily due to an
increase in property values of 1 0.3 peicent (net of City Center RDA). The Cunent Service Level
(CSL) budget represents the cost of providing the same level of service as in the prior fiscal
year.
BALANGTNG STRATEGIES
At the July 16th Finance and Citywide Projects Committee (FCWPC) m.eeting, the committee
gave direttion to maintain the current tai rate for the preliminary millage, but directed the
administration over the summer to identify opportunities to potentially reduce the millage, as well
as offset increased funding for enhancemenis, as part of the process of balancing the budget'
870
FY 2014115 Proposed Millage Rate
July 23,2014
Page 3
As a result, efficiencies, employee givebacks and potentialservice reductionswillbe considered
in August prior to final budget adoption in September.
As with the preparation of budgets for the last five years, departments are continuing to analyze
and present their budgets fiom two perspectives: 1) a review for potential efficiencies,
reorganizations to redule cost, etc. without impacting services; and 2) performing a modified
zerolbased analysis of each department budget, identifying potential service reduction
alternatives versus core functions. For each of the potential service reductions, departments
provided the type of impact and the magnitude of the impact. Core functions were defined as
ihose functions which, if cut, render it impossible for the department to provide basic service at a
reasonable level. However, based on my review of department budgets to date, and given the
extensive reductions in recent years, I am not expecting to generate significant cost reductions
through efficiencies and service reductions.
ln August, the FCWPC will meet on the 13th and 1Sth to review potential efficiencies, potential
servicL reductions and revenue enhancements, as well as finalize approaches to balance the
budget. The FY 2014t15 budgetwill be adopted in September, 2013 aftertwo budget hearings'
The budget development process is still underway and the City's Proposed_Work Plan and
Budget will be released later this summer. However, at this point in time, the difference between
current service level revenues and expenditures is estimated at $2.45 million. Every million is
equivalent to approximately 0.0454 mills.
BACKGROUND
Overthe last several years, the City of Miami Beach has adopted budgets that provided tax and
fee relief while at the same time providing improved services that address needs and priorities
identified by the community (primarily in public safety, cleanliness, landscaping and
beautification, recreation and cuitural arts programming, renewal and replacement funding for
our facilities, and building/development functions); and providing structural changes that
enhance capital funding and reserves.
However, these objectives became increasingly more challenging in the last seven years: first
through property tax reform where tax rates were dramatically reduced to offset increases in
propJrty'ralues; and subsequently with the decline in property values without revisions to the
property tax rate, as well as increasing pension costs. ln the last seven years, the General Fund
has abiorbed almost $43 million in reductions and reductions of approximately $50 million city-
wide and 271 positions across allfunds.
Further, a total of approximately $20 million in employee "give-backs" were achieved between
FY 2OOgl10 and FY 2011/12, thiough a combination of freezing cost of living adjustments for all
employees for two and one-half years, elimination of merit increases for all employee except
members of the Fraternal Order of Potice (FOP) and lnternational Association of Firefighters)
IAFF, increased contribution to pension for all employees except members of FOP and IAFF,
pension plan changes for the Miami Beach Employees Retirement Plan, increased contributions
ior take-home vehitles by FOP members for 18 months, reduced holiday pay for IAFF members,
and increased contributions to health insurance by members of the FOP and IAFF for 18
months. ln addition, the FY 2012113 budget included an estimated $3.8 million in employee
"give-backs." With the adopted $0.6 million in efficiencies and $4.6 million in employee
g-ivebacks incorporated in the Adopted Work Plan and Budgetfor FY 2013114, the 7 yeartotalof
leductions and employee giveback.s is alCIost $77 million.-
871
FY 2014115 Proposed Millage Rate
July 23,2014
Page 4
Estimated Emplovee Givebacks "
GR,AND TOTAL REDUCTIONS AND
($4.666.0001 ($25,933.360
$ (5,778,0001 (5.s1 2.0 $ (76,814,2961 (276.s',(11.01
* FY 2012113 Budgeted included $3.8 savings for Employee Givebacks, of which onty $919K were achieved
Although the economy appears to have stabilized, the impact of the recent recession impacted
both property tax revenues as well as pension costs through FY 2013114. Therefore, the City's
strategy continues to consider the long term financial sustainability of the City. Beginning with
the development of the FY 2009fi0 budget, a strategy was developed to address short-term,
mid-term and long-term financial needs.
Strategies to address short-term financial needs included ongoing efficiencies and wage
concessions by employees.
Midterm financial sustainability was addressed by pension concessions from current
employees in the Miami Beach Employees Retirement Plan
Longer term financial sustainability is enhanced by the pension plan restructures that
have been put in place for employees in the City's retirement plans. For example, for
General Employees, the plan restructure adopted for new employees is projected bythe
City's actuary to reduce the City's annual required contribution by almost $1 million in FY
2012113, with additional reductions annually as the number of employees in the Miami
Beach Employees Retirement Plan hired after October 1,2010 continues to increase.
Further, additional pension plan reform recommendations were developed by the City's
BudgetAdvisory Committee (BAC)forthe Fire and Police Pension PIan forconsideration
as part of the FY 2013114 adopted budget. While the specific BAC recommendations
were not implemented, the pension reform agreed upon by IAFF and FOP generated
savings is in excess of the BAC recommendations: $5.6 million in the first year and $140
million net present value over 30 years.
GENERAL FUND CURRENT SERVICE LEVEL BUDGET UPDATE
At the strategic planning retreat on June 4,2014, the Commission was briefed regarding the
preliminary General Fund Current Service Level (CSL) budget. The CSL represents the cost of
providing the same level of services as in the prior year and serves as the baseline of funding for
the budget process.
Property taxes comprise 44o/o of the total General Fund revenue and are a key driver of CSL
revenues. The Property Appraiser provided the preliminary 2014 property values on June '1,
General Fund
FY 2013114 Prooosed 7-Year Total
$ lmpacts FT PT $ lmpacts FT PT
Public Safetu ($250,000 (s8.021.09s (68.0 't.0
Cperations (186.000'Q.O ($6,126,867 (66.01 e3.o
Administrative Support (139.0001 (0.5 ($3.186.694 (34.4 1.0
:con & Cultural Dev (42,000 $1.235.426 17.01
SiWide ($1,619.6421
Subtota $ (617.0001 e.5 ($20,189,724 (185.4 (21.0
Transfers (s23.168_S66
Total $ (617,0001 e.s's (43.3s8.690r fi85.4 Q1.0'
lntemal Service Funds (373.000 (1.0 $3.871.225 (38.1
Entemrise Funds fi22.000 e.0 2.0 ($3,651,021 (53.0 10.0
GRAND TOTAL REDUCTIONS $ (1,112,000 (5.51 2.0 $ (s0.880.9361 (276.5'(11.01
872
FY 2014115 Proposed Millage Rate
July 23,2014
Page 5
2014. The preliminary 2014 property values increased 9.Ao/o,which resulted in an increase of
$11 million in General Fund property tax revenues.
CSL revenues were estimated to increase $12.7 million due to an $11 million increase in
property tax revenues (assumed keeping the millage rate the same), a $2.5 million increase in
buifOind permit revenue, a $1 million increase in electric utility and franchise taxes, and a
decreale in prior-year set-aside (one-time revenue) of $1.8 million. The Resort Tax contribution
and Parking fund surplus contribution were assumed to be flat.
CSL expenditures were estimated to increase $10.7 million due to salary increase trom a 3o/o
cost of iiving adjustment (COLA) and O-2o/o merit pay, the impact of annualized costs for items
added during FY 2013/14, the impact of CSL department requests, and savings in net lower
pension con[ributions due to savings in Fire and Police form last year's pension reform offset by
a slight increase in MBERP pension contribution.
The preliminary CSL presented atthe June 4th strategic planning retreattotaled a net surplus of
$2.0 million
Since that time, the CSL has been updated with the fiscal impact of two items. On July 1't the
Property Appraiser provided the certified taxable values for 2014 which are the official numbers
used for the budget process. The certified taxable values increased 10.3o/o, net of the City
Center Redevelofment Area, which was higher than the preliminary taxable value of 9.4%' This
difference results in an additional $650,000 of property tax revenue.
On the expenditure side, additionalwindstorm insurance coverage of $335,000 was added to
the FY 2013t14 budget in the Risk Management fund at the June 11th Commission meeting.
The Risk Management fund is an internal service fund that charges out all of its costs to other
departments in various funds. The General Fund comprises approximately 60% of the Risk
charges so the impact to the General Fund for the FY 2014115 CSL is $201,000.
The net result to the preliminary CSL surplus of $2.0 million given $650,000 of additional
property tax revenue and $201 ,000 of additional windstorm coverage expenditure is an updated
CSL surplus of $2.45 million.
,CSL Revenues
,CSL Expenditures
S 7'-2:7, million
10.7 i million
Net Su rpl us/(Shortfa ll)2.O I million
"l l"-l i.nl -l!r,v"-p-s!-s g-rp- l
-u
s . . -
Additional Property Tax Revenue
:AdditionalWindstorm Coverage Expense i (0.2)' million
, Net Surplus/(Shortfall)S 2.45 : million
873
FY 2014115 Proposed Millage Rate
July 23,2014
Page 6
DECISION.MAKING PROCESS
Development of the FY 2014115 budget began early in the calendar year with budget staff and
departments working together to prepare their current service level budgets. On June 4, 2014,
the Commission held a retreat to review the community survey results, updated environmental
scan, and prioritize initiatives in the strategic plan. On July 18h the Finance & City-wide Projects
Committee (FCWPC) reviewed the Current Service Level budget, which reflects budget
increases ordecreases necessaryto provide the same levelof services in the coming yearand
the proposed Capital lmprovement Program, which details allof the City's capital projects over
the next five years. ln August, the FCWPC will meet on the 13th and 15th to review potential
efficiencies, potential service reductions and revenue enhancements, as well as finalize
approaches to balance the budget. The FY 2014115 Proposed Work Plan and Budget will
continue our focus on providing "value of services for tax dollars paid" and will be adopted in
September,2014, after two budget hearings on September 1Oth and September 30th.
STATUTORY REQUIREMENTS
FS 200.065, entitled "Method of Fixing Millage" establishes specific guidelines that must be used
by all local government entities in setting millage (property tax) rates. Under the statute, the City
is required, within 35 days of receipt of the "Certification of Taxable Value" (received July 1,
2014), to advise the Miami-Dade County PropertyAppraiserof the proposed generaloperating
millage rate, the calculated "rolled-back" rate and the date, time, and place of the first public
hearing to consider the proposed millage rates and tentative budgets for FY 2014115. The
required Debt Service millage rate must also be set at the same time as the general operating
millage.
After setting the proposed operating millage rate, the Commission may, at any time prior to the
final adoption, lowerthe rates by adjusting priorities. However, increasing the millage rate may
only be accomplished by an expensive mailing and advertising process to every property owner
on Miami Beach. The City's proposed operating millage rate as well as that of other taxing
authorities will be included in the Truth-in-Millage (TRIM) statementsentto each propertyowner
in the City.
ANALYSIS OF PROPERTY VALUES IN MIAMI BEAGH
On July 1,2014, the City received the"2014 Certification of Taxable Value" from the Property
Appraiser's Office stating that the taxable value for the City of Miami Beach is $27.1 billion
including $152.2 million in new construction. The preliminary 2O14value represents an increase
of $2.4 billion or 9.9 percent more than the July 1 ,2013, Certification of Taxable Value of $24.6
billion and an increase of 9.3 percent, excluding new construction.
The comparative assessed values for the Miami Beach Redevelopment Agency City Center
redevelopment district increased from $3.9 billion to $4.2 billion an increase of $315 million or a
8.1 percent increase over 2013 certified values. ln addition, assessed values within the
geographic area formerly known as the South Pointe redevelopment district increased from $3.9
billion to $4.3 billion an increase of $413 million, ora 10.5 percent increase in values over2013
certified values. As a result, taxable values in the areas outside the City Center RDA/South
Pointe area increased by 10.2 percent, from $16.9 billion to $18.6 billion, an increase of $1 .7
-millio
874
FY 2014115 Proposed Millage Rate
July 23,2014
PageT
Cihywide values excluding City Center increased from $20.8 billion to $22.9 billion, an increase
of $Z.t billion or 10.3 peiceni. Values outside the City Center area determine General Fund
revenues.
COMPARATIVE ASSESSED VALUES
Jon. 1 2013 Volue (in billions)
% Chq.
Jon. 1,20.l4
Volue (in
billionsl
Chonge from 2013
Volue lBudoetl
As of July 1
201 3
(For FY
2013/14
Budget)
Revised
Volue (For
FY
2013/14
Proiectionl
Chonge in
20r 3
Volues
As of July I
201 3
(For 2014/15
Budqet)
$
lin billionsl %Chs
IDA - Ciry Ctr $ 3.8714 $ 3.6341 $ (0.2373)4.1%$ 4.1867 $ 0.315:8.1"1
louth Pointe 3.9148 3.7692 t0.1456 -3.77,4.327!$ o.412i 10.5"1
3enerol Fund exc
i.Pte
16.820:16.2354 (0.6349 -3_8"/,18.5942 $ 1.7239 102%
lotol Citywide $ 24.6s65 $ 23.6387 (r.0r78)-4.1%$ 27.108/$ 2.4519 9.901.
Citnvide Net ot
Sitv Center $ 20.785 r $ 20.0046 $ (0.7805)-3.8%$ 22.9217 $ 2.1 36(t0.3%
VALUE OF ONE MILL OF TAXABLE VALUE
The first building btock in developing a municipal budget is the establishment of the value of one
mill of taxation]wherein tne mill iJ defined as $1.00 of ad valorem tax for each $1,000 of
property value. For the City of Miami Beach, the value for each mill is determined by the 2014
Certification of Taxable Vilue and has been set at $27.1 million. Florida Statutes permit a
discount of up to five percent for early payment discounts, delinquencies, etc. Therefore, the 95
percent value of the mill is $25-7 million. Net of Center City RDA tax increment available to the
beneral Fund, the value of one mill at 95 percent is $22.0 million.
MA(IM UM MILLAGE DETERMINATION
For FY 2014115, the proposed operating millage rateforgeneralCityoperationsis 9.86?4' same
as in Fy20 13ti4. Based on the July 1 ,-2014,-Cerlification of Taxable Value, 5.8634 mills would
generate approximately $t 50,975,0-00 in general tax revenues, an increase of $13,632,000 over
FY 2013/14'budgeted property tax revenuLs Citywide (General Fund, City Center RDA and the
South Pointe area).
Further, the January 1,2013, tax roll Cityrvide declined by $1 .0 billion between the July 1,2013
valuation and the .tuty t ,2014 valuation due to appeals, adjustments, etc', which is part of the
reason that the Fy 2014t15 "rolled-back rate" is significantly less than the FY 2013/14 current
millage rate. The area outside of City Center RDA declined by almost $0.8 billion.
Further, pursuant to recently enacted State legislation, the City may elect to approve millage
rates above the roll-back raie-up1o the constiiutional cap of 10 mills subject to-the following-
875
FY 2014115 Proposed Millage Rate
July 23,2014
Page 8
votes by the Commission or referendum:
. Option l: A majority of the approval of the Commission Millage is required to approve a
millage up to 7 .2121 (equivalent to 3.15 percent increase in property tax revenues). The
3.15 percent increase is the state per capita personal income gain for the prior calendar
year.. Option ll: A twothirds approval (5 of 7 votes) of the Commission is required to approve a
millage up to 7.9333 (equivalent to a 10% increase in the ad valorem revenues above
Option l).. Option lll: A unanimous approval of the Commission or referendum is required to approve a
millage above 7.9333 up to the 10 mill cap
The proposed operating millage rate of 5.8634 therefore requires a majority approval (4 of 7
votes) of the Commission.
DETERMINING THE VOTED DEBT SERVICE MTLLAGE LEVY
The general obligation debt service payment for FY 2014115 is approximately $5.9 million.
Based on the July 1 ,2014 Certified Taxable Value from the Property Appraiser, these bonds
would require the levy of a voted debt service millage of 0.2295 mills. This represents a
decrease of 0.0234 mills.
COMBINING THE OPERATING AND VOTED DEBT SERVIGE MILLAGE LEVTES
lllustrated below is a comparison of the combined millage rates and ad valorem revenues to the
City of Miami Beach for FY 2013114 and FY 2014115 (preliminary) including RDA. lt is
recommended that in the GeneralFund, 0.1083 mills of the totaloperating millage continue to
be dedicated to renewaland replacement, resulting in approximately 92.18 million in renewal
and replacement funding.
%lncl(Dec)
City of Miami Beach Millage Rates
Operating
Capital Renewal & Replacement
Sub-total Operating M illage
Debt Service
Total
FY 06/07
71920
0.1820
FY 13t14
5.7551
0.1083
lnc/(Dec)
0.0000
0.0000
From hrom
FY13t14 FY 06/07
7.3740
0.2990
5.8634
0.2529
i 0.0000
: -0.0234
0.0o/o -20.5%
-9.3o/o -23.20/.
7.673C 6.1163 -0.0234 -0.4o/o -20.60/o
lf these recommended millage rates are tentatively adopted, then the City of Miami Beach's total
operating millage will remain the same as the current year, and the voted debt service millage
will decrease by 0.0234 mills.
876
FY 2014115 Proposed Millage Rate
July 23,2014
Page 9
Homesteaded Properties
Amendment 10 to the State Constitution took effect on January 1, 1995 and limited the increase
in assessed value of homesteaded property to the percentage increase in the consumer price
index (CPl) or three percent (3%), whichever is less. For 2O14,the CPI has been determined to
be 1 .S'percent and therefore, the increase is capped at1 .5% for increased values as of January
1,2014.
Overall, based on the homesteaded properties in the January 1,2013 homestead values as of
July 1, 2013 valuation, the median vaiue of homesteaded property in Miami Beach for2013 was
$tgZ,Sll, and the average $317,086. Applying the increase to the market value of all existing
homesteaded propertieslrom the 2013 tax roll, and the 1.5 percent CPI adjustment, the impact
of the millage iate adjustment to homesteaded properties would be as shown in the following
table.
Homesteaded ProPerties
FY 2013114
FY zOL4lLs
with 1.5% CPI
Median I Average Median Average
2013 Preliminary Taxable Value $ 132,371 $ 317,086 $ 134,3s7 $ 321,842
City of Miami Beach
Operating
Voted Debt
Total Miami Beach
$776
33
$ 1,8se
73
$ 788
31
$ 1,887
74
$ 809 $ 1,932 $ 819 $ 1,961
$ Ghange in Taxes
Operating
Voted Debt
Total Miami Beach
$ i2$
(21
28
1
$10$ 29
*Source:Miami-DadeCountyPropertyAppraiser's-2013.average.me@
Non-Homesteaded ProPerties
The annual increase in market value of a non-homestead propefty is capped at 10 percent
(does not apply to school millages). The city-wide average increase in property values is 9.9
percent. The property value of individual properties may increase more or less than 9.9 percent,
but not more than 10 Percent.
H istorical Perspective
It is important to remember that in prior years, the City of Miami Beach significantly reduced tax
rates as property vatues increased. Between FY 1999/00 and FY 2009110, property tax rates
declined'approiimately 2.8 mills. ln FY 2OOTtOB alone, the property tax rate declined by
approximaiely 1.8 mills, with annual savings to the average homesteaded propertyof over$400.
ln addition, in fY 2005/06 and FY 2OOOIO7, the City funded $200 and $300 homeowner
dividends paid to homesteaded property owners in the City'
877
FY 2014115 Proposed Millage Rate
July 23,2014
Page 10
Property Volue, Milloge ond Property Tox L"ry
Toxoble Volues
Chort
Toxoble Properiy
Volues (billions)
Finol,/Revised
Toxoble
Volues
(billions)
Millocre Rotes Tox Levy (in millions)
Totol Combined
Cih,ruride
Milloqe
Gnerol
FundlRDA
Millooe
Totol Tox Levy
includinq Debt
Generol Fund
Totol
(including S.
Pointe, ond
Renewol &
Reolocemenl)
tY1997/98 $ 6.46 $ 6.40 9.21@ 7.4990 $ s7.45 s 46.78
FY199B/99 $6.97 $ 687 8.9830 7.4990 $ 60.32 $ 44.66
FY1999/oo $7.66 s 754 8 6980 7.4990 $ 64.29 s 47.36
FY2WO/O1 $ 8.37 s 822 8.5550 7.3990 $ 69.08 s 497s
FY2@1/O2 $9.40 $ 9.22 8.3760 7.2990 $ 7s.97 $ 54.37
FY2Cc2/03 (0.56 $o.41 8.3220 7.2990 $ 84 Br $ 61.0s
FY2@3/O4 $2.O9 $r .85 8.1730 7.2990 $ 95.39 $ 68.17
FY2@4/05 $4.O4 $3.86 8.1730 7.4250 $10 74 $ 79.38
FY2Cc,5/06 $7.45 $7.15 8.0730 7.4810 $35 91 $1.69
FY2@6/O7 $ 22.74 $ 22.26 7.6730 7.3740 $68.38 $40.31
FY2@7/O8 $ 26.85 $ 26.14 5.8970 5 6555 $50.42 $25.33
rY2Cr8/O9 $ zo.so $ 2s89 5.8930 5.6555 $50.59 $25.94
FY2@9/o $ 2470 $ zs.zt 5.9123 5.6555 $38.7A $5.73
FY2010/$ 22.10 $ 20.97 6 5025 6.2155 $36.55 $2.14
FY201t /2 $ 2r.98 $ 2o.7s 6 4539 6. r 655 $34.75 $1.29
FY20t2/3 $ 23.07 $ 22.02 6.3477 6.0909 $39.1 0 $4.32
rY2013/4 $ 24.66 $ 23.64 6.1 1 63 s.8634 $43.26 $7.41
FY2014/5 $ 27.10 6.0929 5.8634 $56.89 $29.29
Further, although the City increased the operating tax rate by 0.56 mills in FY 2010/1 1 , the City
has decreased the millage by 0.3521 mills in the last three years and the combined millage rate
overall remains approximately 2.6 mills lower ot 30o/o, than it was in FY 1999/00.
TOTAL COMBINED MILLAGE
10.oooo
9.@OO
a-g)oo
7-OOOOq(uid 6.0000G
<1, 5.oo@qo(!
= 4-oooo
=3-O@O
2.@OO
1.moo
0_oooo
,ffi,
ffi
ffi
.w
L504 {)5 06 07 0a 09 Lo tt- a2 L3
Fiscal Years
9a 99 00 01 02 (}3
878
FY 2014115 Proposed Millage Rate
July 23,2014
Page 11
FIRST PUBLIC HEARING
The first public hearing on the proposed millage rates and tentative budgets for FY 2014115
must be held no later tian 80 days or earlier than 65 days from the start of the TRIM ("Truth ln
Millage"; calendar (July 1st). Other guidelines are: 1) the public hearing cannot be_ scheduled on
a SuiOiy or on those days utilized by Miami-Dade County or the Miami-Dade County School
Board foi tneir public hearings; and 2) if on a day other than Saturday, the public hearing must
be after 5:00 P.M.
Based on these guidelines, the first hearing must be held between September 3rd and
September 18th. These dates are unavailable for the following reasons:
September 7 and 14
September 4 and 18
September 3
Of the remaining days, it is recommended that the first public hearing be set for Wednesday'
September 10,-2Otq, at 5:01 P.M., in the City Commission Chambers, City Hall, and 1700
Convention Center Drive, Miami Beach, Florida.
JLM/J W
@
Sundays
Proposed dates for Miami-Dade County Public Hearings
Miami-Dade County School Board Public Hearing
879
RESOLUTION NO.
A RESOLUTION OF THE MAYOR AND CITY COMMISSION
OF THE CITY OF MIAMI BEACH, FLORIDA, SETTING THE
PROPOSED MILLAGE RATES FOR FISCAL YEAR (FY)
2014115, THE CALCULATED ,.ROLLED.BACK'' RATE, AND
THE DATE, TIME, AND PLACE OF THE FIRST PUBLIC
HEARING; FURTHER AUTHORIZING THE CITY MANAGER
TO TRANSMIT THIS INFORMATION TO THE MIAMI.DADE
COUNTY PROPERW APPRAISER !N THE FORM
REQUIRED BY SECTION 200.065, FLORIDA STATUTES
WHEREAS, Section 200.065, Florida Statutes, has specified the method bywhich
municipalities may fix the millage rate and adopt an annual budget; and
WHEREAS, development of the FY 2014/15 budget began early in the yearand has
included discussions with the Commission that included a review of priorities, economic
projections and their impacts on the budget, preliminary projected revenues and
expenditures; and
WHEREAS, over the last several years, the City of Miami Beach has adopted
budgets that provided tax and fee relief while at the same time providing improved services
that address needs and priorities identified by the community and providing structural
changes that enhanced capital funding and reserve; and
WHEREAS, maintaining and enhancing the City's priorities have become
increasingly more challenging in the last seven years: first through property tax reform
where tax rates were dramatically reduced; and subsequently with the decline in property
as well as increasing pension costs; and
WHEREAS, the July 1 ,2014, Certification of Taxable Value from the Miami-Dade
County Property Appraiser reflects a 9.9 percent increase in Cityrruide property tax values
from the July 1 , 2013, tax roll certification, a 8.1 percent increase in the City Center
Redevelopment Area (RDA), and a 10.3 percent increase in values outside the City Center
RDA, which impacts the City's General Fund revenues; and
WHEREAS, in the last seven years, the General Fund has absorbed $43 million in
reductions (and more than $50 million cityruide and 276 positions across all funds) in a
General Fund budget that is $264.1million in FY 2013114, which is only 11o/omorethan the
FY 2006/07 budget, despite pension contribution increases of $29 million over the same
period; and
WHEREAS, a total of approximately $26 million in employee "give-backs" were
achieved between FY 2OOgl10 and FY 2013114,which, along with more than $50 million in
efficiencies and reductions, represents more than $76.8 million in combined "givebacks"
and reductions over 7 years; and
880
WHEREAS, between FY 1999/00 and FY 20llll2,thetotalcombined Cityof Miami
Beach property tax rates declined approximately 2.24 mills and in FY 2007108 alone, the
property tax rate declined by approximately 1.8 mills, with annual savings to the average
homesteaded property of over $400, in addition to City funded $200 and $300 homeowner
dividends paid to homesteaded property owners in the City in FY 2005/06 and FY 2006107;
and
WHEREAS, at the July 16th, 2014, Finance and Cityruide Projects (FCWPC)
meeting the consensus was to set the proposed operating millage in July at the rate of the
millage rate of 6.0929, which is 0.0234 less than the FY 2013114 rate; and
WHEREAS, the City of Miami Beach is required to advise the Miami-Dade County
Property Appraiser of the Proposed Millage Rates, the "Rolled-Back" Rate, and the date,
time, and place of the first public hearing; and
WHEREAS, the January 1,2013, tax roll declined by $1 .0 billion between the July
1,2013, valuation and the July 1,2014, valuation due to appeals, adjustments, etc. , which
is part of the reason the FY 2014115 "rolled-back rate" is 0.7558 mills lower than the FY
2013114 current millage rate; and
NOW THEREFORE, BE IT DULY RESOLVED BY THE MAYOR AND THE CITY
COMMISSION OF THE CITY OF MIAMI BEACH, FLORIDA, that the following
recommendations of the Administration be and are hereby ratified for transmittal to the
Miami-Dade County Property Appraiser, as specified in Section 200.065, Florida Statutes:
1) Proposed Millage Rates for FY 2014115
General Operating 5.7551 mills
Capital Renewal & Replacement 0.1083 mills
Total Operating Millage 5.8634 mills
Debt Service
Total Combined Millage
2) "Rolled-Back" Rate
0.2295 mills
6.0929 mills
5.1076 mills
3) The first public hearing on the proposed millage rate and the tentative budget for FY
2014115 shall be held on Wednesday, September 10,2014 at 5:01 P.M., in the City
Commission Chambers, City Hall, 1700 Convention Center Drive, Miami Beach,
Florida.
881
PASSED and ADOPTED, this 23'd day of July,20'14.
ATTEST:
RAPHAEL E. GRANADO, CITY CLERK
MAYOR PHILIP LEVINE
882
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883