R7F-Set Proposed Millage Rates For Fiscal Year 2014-15COMMISSION ITEM SUMMARY
lntended Outcome S
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 MTE; 3) THE
TED'ROLLED-BACK'MTE;AND,4) THE DATE, TIME, AND PLACE OF THE FIRST PUBLIC HEARING
CONSIDER THE MILLAGE RATES AND BUDGETS FOR FISCAL YEAR (FY) 2014115; FURTHER
THE CIry MANAGER TO TMNSMIT THIS INFORMATION TO THE MIAMI-DADE COUNry
APPRAISER IN THE FORM REQUIRED BY SECTION 200.065, FLORIDA STATUTES
Ensure expenditure trends are sustainable over the long term
pporting 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%)
Item 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), to 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 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, 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 24h by the Property Appraiser.
The total proposed operating millage rate for FY 2014115 is 6.0929 mills, which represents a slight decrease ftom
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 intemal service fund charge-backs.
Fi nancial I nformation :
iource of Funds:Amount Account
I (q)l
OB.H
1
total
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 property tax revenues in the General Fund of $14.3 million.
(B MIAMIBEACH 868
g MIAMIBEACH
Ci?y of Miomi Beoch, 1700 Convention Center Drive, Miomi Beoch, Florido 33,l39, www.miomibeochfl.gov
COMMISSION MEMORANDUM
Mayor Philip Levine and Members the City mtsston
Jimmy L. Morales, City Manager
July 23,2014
A RESOLUTION OF THE MA
TO:
FROM:
DATE:
SUBJECT:
1) Proposed Millage Rates for Fy 2O14t1S:
General Operating
Capital Renewal & Replacement
Sub-Total Operating Millage
Voted Debt Service
Total
MIAMI BEACH, FLORIDA
AND CITY COMMISSION OF THE CITY OF
1) THE PROPOSED OPERATTNG MTLLAGE
RATE; 2) THE REQUIRED DEBT SERVICE MILLAGE RATE; 3) THE CALcULATED
"RoLLED-BACK" RATE; AND,4) THE DATE, TIME, AND pLAcE oF THE FTRST
PUBLIC HEARING TO GONSIDER THE MILLAGE RATES AND BUDGETS FOR
FISCAL YEAR (FY) 2014t15; FURTHER AUTHORTZ|NG THE ClTy MANAGER TO
TRANSMIT THIS INFORMATION TO THE MTAMI.DADE COUNTY PROPERTY
APPRAISER 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 to transmit the following information to the Miami-Dade County Property Appraiser:
5.7551 mills
0.1083 mills
5.8634 mills (same as last year)
0.2295 mills (0.0234 decrease from last year)
6.0929 mills (0.0234 decrease from last year)
2) "Rolled-Back" Rate (Truth in Millage) S.1076 mills
3) The first public hearing to considerthe proposed millage rates and tentative budgets for Fy
2014115 shall beW_ed199dgy, September 10, 2014 ;t 5:01 p.m., in the City Commissionchambers, city Hall, 1700 convention center Drive, Miami Beach, Florida.
The "Rolled-Back" millage rate for FY 2014115 is the millage rate required to produce the same
lev_el9f property tax revenues in the General Fund in FY i}14t15 as anticipaied to be receivedin FY 2013114. lt is important to note, that the January 1,2013, tax roll Citywide declined byalmost $1'02 billion (4.1o/o) between the July 1, 2013 vlluation and the July 1 ,2}l4valuation
lue to appeals, adjustments, etc, which is part of the reason the FY ZO14l1-S "roll-back rate', is0.7558 mills lowerthan the FY 2013/14 current millage rate and lowerthan itwould 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 revenues, declined invalue by approximately 90.24 billion during the same period of time.
869
FY 2014115 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 Adjustmen!_(ColA); a 2 percent
p"rrorii1"'n.e-based merit increasei additional steps for Police officer, Police sergeant, Police
Lieutenant, Firefightei I positions as well as implementation of hazardous duty pay; higher health
care costs; the impact oi annualized costs for items added during FY 2013/14; higher operating
costs; and internal service fund charge-backs.
SUMMARY
ln Fy 2O1Ol11 the city's approach to addressing the then deficit of $32 million included a
distribution of the shortfall between taxpay'ers 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- y.a]ue? increase over time' lt should be
remembered that between Fy 2009/10 and FY 2 oiotll values declined by $2.0 billion driving
the need for an increase in the millage.
ln Fy 2O11t12the city took its first step in that direction with a reduction in the millage rate of
0.0s mius. The mit6ge rate for FY zotztt3 reduced the operating Ti!!?99 by an additional
0.0746mills. lnthe r)zol3/l4budget,themillageratewasreduced0.22TSmills. overthree
y"rrr, this reduction represents 63 fercent 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 slight iecrease of 0.0234 mills. The total proposed operating
mittagehas been'keptflatand initudes a generaloperatin-g millage rate of 5.755.1 and a General
Funjcapital Renewal and Replacemenimillage of 0.1083. The proposed voted debt service
*irr"g" rate is adjusted from o.z5z9 to 0.2295, a decrease of 0.0234mills.
It is important to remember that in prior years,1|l9 C-iY-of lr/iami Beach significantly reduced tax
rates as property values increased'. BeWveen FY 1999/OO and FY 2009110, total combined City
of Miami'ae'acn-prop"rty t"* rates declined approximately 2.8 mills. ln FY 2007/08 alone, the
,iil"g" rate declined 'by approximately 1.8 mills, with annual savings to the average
homesteadeO property o? oudr $400. Further, despite an adjustment of 0..56 mills in the
operating tax rate in rV zot 0/1 1, City of Miami Beach proposed combined millage rates today
remain more than 2.6os1mills loweithan in FY 1999/00 (30 percent), and 1.5801 mills lower
than 2006/07 (20.6%).
The budget development process is still underway, and the city's Proposed work Plan and
Audget,,iil O" released later this summer. However, at this point in time,.the s.urplus between
current 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.
BALANCING STRATEGIES
At the July 16th Finance and Citywide Projects C-ommittee (FCWPC) m.eeting, the committee
gave direction 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 potential service reductions will be 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 anallae
and present their budgets from two perspectives: 1) a review for potential efficiencies,
reorganizations to reduce cost, etc. without impacting services; and2) performing a modified
zero-based anatysis 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 forthe departmentto provide basic service ata
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
service reductions and revenue enhancements, as well as flnalize approaches to balance the
budget. The FY 2014t15 budget will be adopted in September, 2013 after two budget hearings'
The budget development process is still undenruay 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 estlmated 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 culturat 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
prope-rty'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 2009/1 0 and FY 2011/12, through 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 Police (FOP) and lnternational Association of Firefighters)
IAFF, increased contribution to pension for all employees except members of FOP and IAFF,
pension plan changes forthe Miami Beach Employees Retirement Plan, increased contributions
iortake-home vehides by FOP membersfor 18 months, reduced holidaypayfor 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
givebacks incorporated in the Adopted Work Plan and Budgetfor FY 2013114,the 7 yeartotal of
1ed uctions a nd e mp|oyee g ive ba.oks ts-et I mo*.-t $I I m i t t i o n
871
FY 2014115 Proposed Millage Rate
July 23,2014
Page 4
Estimated Emolovee Givebacks *
GRAND TOTAL REDUCTIONS AND GIVEBACKS
($4.666.0001 ($25.933.360)l -
$ (s,778,0001 (5.5 2.0 $ o6.814.296t1 e76.5 fi1.0
* FY 2012113 Budgeted included $3.8 savings for Employee Givebacks, of which only 9918K 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 FY2013114. Therefore, the City's
strategy continues to consider the long term financial sustainability of the City. Beginning with
the development of the FY 2009/10 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.
Mid-term 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
Budget Advisory Commiftee (BAC) for the Fire and Police Pension Plan for consideration
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 firstyearand $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 PlopertyAppraiser provided the preliminary 2014 property values on June 1,
General Fund
FY 2013114 Proposed 7-Year Total
$ lmpacts FT PT $ lmpacts FT PT
Public Safetu ($250.000 ($8,021,0951 (68.0 1.0
Operations (186.000 (2.0'($6.126.867 (66.0 Q3.O'
Administrative Suooort (139,000 (0.5 ($3.186.694 {.34.4 1.0
Econ & Cultural Dev u2.000 ($'t.235.426 n7.o'
Citywide ($1.6'19.642
Subtota $ (617,000 (2.5 $20.189.724 fi85.4 e1.0'
fransfers ($23.168.966
Tota $ (617,000t (2.5)$ (43.358.690 (18s.41 Q1.0)
lntemal Service Funds (373.0001 (1.01 ($3.871.225 (38.1
Enterprise Funds fi22.OOO (2.0 2.0 ($3.651.021 (53.01 10.0
GRAND TOTAL REDUCTIONS $ (1.112.0001 (s.5 2.0 $ (50,880,9361 (276.51 (11.0
872
FY 2014115 Proposed Millage Rate
July 23,2014
Page 5
2014. The preliminary 2AM property values increased 9.4o/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
buifOinj permit revenue, a $1 million increase in electric utility and franchise taxes, and a
decrea-se 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 from a 3%
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 lastyear's pension reform offset by
a slight increase in MBERP pension contribution.
The preliminary CSL presented at the June 4th strategic planning retreat totaled 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 tne OuOget process. The certified taxable values increased 10.3o/o, net of the City
Center Redevelo[ment 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 2013114 budget in the Risk Management fund at the June 11tn 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 mitlion given $650,000 of additional
propertytax revenue and $201,000 of additionalwindstorm coverage expenditure is an updated
CSL surplus of $2.45 million.
FY zotfilts CSt UPDATE
- ---: - - '----
2.O ' million
Additional Property Tax Revgnye
i---..
:AdditionalWindstorm Coverage Expense ' lO.2): million
!t:l
It- .
-j "s
l
1
".-.-... .. .. .. ... . -."1* '=- - .'..--.*t1:
'CSLRevenues iS L2], millio-ni
; 10.7 million
;Net Surplus/(Shortfall) I S 2.o million l
; Net Surplus/(Shortfall)S 2.45 : million L
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 togetherto 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 18th the Finance & City-wide Projects
Committee (FCWPC) reviewed the Cunent 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 all of the City's capital projects over
the next five years. ln August, the FCWPC will meet on the 13th and 1sth to review potential
efficiencies, potential service reductions and revenue enhancements, as well as finalize
approaches to balance the budget. The FY 2A14n5 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, aftertwo 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 general operating
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, lower the rates by adjusting priorities. However, increasing the millage rate may
only be accomplished byan expensive mailing and advertising process to every propertyowner
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 properlyowner
in the City.
ANALYSIS OF PROPERTY VALUES IN MIAMI BEACH
On July 1,2A14, 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 2O14vatue represents an increase
of $2.4 billionor9.gpercentmorethantheJuly 1,2013,Certificationof TaxableVatue ot$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 ora
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, or a 10.5 percent increase in values over 2013
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
million.
874
FY 2014115 Proposed Millage Rate
July 23,2014
PageT
Citywide vatues excluding City Center increased from $20.8 billion to $22.9 billion, an increase
of $z.t billion or 10.3 p"i""ni. Values outside the City Center area determine General Fund
revenues.
COMPARATIVE ASSESSED VALUES
Jon. I 20 13 Volue (in billions)
%Cho
Jon. I, 201r'
Volue (in
billionsl
Chonge from 2013
Volue [Budset]
As of July I
20r 3
(For FY
2013/14
Budqetl
Revised
Volue (For
FY
2013/14
Proiectionl
Chonge in
2013
Volues
As of .luly I
201 3
lFor 2014/15
Budqet)
$
(in billions)%Cho
IDA - City Ctr $ s.ezt z $ g.osai $ (0.237s 4.1"1 $ 4.1867 $ 0.315:8.1%
louth Pointe 3.9 r 48 3.769't0.1456 -3.77,4.327:$ 0.4127 10.5%
3enerol Fund excl
S.Pie
16.8703 16.2354 (0.634e)-3.8"1 18.594i $ 1.7239 10.2%
Totol Citywide 5 24.656s $ 23.6387 (r.0r78)4.1"/,$ 27.1084 $ z.asts 9.9y"
Citnvide Net ol
Citv Center $ 20.7851 $ 20.004($ (0.7805)-3.8"/,$ 22.9217 $ 2.1 366 r 0.3%
VALUE OF ONE MILL OF TA)(ABLE VALUE
The first building block in developing a municipal budget is the establishment of the value of one
mill of taxation]wherein tne miil iJ defined as $1.0b 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 rrtri of the mill is $25.7 milfion.- 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 rate forgeneral Cityoperationsis 9..8691'same
as in Fy 20 13t14. Based on the July 1 lZOl+,bertification of Taxable Value, 5.8634 mills would
generate approximately $1 50,975,0-OO in general tax revenues, an increase of $13,632,000 over
Fy 2013/14'budgeted property tax revenGs Citywide (General Fund, City Center RDA and the
South Pointe area).
Further, the January 1,2013, tax roll Citywide declined by $1.0 billion between the July 1,2013
valuation and the llty t ,2014 valuation due to appeals, adjustments, etc., which is part of the
reason that the Fy do14t15 "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-bact< r:aie up-to the constiiutional cap of 10 mills subject to-thejollowing-
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 t.ax revenues). The
3.15 percent increase is the state per capita personal income gain ior the prior caiendar
year.. Option ll: A two-thirds 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 Z
votes) of the Commission.
DETERMINING THE VOTED DEBT SERVICE MILLAGE LEVY
The general obligation debt service payment for FY 2014t15 is approximately $5.9 million.
Based on the July 1 , 2014 Certified Taxable Value from the Property Appraisei, these bonds
would require the levy of a voted debt service millage of 0.2295 mills. This represents a
decrease of 0.0234 mills.
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 2014t15 (preliminary) inctuding RDA. tt is
recommended that in the General Fund, 0.1083 mills of the totaloperating millage continue to
be dedicated to renewal and replacement, resurting in approximately 92.ig million in renewal
and replacement funding.
%lnclDecl
City of Miami Beach Millage Rates
Operating
Capital Renewal & Replacement
Sub-total Operating Millage
Debt Service
Total
FY 06/07
7192C
0.182C
FY 13114
5.755'1
0.1083
lnc/(Dec)
0.000c
0.000c
F rom romF
FY13l14 FY 06/07
7.3740
0.299C
5.8634
0.2529
0.0000
-0.o2u
0.0% -20.50/o
-9.3o/o -23.2o/o
7.6730 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.So/ofor increased values as of January
1,2014.
Overall, based on the homesteaded properties in the January 1,2013 homestea.d values as of
July 1 , iOlgvaluation, the median vaiue'of homesteaded property in Miami Beach for 2013 was
$l5Z,gl t, and the average $31 7,086. 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 2OL4IL5
with 1.5% CPI
Median Average Median Average
2013 Preliminary Taxable Value $ 132,371 $ 317,086 $ 134,357 $ 321,842
City of Miami Beach
Operating
Voted Debt
Total Miami Beach
$776
33
$ 1,859
73
$ 788
31
$ 1,887
74
E eos $ 1,932 $ 819 $ 1,961
g Change in Taxes
Operating
Voted Debt
Total Miami Beach
$12 $ 28
(21 1
$10$ 29
* Source: Miami-Dade County Property Appraiser's - ZOt a-","',g9-'"ditn-ho'"ttt'
Non-Homesteaded ProPefties
The annual increase in market value of a non-homestead property is capped at 10 percent
(does not apply to school millages). The city-wide average increase in property values is 9.9
percent. The pioperty value of irdividual 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. Betr,veen FY 1999/00 and FY 2009110, property tax rates
declined'approiimately 2.8 mills. ln FY 2Oo7lO8 alone, the property tax rate declined by
approximaiely 1.8 mills, with annual savings to the av_e.rag9 homesteaded properlyof over$400.
ln addition, in FY 2005/OO and FY aOOO1O7, 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 Properfy Tox Levy
Toxoble Volues
Chort
Toxoble Property
Volues {btllionsl
Finol,/Revised
Toxoble
Volues
(billions)
Millooe Rotes Tox Lew {in millions}
Totol Combined
Cihyraride
Millooe
Gnerol
Fund/RDA
Millooe
Totol Tox Levy
includinq Debt
Generol Fund
Totol
{including S.
Pointe, ond
Renewol &
Replocemenl)
tY1997 /98 $6.46 $ 6.40 9.2 r 00 7.4990 $ 57.45 $ 46.78
tY1998/99 $6.97 s 6.87 8.9830 7.4990 $ oo.rz s 44.66
FY1999/OO $7.66 $ 7.54 8.6980 7.4990 $ oq.zs s 4736
FYZWO/O1 $o.J/$ 8.22 8.5550 7.3990 $ 69.08 $ 49.75
FY2W1/02 $9.40 $ 9.22 8.3760 7.2990 $ zs.sz $ 5437
FY2@2/Os $ to.s6 $o.41 8.3220 7.2990 $ 84 BI $ 6r.05
FY2W3/O4 $ 12.09 $1.85 8.1730 7.2990 $ 9s39 $ 68. 17
FY2W4/Os $ 14.04 $J.UO 8.1730 7.4250 $10.74 $ 79.38
FY2cc.s/06 s t7.4s $7.15 8.0230 7.4810 $35 91 $I 1.69
FY2W6/O7 s 2274 $ 22.26 7.6730 7.3740 $68.38 $40.3I
FY2@7/08 $ 26.85 $ 26.14 5.8970 5.6555 $50.42 $25.33
rY2008/o9 $ 26.90 $ 2s.89 s.8930 5.6555 $50.59 $25.94
rY2C09/0 $ 24.70 $ zs.zt 5.9123 s.6555 $38.74 $15.73
FY20 o/I $ 22.10 $ 20.e7 6.5025 6.2 r55 $36.55 $12.1A
FY20 1/2 $ 21.98 $ 20.7s 6 4539 6. r 655 $34.75 $11.29
FY20 3 $ 23.07 $ 22.02 6.3477 6.0909 $39.10 $t 4.Jt
FY20 3/4 $ 24.66 s 23.64 6.1 163 s.8634 $43.26 $17.41
N20 4/5 $ 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 or 30%, than it was in FY 1999/00.
TOTAL COIV|BINED MILLAGE
1o-oo(rc
9-@OO
a.moo
7-@OO
(u
?6 6.0000
E
6' 5.OOOOqot!
=
4.m@
=3-qxlo
2.moo
1-OO@
t)-moo
9a 99 00 01 02 (}3 (x 05 06 07 0a 09 Lo 7.7. 7.2 t3
Fiscal Years
878
FY 2014115 Proposed Millage Rate
July 23,2014
Page 11
FIRST PUBLIC HEARING
The first pubtic hearing on the proposed millage rates and tentative budgets for FY 2014115
must be held no later t[an 80 days or earlier than 65 days from the start of the TRIM ("Truth ln
Millage"l calendar (July 1st). Other guidelines are: 1) the public hearing cannot be scheduled on
a SuiOay 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 10,2014, at 5:01 P.M., in the City Commission Chambers, City Hall, and 1700
Convention Center Drive, Miami Beach, Florida.
LM/JW
@
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 MTLLAGE 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 TNFORMATION TO THE MIAMI.DADE
COUNTY PROPERry APPRAISER IN THE FORM
REQUIRED BY SECTION 200.065, FLORIDA STATUTES
WHEREAS, Section 200.065, Florida Statutes, has specified the method by which
municipalities may fix the millage rate and adopt an annual budget; and
WHEREAS, development of the FY 2014/15 budget began early in the year and 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 capitalfunding and reserve; and
WHEREAS, maintaining and enhancing the City's priorities have become
increasingly more chaltenging 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 Citywide 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 citywide and 276 positions across all funds) in a
General Fund budget that is $264.1 million in FY 2013114, which is only 11o/omorcthan 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 2O13l14,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 2011112, 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 Citywide 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 $t.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 fo|IowiNg
recommendations of the Administration be and are hereby ratified for transmittal to the
Miami-Dade County PropertyAppraiser, as specified in Section 200.065, Florida Statutes:
1) Proposed Millage Rates for FY 2014115
General Operating 5.7551 milts
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 23d day of July,2014.
ATTEST:
RAPHAEL E. GRANADO, CITY CLERK
MAYOR PHILIP LEVINE
ao 0? tlo(rt\'/t' city"Aftomey 'Date
882
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883