HomeMy WebLinkAboutLTC 097-2026 - Fiscal Year 2026 First Quarter AnalysisMIAMI BEACH
OFFICE OF THE CITY MANAGER
LTC#
TO:
FROM:
DATE:
SUBJECT:
LETTER TO COMMISSION
Honorable Mayor Steven Meiner and Members of the City Commission
Eric Carpenter, City Manager � Carp.
March 11, 2026
Fiscal Year 2026 First Quarter Analysis
The purpose of this Letter to the Commission (L TC) is to provide the Mayor and City Commission with
an update on the status of the Fiscal Year (FY) 2026 operating budget as of the first quarter, which
ended December 31, 2025, and to provide projections through the end of the current fiscal year ending
September 30, 2026.
It is important to emphasize that this analysis is a preliminary projection based on actual data for the first three (3) months of the current fiscal year, as well as any more recent data and information that
may be available. While these projections are not a definitive representation of trends for the remainder of the current fiscal year, they do provide an initial glimpse of potential areas of opportunity and/or
concern. Assumptions have been made relating to both revenues and expenditures that will continue
to be further refined as the current fiscal year progresses and more data and information become
available.
SUMMARY
As of the first quarter of the current fiscal year (FY 2026), revenue and expenditure projections for the General Fund through September 30, 2026 reflect a projected year-end surplus of approximately $4.4 million, while the Resort Tax budget reflects a projected year-end surplus of approximately $1.5 million.
On December 17, 2025, 'the City Commission adopted Resolution No. 2025-34056, directing the
Administration to develop the FY 2027 operating budget using the projected rolled-back millage rate.
This approach is expected to reduce revenues by approximately $20.0 million across both the
operating and capital budgets. In addition, several proposals currently being considered by the Florida Legislature may further reduce property tax revenues.
Given these anticipated impacts, it is essential that we plan carefully and make thoughtful financial
choices. To support a stable and balanced FY 2027 budget, the Administration recommends that any
excess funds remaining at the end of FY 2026 be reserved for one-time uses in accordance with the
City's financial policies. This approach will allow the City to address emerging needs, while maintaining
the City's long-term fiscal health and avoiding new recurring commitments during a year of expected revenue constraints.
Of the $4.4 million General Fund surplus projected as of the first quarter of the current fiscal year, it is recommended that approximately $0.4 million, which is based on the additional combined FY 2026
projected surplus from the Miami Beach a11d Normandy Shores Golf Courses' operations, be set aside
and transferred to the Capital Pay-As-You.:Go (PayGo) Fund to fund a portion of the Miami Beach Golf
Course Renovation project. This project currently has an estimated cost totaling $9.2 million, of which $6.3 million has been funded as of the current fiscal year.
097-2026
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 2 of 14
After accounting for the item above,the Administration recommends that the remaining General Fund
surplus of approximately $4.0 million be set aside to be transferred to capital funds for appropriation
in the FY 2027 Capital Budget.
For Resort Tax,it is recommended that the projected FY 2026 surplus of $1.5 million as of the first
quarter be transferred to the General Fund for tourism-eligible expenditures incurred in the General
Fund.
FY 2026 General Fund 2%Resort Tax
'
Projected Surplus/Shortfall)as of Q1 $4,445,000 $1,546,000
Recommended Year-end Adjustments/Set Asides:
Set aside Additional Projected FY 2026 Golf Course Surplus (Miami Beach (450,000)-and Normandy Shores)for Miami Beach Golf Course Renovation Project
Set aside for FY 2027 Capital Projects (3,995,000)-
Additional Contribution from 2%Resort Tax to General Fund for Tourism-(1,546,000)Eligible Expenditures Incurred in General Fund -
Remaining Projected Surplusl(Shortfall)as of Q1 $-$-
RESERVES
The preliminary General Fund reserve as of September 30,2025 is $120.6 million,which is the
equivalent of three (3)months,or 25%,of the adopted FY 2026 General Fund budget of $482.5 million.
The final audited reserve amount as of September 30,2025 will not be known until the City's annual
financial audit,which is currently underway,is finalized in the coming months.The current reserve
policy for the General Fund reflects a requirement of two (2)months,with a goal of three (3)months,
pursuant to Resolution No.2024-33340,which was adopted by the Mayor and City Commission on
October 30,2024.
The preliminary 2%Resort Tax reserve as of September 30,2025 is $37.9 million,which is the
equivalent of six (6)months,or 50%,of the adopted FY 2026 2%Resort Tax budget of $75.8 million.
Similar to the General Fund,the final audited reserve amount as of September 30,2025 will not be
known until the City's annual financial audit is finalized.The current reserve policy for the 2%Resort
Tax budget reflects a minimum of two (2)months,with a goal of six (6)months,pursuant to Resolution
No.2019-30664 that was adopted by the Mayor and City Commission on January 16,2019.
The City's reserve levels and targets are adjusted annually based on the annual operating budgets in
accordance with the City's current reserve policies.As a result,additional funding requirements for
these reserves will be re-evaluated once the FY 2025 audit has been completed and during the FY
2027 budget development process.
FIRST QUARTER ANALYSIS
All General Fund,Enterprise,Internal Service,and Special Revenue Funds,including the City Center
RDA and North Beach CRA,year-end expenditures are projected to be at or below their current FY
2026 amended budgets and revenues are projected to be equivalent to or in excess of expenditures,
with the exception of certain General Fund departments,the Risk Management Internal Service Fund,
and the Transportation &Mobility Special Revenue Fund,which will be discussed further in the
analysis below.
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 3 of 14
GENERAL FUND
First Quarter Status
An analysis of actual operating revenues and expenses for the period October 1,2025 through
December 31,2025 reflects an operating surplus of approximately $163.6 million.While the actual
surplus as of December 31,2025 may seem unusual compared to the projection for the current fiscal
year ending September 30,2026,it should be noted that the City receives a large percentage of its
annual ad valorem property tax revenues during the first several months of the fiscal year and there is
often a lag in processing of expenditures,particularly those that are billed by outside entities.
Ad valorem property tax revenues represent approximately 62.0%of the total General Fund revenues
budgeted based on the adopted FY 2026 General Fund budget,and 82.4%of actual General Fund
revenues that have been collected during the first three months of the current fiscal year.
As of December 31,2025,total revenues collected in the General Fund were 52.3%of the current
amended budget,or $264.8 million,primarily due to the large percentage of property tax revenues
collected during the first three months of the current fiscal year.Conversely,expenditures were 20.0%
of the current amended budget,or $101.2 million,since there are often delays in the receipt and
processing of expenditures until the close of the fiscal year.
FY 2026 Budget
Adopted Amended 1/4 of Amended Preliminary Variance from 1/4
General Fund Budget Budget Budget Actuals as of Amended Budget
12/31/2025 Over /(Under)
Revenues $482,497,000 $506,340,000 $126,585,000 $264,799,667 $138,214,667
Expenditures 482,497,000 506,340,000 126,585,000 101,153,062 (25,431,938)
Excess of Revenues Over/(Under)Expenditures $163,646,605
Year-End Projections
Year-end operating revenues and expenditures projected through September 30,2026 provide a
preliminary indication of any estimated year-end surpluses or shortfalls as of this point in time.While
the actual revenues and expenses reflected in this analysis are as of December 31,2025,these
projections do incorporate more current information that may be available.
A summary of the preliminary General Fund revenues and expenditures as of December 31,2025,
with projections through September 30,2026,reflects a projected year-end surplus of approximately
$4.4 million.
Of the $4.4 million General Fund surplus projected as of the first quarter of the current fiscal year,it is
recommended that approximately $0.4 million,which is based on the additional combined FY 2026
projected surplus from the Miami Beach and Normandy Shores Golf Courses'operations,be set aside
and transferred to the Capital Pay-As-You-Go (PayGo)Fund to fund a portion of the Miami Beach Golf
Course Renovation project.This project currently has an estimated cost totaling $9.2 million,of which
$6.3 million has been funded as of the current fiscal year.
After accounting for the item above,the Administration is recommending that the remaining General
Fund surplus of approximately $4.0 million be set aside to be transferred to capital funds for
appropriation in the FY 2027 Capital Budget.
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 4 of 14
FY 2026 Budget
General Fund Adopted Amended Projected Difference %Over /(Under)Budget Budget
Revenues $482,497,000 $506,340,000 $509,785,000 $3,445,000 0.7%
Expenditures 482,497,000 506,340,000 505,340,000 (1,000,000)-0.2%
Excess of Revenues Over/(Under)Expenditures $4,445,000
Additional Projected Golf Courses Surplus for MB Golf Course Renovation Project (450,000)
Set aside for FY 2027 Capital Projects (3,995,000)
Remaining Excess of Revenues Over/(Under)Expenditures $-
Operating Revenues
As of December 31,2025,actual operating revenues collected in the General Fund were
approximately 52.3%of the current amended budget,or $264.8 million,with operating revenues
through the fiscal year ending September 30,2026 projected at approximately $509.8 million,which
is 0.7%,or $3.4 million,above the current amended budget.
General Fund revenues by category projected to exceed budget or with significant variances to budget
in excess of 10%,or $300,000,are further explained below:
Other Taxes -This category includes revenues from gas and electric franchise fees,as well as
utility taxes on telephone,electricity,and gas services and is projected to be above the current
amended budget by 4.9%,or $1.4 million,primarily due to electricity-related franchise and utility
tax revenues that are trending higher than expected due to current usage levels and overall
economic activity.
Charges for Services-This category includes revenues from the operations of the Miami Beach
and Normandy Shores golf courses;activities and programs offered by the Parks and Recreation
Department,such as after-school and summer classes;and public safety,passport,
ambulance/rescue,and lot-clearing services.It is projected to be above the current amended
budget by 3.5%,or $633,000,primarily due to higher-than-anticipated revenues from both golf
courses,which continue to outperform expectations based on strong usage and demand.
Fines and Forfeits -This category,which includes traffic fines,violations and false alarm fees,
and code enforcement violations,is projected to be above the current amended budget by 6.8%,
or $143,000.The increase is primarily driven by higher-than-expected collections from code
enforcement violations and fines,both of which are continuing to trend above historical levels.
Interest -This category is comprised of various sources of interest income derived from the
City's current investments and is projected to be 26.0%,or $2.1 million,above the current
amended budget due to higher than anticipated interest rates and returns based on favorable
market conditions.
Rents and Leases -This category includes revenues from various rentals and leases of City
owned properties.FY 2026 revenues are projected to be 8.8%,or $823,000,below the current
amended budget primarily due to revenues from several of the City's leases trending lower than
budgeted since revenues collected by the City for some of its leases and agreements are based
on a percentage of sales.
Miscellaneous -This category,among other things,includes revenues from various beach
concessions,special events,lien statement fees,and several types of reimbursements.FY 2026
revenues are projected to be 0.6%,or $106,000,above the current amended budget.This
increase is primarily driven by lien statement fees that are collected by the City when property
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 5 of 14
owners,title companies,or other requestors seek official verification of outstanding liens during
real estate transactions,which continue to trend higher than anticipated due to ongoing real
estate activity within the City.
For a detail of all General Fund revenues by category,refer to the attached Exhibit A.
Operating Expenditures
As of December 31,2025,actual expenses were 20.0%,or $101.2 million,of the current amended
budget with operating expenditures through the fiscal year ending September 30,2026,projected at
approximately $505.3 million,which is 0.2%,or $1.0 million,below the current amended budget.
General Fund expenditures by department projected to exceed budget or with significant variances to
the budget in excess of 10%,or $300,000,are further explained below:
Public Works -The department is projected to be below the current amended budget by 2.3%,
or $437,000,primarily due to several positions that have remained vacant longer than anticipated.
These vacancies have proven difficult to fill because of factors such as the competitive labor
market,specialized skill requirements,and limited applicant pools.While these unfilled positions
present operational challenges,they are projected to result in current year projected savings at
year-end.The department continues to explore targeted recruitment strategies to address these
staffing gaps.
Public Works
FY 2026 FY 2026 Projected vs
Amended Budget Projected Amended %Over /(Under)
Budget Variance
Expenditures $19,367,000 $18,930,000 $(437,000)-2.3%
Police -The department is projected to be above the current amended budget by 0.9%,or $1.6
million.This variance is driven primarily by an anticipated $3.3 million overage in the FY 2026
overtime budget.The increased overtime costs stem from several factors,including higher-than-
expected court-related overtime and continued expenditures to maintain elevated police visibility
throughout the City following the October 2023 attacks,in order to ensure public safety.
Although the department recently reached full staffing in its sworn ranks,vacancies in both sworn
and non-sworn positions during the first quarter of FY 2026 have generated salary savings that
partially offset the projected overtime overage.
The Administration will continue to monitor the department's expenditures during the remainder of
the fiscal year,with a goal towards identifying savings to offset these unbudgeted overtime
expenditures in the department's General Fund budget,and if necessary,amending the
department's budget at year-end to realign projected savings from other existing General Fund
department budgets to fund these unbudgeted overtime expenditures.
Police
FY 2026 FY 2026 Projected vs
Amended Budget Projected Amended %Over /(Under)
Budget Variance
Expenditures $167,132,000 $168,712,000 $1,580,000 0.9%
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 6 of 14
While the above-listed General Fund departments comprise those projected to have significant
variances to budget in excess of 10.0%or $300,000;or exceed their current amended budgets,all
other departments within the General Fund are projected to have savings at year-end.
For a detail of General Fund expenditures by department,refer to the attached Exhibit A.
RESORT TAX
The City's Resort Tax budget is primarily funded by taxes collected under Chapter 67-930 (Section 6)
of the Laws of Florida,as amended,and Section 5.03 of the City of Miami Beach Charter,as amended.
This legislation authorizes the use of Resort Tax revenues to promote the City's tourism industry,
which encompasses a broad range of eligible activities,including City services in tourism areas,
enhanced services during high-impact periods,special event sponsorships,advertising,promotional
events,convention bureau activities,capital improvements and maintenance of related physical
assets,as well as covering the reasonable and necessary expenditures associated with collecting,
handling,and processing the tax.
2%Resort Tax
Based on actual collections from October 2025 through January 2026,total two percent (2%)Resort
Tax revenues for FY 2026 are projected to be approximately 3.6%,or $2.8 million,above the current
amended budget.This projection assumes that revenues for the remaining months of the current fiscal
year will continue to trend at approximately 1%above the FY 2025 collections,consistent with the
trend over the past twelve months,during which collections have averaged about 1%higher than the
preceding twelve-month period.
Total FY 2026 2%Resort Tax expenditures are projected to be 1.6%,or $1.2 million,above the current
amended budget by year-end.This projected overage is largely due to additional costs associated
with the enhanced public safety measures that were implemented during the College Football National
Championship that surpassed the FY 2026 budget allocation by approximately $0.9 million,as well as
a $0.3 million increase in the combined contributions to the Miami Beach Visitor and Convention
Authority (VCA)and Greater Miami Convention &Visitors Bureau (GMCVB)that are based on a
percentage of two percent Resort Tax collections projected above budget.
1%Resort Tax (Quality of Life)
The proceeds of the one percent (1%)bed tax,as adopted through Resolution No.2018-30512,and
continuing in FY 2026,are to be utilized as follows:60%allocated for Transportation initiatives in
tourism-related areas;10%allocated equally among North Beach,Middle Beach and South Beach for
capital projects that enhance Miami Beach's tourism-related areas;and 10%allocated to various arts
and cultural programs through the Cultural Arts Council (CAC).
Based on actual collections from October 2025 through January 2026,one percent bed tax revenues
for FY 2026 are projected to be 1.2%,or $0.2 million,below the current amended budget.Because
the contributions to Transportation initiatives in tourism-related areas,North,Middle,and South Beach
quality-of-life projects,and various arts and cultural programs funded by the CAC are tied directly to
one percent bed tax collections,expenditures are also projected to be 1.2%,or $0.2 million,below the
current amended budget.Of this amount,$134,000 corresponds to Transportation initiatives,$66,000
to North,Middle,and South Beach quality-of-life projects combined,and $22,000 to CAC-funded arts
and cultural programs.
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 7 of 14
1 %Resort Tax (Convention Center)
Similarly,revenues from the additional one percent (1 %)bed tax that are levied exclusively to fund the
expansion,renovation,improvement,and related debt service of the Miami Beach Convention Center,
as well as capital renewal and replacement needs,are projected to be 1.2%,or $0.2 million,below the
current amended budget.Because the proceeds must first cover debt service,with any remaining
balance set aside for capital renewal and replacement based on additional one percent collections,
expenditures funded by the additional one percent bed tax are projected to be 1.2%,or $0.2 million,
below the amended budget at year-end.
Total Resort Tax
Overall,based on actual collections from October 2025 through January 2026 and assuming
collections for the remaining months of the fiscal year continue to trend at approximately 1%above
FY 2025 levels,consistent with the prior twelve-month trend,combined Resort Tax revenues are
projected to be 2.1 %,or $2.3 million,above the current amended budget as of year-end.Expenditures
are projected to be 0.7%,or $0.8 million,above the current amended budget as of year-end.As a
result,the year-end surplus is projected at approximately $1.5 million,which the Administration
recommends be transferred to the General Fund to support tourism-eligible expenditures incurred in
the General Fund.
FY2026 FY 2026 Preliminary %Actual of Over/(Under)%Over/(Under)
Adopted Amended Actuals asof Amended Amended Amended
Budget Budget 12/31/2025 Budget Budget Budget
Revenues
2%Resort Tax 72,774,000 72,774,000 11,543,255 15.9%74,990,000 2,216,000 3.0%
Interest Income/Miscellaneous 2,102,000 2,102,000 678,719 32.3%2,677,000 575,000 27.4%
Fund Balance/Retained Earnings/PYSurplus 915,000 2,136,000 0.0%2,136,000 0.0%
1%Resort Tax (QOL)17,915,000 17,915,000 2,446,543 13.7%17,693,000 (222,000)-1.2%
Additional 1%ResortTaxfor ConventionCenter 17,915,000 17,915,000 2,446,543 13.7%17,693,000 (222,000)-1.2%
Total Revenues 111,621,000 112,842,000 17,115,061 15.2%115,189,000 2,347,000 2.1%
Expenditures
General Fund Contribution 41,247,000 41,247,000 10,311,750 25.0%41,247,000 0.0%
Sanitation Fund Contribution 3,362,000 3,362,000 840,500 25.0%3,362,000 0.0%
Contribution toGMCVB 8,987,000 8,987,000 (1,137,302)-12.7%9,200,000 213,000 2.4%
Contribution toVCA 3,494,000 3,494,000 268,074 7.7%3,600,000 106,000 3.0%
Contribution to Mt.Sinai 1,000,000 1,000,000 0.0%1,000,000 0.0%
OtherOperating/Other Uses 17,701,000 18,922,000 2,496,080 13.2%19,848,000 926,000 4.9%
NB,MB,SBQOL Capital,Transp,andArts 17,915,000 17,915,000 2,446,543 13.7%17,693,000 (222,000)-1.2%
Addt'1 1%Conv.CenterDebt Service &Cap.Ren&Repl.17,915,000 17,915,000 0.0%17,693,000 (222,000)-1.2%
Total Expenditures 111,621,000 112,842,000 15,225,645 13.5%113,643,000 801,000 0.7%
Revenues Over/(Under)Expenditures 1,889,415 1,546,000 1,546,000
Revenues Overl(Under)Expenditures 1,546,000
Additional ResortTaxContribution to General Fund forTourism-Eligible Expenditures in General Fund (1,546,000)
Remaining Revenues Overl(Under)Expenditures
ENTERPRISE FUNDS
The City accounts for goods and services provided by a department to external users on a
fee-for-service basis as Enterprise Funds.The City's Sanitation,Sewer,Storm Water,Water,Parking,
Building,and Convention Center operations comprise this category of Proprietary Funds.
Year-end operating revenue and expenditure projections through September 30,2026 provide an
indication of anticipated year-end surpluses or shortfalls as of this point in time.Revenues for all
Enterprise Funds are projected to be equivalent to or in excess of expenditures as of year-end.In
addition,all Enterprise Funds budgets are projected to be under budget.
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 8 of 14
ENTERPRISE FUNDS
Building Convention Parking Sanitation Water Sewer StormWaterCenter
FY2026 Adopted Budget 21,757,000 46,528,000 57,284,000 27,386,000 48,820,000 68,802,000 41,470,000
FY2026 Amended Budget 21,852,000 48,265,000 58,236,000 29,133,000 51,934,000 70,806,000 42,660,000
FY2026 Projections:
Charges for Services 20,812,000 29,113,000 44,380,000 26,192,000 49,143,600 69,344,000 40,878,000
Other 849,000 18,162,000 16,321,000 1,634,000 3,303,400 3,438,000 2,729,000
Use of Fund Balance/Retained Earnings 69,000 666,000 1,057,000
FY2026 Revenue Projections 21,730,000 47,941,000 60,701,000 28,883,000 52,447,000 72,782,000 43,607,000
$Over/(Under)Amended Budget (122,000)(324,000)2,465,000 (250,000)513,000 1,976,000 947,000
%Over/(Under)Amended Budget -0.6%-0.7%4.2%-0.9%1.0%2.8%2.2%
FY 2026 Expenditure Projections 21,730,000 47,941,000 57,355,000 28,883,000 51,228,000 69,474,000 42,324,000
$Over/(Under)Amended Budget (122,000)(324,000)(881,000)(250,000)(706,000)(1,332,000)(336,000)
%Over/(Under)Amended Budget -0.6%-0.7%-1.5%-0.9%-1.4%-1.9%-0.8%
Revenues Over/(Under)Expenditures 3,346,000 1,219,000 3,308,000 1,283,000
An analysis of actual operating expenses for the period October 1,2025 through December 31,2025
reflects that all Enterprise Funds have actual expenses that are less than one quarter of their current
amended budgets.It is important to note that this is not representative of trends for a full fiscal year,
as there is often a lag in the processing of expenditures,particularly those billed by outside entities for
services provided.
ENTERPRISE FUNDS
Building Convention Parking Sanitation Water Sewer StormWaterCenter
FY 2026Adopted Budget 21,757.,000 46,528,000 57,284,000 27,386,000 48,820,000 68,802,000 41,470,000
FY 2026 Amended Budget 21,852,000 48,265,000 58,236,000 29,133,000 51,934,000 70,806,000 42,660,000
1/4 Adopted Budget 5,439,250 11,632,000 14,321,000 6,846,500 12,205,000 17,200,500 10,367,500
1/4 Amended Budget 5,463,000 12,066,250 14,559,000 7,283,250 12,983,500 17,701,500 10,665,000
Preliminary Revenues as of 12/31/2025 6,436,454 888,406 16,015,593 6,955,481 10,649,463 15,151,205 9,690,273
Preliminary Expenditures as of 12/31/2025 4,098,699 1,416,580 6,972,472 6,041,131 8,747,940 13,248,770 3,288,338
Expenditures Above/(Below)1/4 Amended Budget (1,364,301)(10,649,670)(7,586,528)(1,242,119)(4,235,560)(4,452,730)(7,376,662)
%Variance -25.0%-88.3%-52.1%-17.1%-32.6%-25.2%-69.2%
These projections will continue to be refined further as additional information becomes available.
INTERNAL SERVICES FUNDS
The City accounts for goods and services provided by one department to other departments on a
cost-reimbursement basis through Internal Services Funds.Central Services,Fleet Management,
Information Technology,the Office of the Inspector General,Facilities Management,Risk
Management,and Medical and Dental comprise this category of Proprietary Funds.
Year-end operating revenue and expenditure projections through September 30,2026 provide an
indication of anticipated year-end surpluses or shortfalls as of this point in time.Similar to the
Enterprise Funds,revenues for all Internal Services Funds are projected to be equivalent to or in
excess of expenditures as of year-end.In addition,all Internal Services Funds budgets are projected
to be under budget,with the exception of the Risk Management Fund budget detailed further below.
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 9 of 14
INTERNAL SERVICES FUNDS
Central Fleet Information Medical &Inspector Facilities Risk
Services Management Technology Dental General Management Management
FY2026 Adopted Budget 1,139,000 21,071,000 21,677,000 57,146,000 2,167,000 12,952,000 30,155,000
FY2026 Amended Budget 1,180,000 21,730,000 22,123,000 57,259,000 2,267,000 13,768,000 30,354,000
FY 2026 Projections:
Charges for Services 824,000 19,626,000 18,779,000 2,160,000 12,526,000 22,619,000
Other 56,000 1,298,000 506,000 56,979,000 10,000 243,000 3,533,000
Use of Fund Balance/Retained Earnings 299,000 -2,739,000 40,000 719,000 5,317,000
FY 2026 Revenue Projections 1,179,000 20,924,000 22,024,000 56,979,000 2,210,000 13,488,000 31,469,000
$Over/(Under)Amended Budget (1,000)(806,000)(99,000)(280,000)(57,000)(280,000)1,115,000
%Over/(Under)Amended Budget -0.1%-3.7%-0.4%-0.5%-2.5%-2.0%3.7%
FY 2026 Expenditure Projections 1,179,000 20,924,000 22,024,000 56,979,000 2,210,000 13,488,000 31,469,000
$Over/(Under)Amended Budget (1,000)(806,000)(99,000)(280,000)(57,000)(280,000)1,115,000
%Over/(Under)Amended Budget -0.1%-3.7%-0.4%-0.5%-2.5%-2.0%3.7%
Revenues Over/(Under)Expenditures -
Risk Management-This fund is projected to be 3.7%,or $1.1 million,above the current amended
budget,primarily due to increases in general liability,workers comp,and public official claims and
case reserves for claims incurred but not reported (IBNR)trending higher than budget based on
the latest actuarial projections as of the first quarter of the current fiscal year.Since claims
fluctuate,the trend will continue to be monitored over the coming months.If these trends continue
at current levels for the remainder of the fiscal year,the projected overage will be addressed at
year-end through the use of prior year fund balance available in the Risk Management Fund.
An analysis of actual operating revenues and expenses for the period October 1,2025 through
December 31,2025 reflects that all Internal Services Funds have actual expenses that are less than
one quarter of their current amended budgets with the exception of Central Services Fund budget,due
to certain operating expenditures that occur disproportionately early in the fiscal year rather than being
evenly distributed throughout the year.
INTERNAL SERVICES FUNDS
Central Fleet Information Medical &Inspector Facilities Risk
Services Management Technology Dental General Management Management
FY 2026 Adopted Budget 1,139,000 21,071,000 21,677,000 57,146,000 2,167,000 12,952,000 30,155,000
FY 2026 Amended Budget 1,180,000 21,730,000 22,123,000 57,259,000 2,267,000 13,768,000 30,354,000
1/4 Adopted Budget 284,750 5,267,750 5,419,250 14,286,500 541,750 3,238,000 7,538,750
1/4 Amended Budget 295,000 5,432,500 5,530,750 14,314,750 566,750 3,442,000 7,588,500
Preliminary Revenues as of 12/31/2025 216,080 5,480,675 4,819,513 13,384,277 543,428 3,221,195 6,417,452
Preliminary Expenditures as of 12/31/2025 306,189 1,626,390 4,231,757 12,128,029 452,185 2,423,612 2,976,566
Expenditures Above/(Below)1/4 Amended Budget 11,189 (3,806,110)(1,298,993)(2,186,721)(114,565)(1,018,388)(4,611,934)
%Variance 3.8%-70.1%-23.5%-15.3%-20.2%-29.6%-60.8%
These projections will continue to be refined as additional information becomes available.
SPECIAL REVENUE FUNDS
The City's Special Revenue Funds are comprised of revenues and expenditures that are legally
restricted or committed for specific purposes other than debt service or capital projects,and they
support a wide range of dedicated programs and operations.These include Transportation &Mobility
operations,7"Street Garage operations,5 &Alton Garage operations,the Tourism and Hospitality
Scholarship Program,Information and Communications Technology,Education Initiatives,Franchise
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 10 of 14
Waste Haulers and Sustainability,the Residential Housing and Homeless Relocation Programs,Red
Light Camera Program operations,Emergency 911 (E-911),Miami Beach Cultural Arts Council (CAC),
Festival of the Arts,Normandy Shores and the City's three Security Guard Special Taxing Districts
(Biscayne Point,Biscayne Beach,and Allison Island),Miami City Ballet,Art in Public Places (AiPP),
Tree Preservation and Commemorative Tree Trust,Beachfront Concession Initiatives,Beach
Renourishment,Resiliency,Sustainability and Resiliency,and Biscayne Bay Protection Trust,Police
Confiscation Trusts (Federal and State),Police Training and School Resources,and the Adopt-a-
Bench and Brick Paver Programs.
Year-end operating revenue and expenditure projections through September 30,2026 provide a more
realistic indication of any anticipated year-end surpluses or shortfalls as of this point in time.Revenues
for all Special Revenue Funds are projected to be equivalent to or in excess of expenditures as of
year-end and all Special Revenue Funds budgets are projected to be under budget,except for the
Transportation &Mobility Fund that is further detailed below.
Transportation &Mobility -Expenditures in the Transportation &Mobility Fund are projected to
be 5.0%,or $751,000,above the current amended budget.This increase is primarily attributable
to the 15%rate adjustment for the City's existing trolley service that was approved by the Mayor
and City Commission on February 5,2026.The Administration will be conducting a comprehensive
review of operating line-item expenditures across this fund.This review will focus on identifying
opportunities to reprioritize or defer non-essential spending,evaluate service efficiencies,and
explore potential cost-containment measures.The goals of this effort are to mitigate the impact of
the trolley-related cost increases,maintain core service levels,and ensure the long-term fiscal
sustainability of the Transportation &Mobility Fund.
Transportation &Mobility
FY 2026 FY 2026 Projected vs
Amended Budget Projected Amended %Over I (Under)
Budget Variance
Revenues $14,951,000 $15,702,000 $751,000 5.0%
Expenditures 14,951,000 15,702,000 751,000 5.0%
Surplus/(Shortfall)$-$-$-
An analysis of actual operating revenues and expenses for the period October 1,2025 through
December 31,2025 reflects that all Special Revenue Funds have incurred less than one quarter of
their current amended budgets in actual expenses,with the exception of the People's Transportation
Plan (PTP)Fund and the Police Confiscation Trusts (Federal and State).These funds incurred certain
operating expenses that are concentrated more heavily at the beginning of the fiscal year rather than
occurring evenly throughout the year.Similar to other funds,the actual expenses incurred as of
December 31,2025 are not typically representative of trends for a full fiscal year.
CITY CENTER RDA
The City Center Redevelopment Agency (City Center RDA)is a blended Special Revenue Fund and
a separate legal entity whose Chairperson and Board of Directors are the City's Mayor and City
Commission.Its funding must be used within the boundaries of the City Center RDA in accordance
with the approved redevelopment plan and the amended interlocal cooperation agreement.The
primary revenue source is a portion of the tax increment financing (TIF)revenues,specifically 95
percent of the increment,levied and paid annually by Miami-Dade County and the City on properties
located within the geographic boundaries of the City Center RDA.
Revenues for the City Center RDA are projected to align with expenditures at year-end,with
expenditures expected to be at or below the current amended budget.It is important to note that in
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 11 of 14
accordance with the most recent amended interlocal cooperation agreement,any surplus/savings
realized from the City Center RDA's annual operations at year-end must be set aside and utilized to
pay off the outstanding debt that was issued in 2015 for the expansion and renovation of the Miami
Beach Convention Center.
FY 2026 FY 2026 Preliminary %Actual of Over/(Under)%Over/(Under)
Adopted Amended Actualsas of Amended Amended
Budget Budget 12/31/2026 Budget Amended Budget Budget
Revenues
Tax Increment Funds -City 36,255,000 36,255,000 36,255,082 100.0%36,255,000 0.0%
Tax Increment Funds -County 28,315,000 28,315,000 28,315,547 100.0%28,315,000 0.0%
Interest lncome/Mscellaneous 397,000 397,000 235,213 59.2%292,000 (105,000)-26.4%
Fund Balance/Retained Earnings/PY Surplus 6,366,000 6,366,000 0.0%6,366,000 0.0%
Total Revenues 71,333,000 71,333,000 64,805,842 90.8%71,228,000 (105,000)-0.1%
Expenditures
Admin/Operating Expenditures 790,000 790,000 189,250 24.0%790,000 0.0%
Project Expenditures 14,170,000 14,170,000 3,167,446 22.4%14,170,000 0.0%
Reserves,Debt Service,and OtherObligations 56,373,000 56,373,000 1,031,000 1.8%56,268,000 (105,000)-0.2%
Total Expenditures 71,333,000 71,333,000 4,387,696 6.2%71,228,000 (105,000)-0.1%
Revenues Over/(Under)Expenditures 60,418,146
An analysis of actual operating revenues and expenses for the period October 1,2025 through
December 31,2025 reflects that the City Center RDA Fund has actual expenses that are less than
one quarter of the current amended budget.
While the City Center RDA Garages and Shops below are located within the geographical boundaries
of the City Center RDA,actual revenues and expenses as of December 31,2025 with revenue and
expenditure projections through September 30,2026 are being presented separately in order to
eliminate any misperception that the revenues generated from these facilities and their operations are
pooled with TIF revenues and other City Center RDA Trust Fund revenues.
Revenues for the City Center RDA Garages and Shops are all projected to be equivalent to or in
excess of expenditures as of year-end and expenditures are projected to be at or below the current
amended budgets.
RDAGARAGES AND SHOPS
Anchor Anchor Pennsylvania Pennsylvania Collins ParkAvenueGarageShopsAvenueGarageShopsGarage
FY 2026 Adopted Budget 3,014,000 1,494,000 1,085,000 291,000 1,574,000
FY 2026 Amended Budget 3,014,000 1,558,000 1,085,000 291,000 1,574,000
FY 2026 Projections:
Charges for Services 2,595,000 1,170,000 948,000 -1,587,000
Other 293,000 341,000 41,000 244,000 84,000
Use of Fund Balance/Retained Earnings --31,000 40,000 -
FY 2026 Revenue Projections 2,888,000 1,511,000 1,020,000 284,000 1,671,000
$Over/(Under)Amended Budget (126,000)(47,000)(65,000)(7,000)97,000
%Over/(Under)Amended Budget -4.2%-3.0%-6.0%-2.4%6.2%
FY 2026 Expenditure Projections 2,847,000 1,509,000 1,020,000 284,000 1,558,000
$Over/(Under)Amended Budget (167,000)(49,000)(65,000)(7,000)(16,000)
%Over/(Under)Amended Budget -5.5%-3.1%-6.0%-2.4%-1.0%
Revenues Over/(Under)Expenditures 41,000 2,000 --113,000
Letter to Commission -Fiscal Year 2026 First Quarter Analysis
Page 12 of 14
An analysis of actual operating revenues and expenses for the period October 1,2025 through
December 31,2025 reflects that the City Center RDA Garages and Shops all have actual expenses
that are less than one quarter of their current amended FY 2026 budgets.
RDAGARAGES AND SHOPS
Anchor Anchor Pennsylvania Pennsylvania Collins ParkAvenueGarageShopsAvenueGarageShopsGarage
FY 2026 Adopted Budget 3,014,000 1,494,000 1,085,000 291,000 1,574,000
FY 2026 Amended Budget 3,014,000 1,558,000 1,085,000 291,000 1,574,000
1/4 Adopted Budget 753,500 373,500 271,250 72,750 393,500
1/4 Amended Budget 753,500 389,500 271,250 72,750 393,500
Preliminary Revenues as of 12/31/2025 788,150 398,671 303,852 250 447,646
Preliminary Expenditures as of 12/31/2025 709,707 25,756 125,949 72,500 162,013
Expenditures Above/(Below)1/4 Amended Budget (43,793)(363,744)(145,301)(250)(231,487)
%Variance -5.8%-93.4%-53.6%-0.3%-58.8%
NORTH BEACH CRA
Similar to the City Center RDA,the North Beach Community Redevelopment Agency (North Beach
CRA)is a blended Special Revenue Fund and a separate legal entity whose Chairperson and Board
of Directors are the City's Mayor and City Commission.Its funding must be used within the boundaries
of the North Beach CRA in accordance with the approved redevelopment plan and interlocal
agreement.The primary revenue source is a portion of tax increment financing (TIF)revenues,
specifically 60 percent of the increment,levied and paid annually by Miami-Dade County and the City
on properties located within the geographic boundaries of the North Beach CRA.
Revenues for the North Beach CRA are projected to equal expenditures as of year-end and
expenditures are projected to be at or below the current year amended budget.It is important to note
that in accordance with the current North Beach CRA interlocal agreement,any surplus/savings
realized from the North Beach CRA's operations at year-end must be utilized in accordance with the
North Beach CRA redevelopment plan.
FY 2026 FY 2026 Preliminary %Actual of Over/(Under)%Over/(Under)
Adopted Amended Actualsasof Amended Amended Amended
Budget Budget 12/31/2026 Budget Budget Budget
Revenues
Tax Increment Funds -City 1,693,000 1,693,000 1,693,039 100.0%1,693,000 0.0%
Tax Increment Funds -County 1,322,000 1,322,000 1,322,182 100.0%1,322,000 0.0%
Mscellaneous Revenues 66,000 66,000 47,498 72.0%177,000 111,000 168.2%
Fund Balance/Retained Earnings/PYSurplus 2,954,000 0.0%2,954,000 0.0%
Total Revenues 3,081,000 6,036,000 3,062,719 60.7%6,146,000 111,000 1.8%
Expenditures
Admin/Operating Expenditures 118,000 118,000 16,198 13.7%107,000 (11,000)-9.3%
Project Expenditures 1,494,000 1,494,000 60,233 4.0%1,027,000 (467,000)-31.3%
Reserves,DebtService,andOther Obligations 1,469,000 4,423,000 0.0%4,901,000 478,000 10.8%
Total Expenditures 3,081,000 6,036,000 76,431 1.3%6,035,000 0.0%
Revenues Over/(Under)Expenditures 2,986,288 111,000 111,000
An analysis of actual operating revenues and expenses for the period October 1,2025 through
December 31,2025 reflects that the North Beach CRA Fund has actual expenses that are less than
one quarter of the current amended FY 2026 budget.
Letter to Commission --Fiscal Year 2026 First Quarter Analysis
Page 13 of 14
CONCLUSION
Across all General Fund,Enterprise,Internal Service,and Special Revenue Funds,including the City
Center RDA and North Beach CRA,year-end expenditures are projected to be at or below their current
FY 2026 amended budgets and revenues are projected to be equivalent to or in excess of
expenditures,with the exception of certain General Fund departments,the Risk Management Internal
Service Fund,and the Transportation &Mobility Special Revenue Fund as previously detailed in the
analysis above.
Current year financial trends will continue to be proactively monitored throughout the fiscal year,with
quarterly updates provided to the Mayor and City Commission as work progresses on developing the
FY 2027 budget.
Given the City Commission's directive to develop the FY 2027 operating budget using the projected
rolled-back millage rate,it is essential that we plan carefully and make thoughtful financial choices.To
support a stable and balanced FY 2027 budget,the Administration recommends that any excess funds
remaining at the end of FY 2026 be reserved for one-time uses in accordance with the City's financial
policies.This approach will allow the City to address emerging needs,while maintaining the City's
long-term fiscal health and avoiding new recurring commitments during a year of expected revenue
constraints.
EC/JDG/TOS/RA
Letter to Commission --Fiscal Year 2026 First Quarter Analysis
Page 14 of 14
EXHIBIT A
GENERAL FUND
FY2026 FY2026 Preliminary %Actual of I Over/(Under)%Over/(Under)
Adopted Amended Actuals as of Amended Amended Amended
Budget Budget 12/31/2025 Budget Budget Budget
REVENUES
Ad Valorem Taxes 288,381,500 288,381,500 207,690,315 72.0%288,381,500 0.0%
Ad Valorem Taxes -Pay-As-You-GoCapital 5,891,000 5,891,000 5,891,000 100.0%5,891,000 0.0%
AdValorem Taxes -Capital Renewal &Replacement 4,656,000 4,656,000 4,656,000 100.0%4,656,000 0.0%
OtherTaxes 28,947,000 28,947,000 5,377,897 18.6%30,371,000 1,424,000 4.9%
Licenses and Permits 26,765,000 26,765,000 10,055,607 37.6%26,674,000 (91,000)-0.3%
lntergovemmental 13,132,000 13,132,000 2,299,221 17.5%13,073,000 (59,000)-0.4%
Charges for Services 17,990,000 17,990,000 5,598,904 31.1%18,623,000 633,000 3.5%
Fines and Forfeitures 2,105,000 2,105,000 542,925 25.8%2,248,000 143,000 6.8%
Interest 8,108,000 8,108,000 4,841,048 59.7%10,220,000 2,112,000 26.0%
Rents and Leases 9,378,000 9,378,000 1,796,668 1.0%8,555,000 (823,000)-8.8%
Miscellaneous 16,869,500 16,879,500 2,107,081 12.5%16,985,500 106,000 0.6%
Other-ResortTaxContribution 41,247,000 41,247,000 10,311,750 25.0%41,247,000 0.0%
Other-Non-Operating Revenues 15,067,000 15,067,000 3,631,250 24.1%15,067,000 0.0%
Fund Balance/Retained Earnings/PYSurplus 3,960,000 27,793,000 0.0%27,793,000 0.0%
TOTALREVENUES 482,497,000 506,340,000 264,799,667 52.3%509,785,000 3,445,000 0.7%
EXPENDITURES
Mayor andCommission 4,283,000 4,418,000 860,695 19.5%4,379,000 (39,000)-0.9%
City Attorney 7,915,000 9,027,000 1,547,416 17.1%8,763,000 (264,000)-2.9%
City Clerk 2,762,000 3,001,000 562.,802 18.8%2,966,000 (35,000)-1.2%
CityManager 4,199,500 4,199,500 811,418 19.3%4,137,500 (62,000)-1.5%
Finance 8,564,000 9,051,000 1,872,926 20.7%8,954,000 (97,000)-1.1%
Human Resources 3,539,000 3,625,000 779,213 21.5%3,467,000 (158,000)-4.4%
Marketingand Communications 3,276,000 3,276,000 718,577 21.9%3,247,000 (29,000)-0.9%
Officeof Management and Budget 1,936,000 1,936,000 402,098 20.8%1,911,000 (25,000)-1.3%
Procurement 3,426,000 3,484,000 741.,413 21.3%3,450,000 (34,000)-1.0%
Code Compliance 7,571,000 7,571,000 1,645,566 21.7%7,354,000 (217,000)-2.9%
Economic Development 2,468,000 3,032,000 354,709 11.7%2,886,000 (146,000)-4.8%
Housing &CommunityServices 6,130,000 6,313,000 1,103,591 17.5%6,111,000 (202,000)-3.2%
Planning 6,039,000 6,274,000 1,295,032 20.6%6,178,000 (96,000)-1.5%
Tourism &Culture 4,127,000 4,185,000 761,869 18.2%4,139,000 (46,000)-1.1%
Capital Improvement Projects 6,441,000 6,461,000 1,268,371 19.6%6,198,000 (263,000)-4.1%
Environment &Sustainability 2,238,000 2,574,000 440,436 17.1%2,507,000 (67,000)-2.6%
Facilities Management 5,021,000 5,021,000 1,298,527 25.9%4,940,000 (81,000)-1.6%
Parks &Recreation 51,353,000 52,119,000 9,488,490 18.2%51,984,000 (135,000)-0.3%
Public Works 18,723,000 19,367,000 3,609,446 18.6%18,930,000 (437,000)-2.3%
Fire 132,515,000 134,079,000 30,614,754 22.8%133,957,000 (122,000)-0.1%
Police 166,723,000 167,132,000 39,000,862 23.3%168,712,000 1,580,000 0.9%
CitywideAccounts (netoftransfers below)9,164,000 19,424,000 1,974,852 10.2%19,823,000 399,000 2.1%
Capital Reserve 978,000 978,000 0.0%978,000 0.0%
Information &TechnologyTech 300,000 300,000 0.0%300,000 0.0%
Pay-As-You-GoCapital 11,234,000 17,890,000 0.0%17,890,000 0.0%
General Fund Reserve 3,128,000 3,128,000 0.0%3,128,000 0.0%
Budget Stabilization 113,500 113,500 0.0%113,500 0.0%
Capital Renewal &Replacement 5,760,000 5,760,000 0.0%5,760,000 0.0%
EducationInitiatives 1,951,000 2,062,000 0.0%1,638,000 (424,000)-20.6%
Streets andSidewalk Renewal &Replacement 360,000 360,000 0.0%360,000 0.0%
Sanitation 120,000 40,000 0.0%40,000 0.0%
Transportation &Mobility 139,000 139,000 0.0%139,000 0.0%
TOTAL EXPENDITURES 482,497,000 506,340,000 101,153,062 20.0%505,340,000 (1,000,000)-0.2%
REVENUES OVER/(UNDER)EXPENDITURES 163,646,605 4,445,000
REVENUES OVER/(UNDER)EXPENDITURES 4,445,000
SetasideofAdditional Projected GolfCourses SurplusforMiami BeachGolfCourse Renovation Project (450,000)
Set asidefor FY2027Capital Projects (3,995,000)
REMAINING REVENUES OVER/(UNDER)EXPENDITURES