Miami Beach Commissioners on Friday set a preliminary tax rate for the 2013-2014 budget year that is slightly lower, and could put the city in a budget crunch if union contracts don’t get approved.
Commissioner Jerry Libbin, who is running for mayor, motioned to advertise a tax rate below what city staff had recommended.
Staff proposed a tax rate of $6.34 per $1,000 of taxable property value, or .0039 less than last year. Libbin suggested a tax rate of $6.14, which commissioners approved.
Since property values have increased in Miami Beach, some homeowners may see a slightly higher tax bill. State law caps the increase in assessed value of homesteaded properties at 1.7 percent this year.
Taking into account the cap, the owner of a $200,000 home taking the standard homestead exemption would pay about $942 in taxes to Miami Beach. That would be a decrease of about $10 compared to this year.
The decrease leaves an additional $4 million shortfall for city staff to plug. That’s on top of an anticipated $3 million shortfall, according to a city analysis. The city is still tinkering with its budget, which has to be finalized by September.
To help balance the budget, the city is counting on union concessions of about $5 million that have been negotiated but not accepted by union members. Further complicating matters, commissioners on Friday proposed additional changes to the police union’s contract which were not approved by Fraternal Order of Police leaders in negotiations. One of the proposed changes would cap the amount of overtime and off-duty pay that counts toward police officer’s pensions.
“If the unions do not negotiate this and we take this action, it’s really hard to undo it,” said Commissioner Deede Weithorn. “We will lose the window to change the pension savings.”
The tax rate and city budget are still subject to public hearings before becoming final. After commissioners set a preliminary rate, the final rate can go down but is difficult under state law to raise it.