As his administration prepares to ask voters to approve a hefty bond initiative, Miami Mayor Tomás Regalado released a 2017 budget Thursday that would establish record spending levels for the city.
Valued at $670 million, the mayor’s proposed general fund budget, which pays for daily expenses like police, fire and parks, reflects a 4 percent increase from the current year. The total operating budget, including special funds, is proposed at $979 million.
The increased expenses are largely due to recent pay raises for the city’s 4,000 employees, and record staffing and spending on public safety. They’re made possible by a waning building boom that hiked the city’s property tax base by 13 percent to $44 billion — a level that tops peaks set in the mid-2000s.
With so much money coming in, Regalado has proposed keeping the city’s operating tax rate flat. But thanks to a reduction in the portion of property owners’ tax bills tied to debt service he can still tout a sixth straight year in which the overall tax rate paid to the city has been reduced, down to $8.23 for every $1,000 of a property’s taxable value.
Revenues are growing very quickly, but expenses have recently grown even more so.
Miami City Manager Daniel Alfonso
Estimates project the owner of the average Miami home with a homestead exemption would pay $1,020 in taxes to the city.
“We have checked and there is no record where the city of Miami for six years in a row has reduced property taxes. This is unprecedented,” Regalado said during a press conference at City Hall.
The largest increases in spending appear to be tied to public safety, due in part to expansion efforts that have pushed the staffing of sworn officers and brass past 1,300 and firefighters to about 750. According to the city’s figures, the fire department’s budget is increasing to $125 million, and police to $231 million, a combined jump of about 11 percent.
“Yes we’re at our highest budget ever. But we’ve never had a $230 million police budget before,” City Manager Daniel Alfonso said in an interview.
The budget is also climbing due to 5 percent raises for non-union employees, including Alfonso and City Attorney Victoria Méndez.
Millions in expenses for several projects and initiatives are also included in the budget, such as the money to create an office of resilience and sustainability to address issues like sea-level rise. Others include:
- $1.7 million for transportation projects
- $2.5 million for “anti-poverty” spending
- $2 million to pay for “in-kind” services tied to the 2017 Major League Baseball All-Star game at Marlins Park
- $300,000 to repair playgrounds around the city
- $500,000 for repairs at the Miami Children’s Museum
- $600,000 to help fund the construction of a skate park under I-95
The proposed spending plans comes in the tail end of a year in which city commissioners for the first time in years dipped into their now-robust reserves to help fund expenses like a new police helicopter and special capital funds for elected officials. Reserves are projected next year at $134 million, healthier than the city’s laws require, but Alfonso warns that the city needs to start reeling in expenses.
“Revenues are growing very quickly, but expenses have recently grown even more so,” he wrote in his budget message.
$1,020 Average tax on home under city of Miami’s proposed 2017 budget and tax rate. Figure represents city share only.
Still, Miami’s unions have generally believed Alfonso’s projections to be conservative. Lt. Javier Ortiz, Miami’s police union president, said he’s still reviewing the budget but at first glance disagrees with Alfonso’s warnings.
”We’re definitely not reaching a tipping point,” he said.
Some city commissioners have also expressed some skepticism about Alfonso’s recent warnings, in part because he’s currently pushing a $275 million bond initiative based on the fact that the city’s finances are at their healthiest point in more than a decade. Commissioners are expected to consider the issue on July 29, and could put the proposal before voters in November.
Alfonso said a list of items to be funded should be ready next week, and Regalado acknowledged Thursday morning that some commissioners are pushing back.
“I'm sure we will have very interesting conversations and public hearings on this issue,” the mayor said during a press conference, noting that ultimately decisions would be in the voters’ hands if commissioners agree to hold a referendum. “We don't decide. It's the people of Miami that decide.”