Key Biscayne council members voted Tuesday to advertise a proposed tax rate of $3 per $1,000 in taxable home value — the same rate as this year.
Once the village advertises the proposed tax rate, it can’t normally increase but could go down.
In general, when the tax rate stays the same, homeowners pay slightly more due to rising home values. For owner-occupants, the state constitutional limit of this increase is 1.5 percent this year. But owners of commercial property or vacation homes could see larger increases based on the market value of their property.
Tuesday’s vote was 5-2, with council members Edward London and Michael Kelly dissented. They wanted the tax rate cut to $2.50 since the village has a lot of money in reserves – funds set aside for emergencies or other future needs.
Vice Mayor Michael Davey said advertising the current rate gives the council greater flexibility.
“If we set it low now we're not going to be able to examine what our needs are come September,” he said.
But Kelly was not convinced.
“We never tap in to all of our reserves and they've increased during the past year,” Kelley said. “I don't foresee why we would increase taxes, no matter what projections you envision.”
The village now has $26 million in reserves and is expecting $7.5 million more next month. The money comes from a surplus of unspent money on different projects throughout the years.
Mayor Frank Caplan said although the key has a lot in reserves, that much of it is “restricted,” meaning it can only be used for limited purposes.
Council members will have two budget workshops where members could decide to cut the tax rate.
The first and second public hearings will take place on Sept. 9 and 23 at 7 p.m. in the Council Chamber, which is located on the second floor of Key Biscayne's fire station.