Palm Beach County commissioners voted Tuesday to keep the county’s property tax rate the same for the eighth straight year, locking in a $52 million windfall because of rising property values.
Excluding taxes collected for debt, fire rescue and library services, county residents will pay $4.78 for every $1,000 in taxable property value.
Over the past year, that tax rate generated $845.6 million for county operations. With a strong economy contributing to rising property values, the same tax rate is expected to generate $898 million for fiscal year 2019, which begins on October 1.
Including taxes collected for debt but not those collected for fire rescue or library services, the owner of a $255,000 house with homestead exemptions will pay about $26 more in property taxes in 2019 compared to 2018.
Commissioners could have cut the property tax rate so the county would collect roughly the same amount in tax revenue it got last year. But faced with more residents needing more services, they voted unanimously Tuesday to hold the property tax rate flat so the county could use the additional $52 million in the 2019 budget.
“The cost of business continues to rise every year,” Commissioner Dave Kerner said. “Our obligation is to provide a safe environment for our constituents, and this budget allows us to do that. We’re all committed to reducing the (property tax rate), but not at the expense of the progress we’ve made as a county.”
Much of the heavy lifting for the 2019 budget has been done.
County Administrator Verdenia Baker presented a proposed budget in June that kept property tax rate flat, provided an additional $25.8 million to the Palm Beach County Sheriff’s Office, boosted reserves and provided for a 3 percent pay increase for county employees.
Commissioners, who have the final say on the budget, largely nibbled on the edges of the $4.8 billion budget, directing Baker to tweak the document to include additional money for a pair of new positions in the Office of Inspector General and more money for the guardian ad litem program.
Two factors made this year’s budget deliberations less difficult than they might have been.
First, PBSO, which accounts for nearly half of the money the county spends on various offices and departments, scaled back its request.
“We’re lucky in that the sheriff cut back his request by $30 million or $40 million,” Commissioner Hal Valeche said.
The second bit of good fortune for the county was that the property appraiser’s office underestimated the amount of money the county would collect because of rising property values by about $3 million.
Baker said the county needed every penny of additional money.
“Costs have continued to escalate,” she said. “We also needed it for capital projects and environmental protection and to continue to fight the opioid crisis. We also increased our reserves in anticipation of making sure we can address any disasters and to make sure our bond rating remains where it is.”
Bond rating agencies, whose analysis determines how much interest governments pay when they borrow money, expect governments to have healthy reserves. The proposed budget would leave the county with $128.4 million in reserves, more than enough for the county to hold its AAA bond rating.
Those reserves are key during hurricane season, when a storm could force the county to immediately find money to pay for cleanup and repairs. Reserves can be a direct source of money to address those needs, and they can help the county borrow more money to cover them while it waits — often for years — for federal reimbursement.
Even with most of the work on the budget complete, the public can provide its input during a pair of hearings in September. The first one is scheduled for September 4 and the next one, when the budget is expected to be finalized, is slated for September 17.
Both meetings will begin at 6 p.m.