Delray commissioners OKs tax hike, will continue to seek ways to cut

By DAVID SEDORE, Palm Beach Business.com

DELRAY BEACH — City commissioners Tuesday agreed to raise the property tax rate for the upcoming fiscal year but they’re still hoping to hold the line at the present rate as they continue to work on the budget.

The increase, if it holds, means Delray property owners would pay 30 cents more per $1,000 of assessed value than they would under the present rate. On a home valued at $300,000, that would translate to a tax bill of $2,073 versus $1,973, or $91 more, under the present rate.

City Manager David Harden said keeping the current rate would leave the city budget short of funds needed to maintain city streets, parks and building adequately.

“In addition, we would lose some programs that make Delray Beach distinctive,” Harden said.

City commissioners agreed.

“You’re not really saving money when you cut back on maintenance,” Mayor Rita Ellis said. “You pay one way or you pay another way.”

Even with the rate hike, Delray likely will eliminate four jobs from the city’s payroll; without the hike, as many as eight more jobs would have been axed.

The property tax reforms approved by voters and the Legislature the past two years have left Delray with a big hole in the budget for the year that begins Oct. 1. The present tax rate leaves the city needing to lop $8 million from the budget; the 30-cent rate increase shrinks the gap to $6 million.

That same package of reforms also limit what commissioners may do as far as raising taxes. The 30-cent hike is the maximum that can be approved by a simple majority vote of commissioners. Any higher would require approval by two-thirds of the commissioners.

Commissioners aren’t slated to approve the budget until Sept. 16, but they needed to set a proposed rate at Tuesday’s meeting in order to allow the county property appraiser’s office to send out notices to taxpayers early next month.

Harden said there is a little wiggle room in the budget; the city has been told it can cut its contribution to the police and fire pension fund by $243,000, and it’s possible the Community Redevelopment Agency will up its contribution to the city.  

DDA tax hike gets OK — for now

In a related matter, commissioners approved a tax rate hike proposed by the Downtown Development Authority in order to meet the property appraiser’s deadline. Commissioners had little information on why the DDA needs the hike, but they will have until Sept. 16 to review the authority's budget.

The increase translates into a $23,000 increase in revenue for the DDA.