St. Augustine Beach Poised to Enact Small Property Tax Cut

St. Augustine Beach property owners are poised to get a small property tax rate cut next year as the city eliminates a debt-service levy while keeping its operating millage rate flat.

The City Commission unanimously gave preliminary approval Tuesday to a 2.5-mill property tax rate and roughly $15.6 million budget for the 2027 fiscal year. Commissioners are expected to give their final approval at their Sept. 24 meeting.

Previously, commissioners had proposed a 2.67 mill rate, but Finance Director Patty Douylliez and staff managed to get the rate down to 2.5 after reworking the budget. Mayor Beth Sweeny and other commissioners thanked Douylliez for her team’s efforts.

“I know that’s been a huge undertaking, but I’m glad it paid off,” said Sweeny.

The city's operating millage will remain unchanged at 2.5 mills, or $2.50 for every $1,000 in taxable property value. But a separate 0.0841-mill debt-service levy charged this year will disappear, bringing the city's combined millage rate from 2.5841 to 2.5 mills.

That means a property with $500,000 in taxable value would owe about $42 less in city property taxes as a direct result of eliminating the debt-service millage, assuming its taxable value remained unchanged.

The reduction comes after four consecutive years of declining millage rates. The city's total rate stood at 2.95 mills in 2022, falling to 2.8 in 2023, 2.5887 in 2024, 2.5841 in 2025 and 2.5 in 2026, according to a budget presentation given Tuesday by Douylliez.

Despite the 3.3% lower overall tax rate, rising property values mean St. Augustine Beach expects to collect more operating property tax revenue next year. Gross taxable value increased from about $2.26 billion to $2.32 billion, with about $25.4 million of that $67.5 million increase coming from new taxable property.

According to statistics presented by Douylliez, the median household income in the city is now $153,800, roughly double the statewide average. Owner occupied homes make up 74% of residences, with a median value of $634,000.

At 2.5 mills, the city projects about $5.64 million in operating property tax revenue, assuming a 96% collection rate. That's about $164,000 more than would be generated had the commission adopted the rollback rate, which would have saved the median home $42 this year.

This year’s proposed budget totals $15.56 million, up from about $15.15 million this year. Douylliez said the $403,000 increase can be attributed to capital and grant projects.

The General Fund accounts for more than three-quarters of that spending at $11.92 million. The budget also includes $2.16 million for the Stormwater Fund, $624,825 for the Debt Service Fund, $441,620 from impact fees and $406,766 for the Road and Bridge Fund.

Personnel represents the city's largest spending category at 52% of the budget, totaling $8.09 million. Another $3.77 million is budgeted for capital expenses and $2.6 million is allocated for operating expenses. 

Even though debt-service millage is going away, about $865,000 of this year’s budget is classified as debt expenditures.

Within the General Fund, Police is the largest expense at about $4.16 million, followed by garbage at $1.43 million, other government services at $1.24 million, administration and finance at $1.23 million and roads and bridges at $1.07 million.

The budget assumes an estimated 3% increase in operating expenditures, closely mirroring July’s 3.4% inflation rate, and does not add any new staff.

City employees would receive a 3% salary increase, consisting of a 2.5% cost-of-living adjustment and 0.5% merit increase. Medical insurance costs are expected to increase 10.4%, while the city projects approximately $128,000 in annual savings on workers' compensation, auto, liability and property insurance.

The budget also includes an increase in solid waste non-ad valorem assessments.

Commissioners will consider final adoption of the budget and millage rate on Sept. 24 at 5:01 p.m.