FY 2026 Operating & Capital Budget Workshop – June 26, 2025
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FY 2026 Operating & Capital Budget Workshop – June 26, 2025
The Hollywood City Commission convened on June 26, 2025, for a workshop to review the proposed FY 2026 Operating Budget and Capital Improvement Plan (CIP). Staff presented a combined operating and capital budget overview, emphasizing public safety, community services, and infrastructure. No formal votes were taken, but the commission discussed taxable value trends, millage rates, capital projects, impact fees, and resident priorities.
Consent Calendar
- No consent calendar was presented; the meeting was a workshop with no formal approvals.
Public Comments & Testimony
- Bob Glickman, representing himself as a Hollywood Beach resident, expressed concerns over quarterly financial reporting frequency, population growth impacts on water/sewer capacity and flooding, and a perceived disconnect between water production costs and resident rates. He also warned that falling condo values due to insurance costs and new condo laws could worsen the downward trend in taxable value. He urged finding additional revenue streams.
Discussion Items
- Taxable Value and Economic Trends: Assistant City Manager Adam Reichbach reported a citywide taxable value of $27.3 billion (7.37% growth), but noted three consecutive years of declining growth since the 11.56% peak in FY 2023. New construction added $310 million; without it, growth would have been 6.15%. The CPI-linked second homestead exemption (up to 3% per year) will cost the city roughly $140,000 in net revenue this year, a compounding impact. Reichbach compared new construction values to peer cities: Fort Lauderdale $1.11B, Dania Beach $525M, Pompano Beach $395M, Hallandale Beach $260M, and Davie $231M.
- Proposed Millage Rate: The city proposed a total millage rate of 7.9805 mills (below 8 mills for the first time), with an operating millage of 7.4479 (flat from last year’s 7.465, after a reduction from 7.4665 in FY 2024). The reduction of 0.0327 mills saves the average single-family homeowner about $14.84 annually. The gross increase in tax revenue from June 1 values is approximately $10.8 million.
- Performance Accountability Officer: The budget includes a second performance and accountability officer to expand process improvement efforts across 17 departments. A report on the first officer’s return on investment is planned.
- FY 2026 Operating Budget: The total general fund budget increases from $398 million to $415 million (a $17 million increase). Of that, $13 million is on the expenditure side (from ~$349M to ~$362M), and the rainy-day 17% reserve grows from $48 million to $52 million. The budget adds 32 full-time positions citywide.
- Capital Improvement Plan Highlights: Staff outlined numerous projects, including: new police headquarters (interior work commenced); Hollywood Beach Golf Course; tidal flooding mitigation (notices to proceed on 10 sites); Art and Culture Center (substantial completion this summer); FAC corridor improvements; Rotary Park; traffic calming measures; Arts Park fence (~four months to completion); North Beach Utilities Undergrounding; and Gateway Monument signs (installation to begin in a few months). Completed projects include LED court lighting at David Park Tennis Center and Garfield paddle ball courts, fitness areas at Oak Ridge and Zinkel Parks, the Stan Goldman Skate Park (near completion, opening expected by Monday June 30), a dog park at Jefferson Park, the MLK Community Center improvements, and a new pickleball court at Driftwood Community Center.
- Grants and Impact Fees: The city has been awarded $19.5 million in grants in the first half of FY 2025, including $7.5 million for Sunset Park, $5.8 million for a CSLIP project on West Park Road, $4.1 million for Resilient Florida tidal flooding, $950,000 for Johnson Street Bridge, $481,000 for MLK renovations, $274,000 for a marine fuel pier project, and $250,000 for a fire station roof replacement. Pending grants total about $35 million. Impact fees (parks, fire, police, general government, multimodal transportation) are collected at building permit issuance and can only fund new or expanding capital infrastructure, not maintenance. The parks impact fee has the largest balance (~$4.3 million after planned funding for shade covers, a splash pad at Mara Berman Galante Park, and Stan Goldman Skate Park). Staff recommended funding restrooms at Point Siena Park from the remainder.
- Downtown CRA and Beach CRA: The downtown CRA has approximately $964,000 in unallocated funds; the beach CRA has about $2.1 million remaining after proposed expenditures. The beach CRA funds are restricted to the beach area.
- Commission Directions and Feedback:
- Mayor Levy suggested a resident survey (via New Horizons magazine) to gauge service satisfaction and priorities. He also advocated for reviewing the millage rate reduction at the September hearing, noting that matching last year’s reduction would be minimal but could accumulate over time.
- Commissioner Shuham requested that staff consider using GOB project contingency (police headquarters) to offset public safety equipment costs, and asked for an update on FDOT partnership opportunities at the Tri-Rail station. She also asked for a breakdown of the $7 million difference between the $10.8M property tax revenue increase and the $17M general fund increase (attributed to other revenue sources like CRA transition, fees, and franchise taxes).
- Commissioner Gruber expressed concern about the condo market driving a potential flat or declining real estate market and asked if the budget accounts for that. He supported using the beach CRA’s $2.1 million to redevelop Charno Park into a major family attraction, and suggested replacing the problematic recycled-water splash pads at Arts Park and Charno Park with freshwater systems (estimated $1.2 million each). He also favored using part of the $2.1 million for the Love Mosaic on the band shell (artist Say Adams, design pending).
- Commissioner Callari recommended using the remaining beach CRA funds for Charno Park and for pressure-cleaning/sealing the Broadwalk. She supported using parks impact fees for new pocket parks and land acquisition, and urged progress on a P3 for the circle (downtown) and on the Johnson Street parcel.
- Commissioner Biederman questioned the return on investment for the first performance accountability officer and supported using fire impact fees to avoid raising the fire assessment fee (staff noted that impact fees cannot fund replacement capital, only new facilities). He advocated for acquiring land for pocket parks in underserved areas and for park improvements at John Williams Park. He asked about the Plaza 441 development, requesting details, and inquired about the status of 70th Terrace improvements (staff confirmed it rolls over year-to-year).
- Vice Mayor Quintana emphasized using parks impact fees to address equity gaps highlighted by the Parks Master Plan, including creating a park within a 10-minute walk for all residents. She advocated for using city-owned linear park space along 441 to create a pocket park, and for activating underutilized community centers (Washington Park, Kether) through extended hours and staffing. She also promoted community adoption of traffic circles for green space and highlighted the need for stormwater retention in parks.
- Commissioner Hernandez focused on parking needs at existing parks (e.g., Boggs Field, Dowdy Field) and suggested using park impact fees or parking authority enterprise funds to acquire adjacent properties for parking. He supported using beach CRA funds for Charno Park and for environmental improvements (permeable concrete). He also proposed adding audio to the Broadwalk stage camera to enable live-streamed concerts and attract sponsorships, and requested detailed cost breakdowns for security bollards ($861,000 and $575,000).
Key Outcomes
- No formal votes were taken; the workshop was for discussion and direction setting.
- Staff will bring forward a report on the first performance accountability officer’s achievements.
- Staff will develop concepts for Charno Park improvements, with a focus on becoming a major family attraction.
- Staff will prepare options for allocating the remaining parks impact fee balance (~$3.7 million after Point Siena restrooms), with commissioners to work with staff in their districts to identify projects (e.g., parking, pocket parks, park enhancements).
- A resident survey on city service priorities will be explored for inclusion in New Horizons magazine.
- The maximum millage rate will be set at the July 2 commission meeting; a final decision on any reduction will come at the September public hearings (September 15 and September 25).
- Staff will investigate the feasibility of adding a third ladder truck (Ladder 40) using fire impact fees, along with personnel and placement details.
- Staff will provide a breakdown of the $17 million general fund increase and details on planned construction values in the pipeline.
- The commission will receive updates on CRA capital priorities, FDOT Tri-Rail station opportunities, and Sunset Park design/construction timelines at future meetings.
Meeting Transcript
All right, good morning, everyone. Today is June twenty sixth, twenty twenty-five. We are here for a workshop here at City Hall. We've got all of our city commissioners here and myself. It's great to see the uh executive management staff here. Everybody takes a uh obviously plays a big role into implementing uh the city's annual budget uh direction and its policy priorities. And so at this point, it is a pleasure to uh offer an opportunity for the city manager to uh open with the remarks uh regarding the fiscal year 2026 uh operating and capital budgets. Uh I did speak with the city manager right before the meeting and uh members of the body. It uh uh is our feeling that we would present the 2026 budget uh item uh for the operating budget, then we'll have a discussion feedback opportunity, and then after that, we'll get into a capital improvement plan and have uh comments and discussion about the capital improvement plans uh after that segment. So, city manager. Thank you, Mayor, Vice Mayor and Commissioners, and to all the members of the public and staff in attendance and watching out there. Um as the mayor indicated, uh, we're in a workshop session today. Uh typically we do these workshops in the past. Well, we've done them different ways. Sometimes we've done them separately, sometimes we've done them combined. This year we're doing them combined. So this truly is um one of the more important meetings that we hold throughout the year because we're scheduled for 10 a.m. to 1 p.m. today. Um, and if it does carry through the lunch hour like that, we'll have some food brought in to you at 12 so we can keep on going there. But it is it is an important session, so it is a workshop session, so no formal decisions are required today, but there'll be plenty of time for questions and discussion. And we when we put them together uh combined like this, think of it as two big beautiful budgets together, and we can we can present them in that fashion there for you. So you get the you I'm I'm just gonna keep on moving. Um you can you can see the relationship sometimes and the interconnects between the operating and the uh the capital budgets, and um as always, so things are still malleable at this point. Um they uh they they haven't been firmed up and they won't be firmed up until we till we get into the latter part of the fall. But the staff has been spending the last several months uh as we do throughout the city and all the offices and departments um putting together their recommendations, doing their analysis for where they are now uh and where they need to be next year and in the future beyond, looking at what's worked, what hasn't worked, what we need more of, what we need less of, where we need to provide more emphasis um and and fine-tune how we go forward. So you'll see an emphasis here on uh public safety um and community um uh service and uh and service delivery in general, and then a look to the future as the city celebrates its its hundredth year anniversary and looks to start the second century. Um as always, there's there's uh a great deal of flexibility left at this point, too. And uh and we do all that um by lowering the overall millage rate slightly, keeping the operating millage uh flat as recommended right now, and actually decreasing some of the debt service costs. So we're happy to present that as well. And with that, I will turn it over to Adam for the first part on uh on some of the uh operating, and then we'll we'll proceed after that as the mayor mentioned to capital. Okay, good morning. Adam Reichbeck, Assistant City Manager. So uh as the city manager referenced this morning, we're gonna provide you with a pretty comprehensive review of where we stand with the FY2026 proposed budget. And then first including um looking at our operating budget, and then we'll go switch over to the city's capital program. So as we approach this year's budget, uh we have been very cognizant of the economic conditions that we're all facing. We continue to contend with inflation and tariffs, which are reflective of the cost escalations and the increases associated on our ongoing contracts across all departments, and we continue to experience a volatile domestic uh economy by way of how the stock market and the uh labor market has been um running in the past uh several months. And this, of course, is an influence by both domestic and international conflicts that we are currently witnessing and experiencing. So we wanted to highlight this trend specifically as it relates to taxable value growth. You will see in the next uh several slides that we are very fortunate to see a citywide taxable value of 27.3 billion dollars based on the June 1st taxable value report. However, I would be remiss if I did not illustrate the reality of the trend that we are seeing. Since the high of 11.56% in fiscal year 2023, we have experienced three straight years of decline in our taxable value growth. This weighs extremely heavy as we go into this budget development process because it is a worrying trend that we will have to contend with as it relates to our ability to take on additional recurring expenditures. I also want to point out that the 7.37% growth was bolstered by a $310 million increase in our taxable value, and that's by way of new construction. And we'll touch on that in greater detail in a couple of slides. But I think it's important to point out that without that new growth, our taxable value would have been 6.15%. Lastly, I think it's worth mentioning as well that this is the first year that we are seeing the impact of the CPI growth on the second homestead exemption. So as you may recall, back in 2024, Florida's voters approved a measure in which we would see a CPI growth on the second homestead exemption. Uh the uh the applic uh on those properties that are that the second homestead exemption is applicable, and that's an amount up to 3% per year. And so while that number right now and the impact to the city of Hollywood is roughly $140,000 of net revenue that has been lost as a result of that, that number will continue to grow as that 3% is a compounding effect.
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