Proposed tax rate will help sustain high quality of life in Sunny Isles Beach

By Bari Auerbch


Ever since Sunny Isles Beach incorporated in 1997, the City Commission and members of city staff have been committed to drafting fiscally responsible budgets with the goal to maintain the highest level of services along with the lowest possible property tax rates. The following tax rate synopsis chronicles a “history of prosperity” thanks in part to revenue generated from new construction windfalls - now helping to cushion budget shortfalls in tough economic times.
   
Proposed 2009/2010 Budget

Members of the Sunny Isles Beach City Commission, City Manager Rick Conner, department heads and city staff have begun methodically studying the proposed fiscal year 2009/2010 $26.2 million budget seeking to cut costs; make the most of budgetary dollars in all city departments; and perpetuate the highest quality of life in the city becoming internationally renowned as “Florida’s Riviera.”

While the challenges of balancing budgets have been making headlines in Miami-Dade and Broward Counties, Sunny Isles Beach elected officials remain optimistic that new construction projects in the city such as Trump Towers and Jade Ocean will help prevent the need to significantly cut back the scope of municipal services residents appreciate.  

While Sunny Isles Beach has ample budget reserve funds, the theme has been “conserve and reserve” wherever possible during budget discussions – especially considering the economic impact of taxable property values dropping by 2.6 percent, according to figures released in July by the Miami-Dade property appraiser's office.

A reduction in city revenue forecasts, mostly from property taxes as well as collecting less revenue from the building permit, code enforcement and business licensing departments created the need to propose a tax rate of $2.65 per $1,000 of assessed property value for the 20092010 fiscal year budget – still one of the lowest in Miami-Dade County. While the tax rate would rise from $2.48 (an increase of about seven percent) - due to the decrease in property values, most residents can ultimately wind up with a lower tax bill.

Although the 2009/2010 budget may be $3 million less than the ‘08/’09 budget, a $20 million loan recently approved by the City Commission will help fund new infrastructure projects, park development and property acquisitions to facilitate and perpetuate continued revitalization.

According to assistant city manager/finance Doug Haag and city manager Rick Conner, the $20 million will be re-paid over 20 years with legally available non ad valorem revenue. Mayor Norman S. Edelcup emphasized, “Property tax money will not be used to repay the loan.”

Sunny Isles Beach residents will reap the benefits as the $20 million goes a long way towards proactive projects such as maintaining and upgrading existing parks; landscaping enhancements; and infrastructure improvements including the undergrounding of utilities.

Already forging ahead with adding even more green open space and perpetuating upgrades on Sunny Isles Boulevard, the City Commission recently approved resolutions outlining agreements to acquire more land. The city is purchasing property from Malibu on the Bay in the amount of $4,800,000 for a proposed park at the south end of the city at 16100 Collins Avenue. The land at 151 Sunny Isles Boulevard is also being purchased from RK Associates VIII, Inc. in the amount of $9,000,000 in keeping with goals to enhance one of the main gateways to the city.

The public is invited to attend upcoming 2009/2010 budget hearings scheduled for Sept. 10 and Sept. 22, 6:30 p.m. at Government Center.

 ‘Tax Rate Retrospective’

Taking a look at the city’s “history of prosperity,” over the years, new multi-million dollar developments enabled city leaders to implement sweeping beautification and capital improvements while keeping property taxes low.

Tax Rate for Fiscal Year 2008/2009: $2.48 per $1000 of assessed value

A reduction in city revenue forecasts, mostly from property taxes, created the need to reduce staffing, consolidate departments and delay some capital projects. In order to help balance the ‘08/’09 budget, the tax rate was raised from $2.398 to $2.48 per $1,000 of assessed property value – still remaining one of the lowest property tax rates in Miami-Dade County (the millage rate for neighboring Golden Beach was $8.5000 per $1,000 of assessed property value in ‘07).

The Sunny Isles Beach ‘08/’09 budget included funding for a plethora of capital improvements and services including: First-year operations for the city’s new Pelican Community Park;  phased replacement of police and public service vehicles; completing a computer backup system for disaster recovery; Government Center modifications; park upgrades; landscaping work; Sunny Isles Boulevard improvements; undergrounding utilities; enhanced signage; and construction projects including the Newport Fishing Pier, a pedestrian/emergency vehicle bridge and Heritage Park garage.  

Tax Rate for Fiscal Year 2007/2008: $2.398 per $1000 of assessed value
While other local cities were worrying how tax reform would affect ’07-’08 fiscal year budgets, Sunny Isles Beach leaders anticipated the city would  be “exempt” from major project/service cuts thanks to new construction adding nearly $1 billion to tax rolls and impact fees paid by developers. According to a Herald article, “Only Miami, which is more than 20 times the size of Sunny Isles Beach, had more new buildings to pad its tax rolls in South Florida.”

At the time, property value assessments increased by 12 percent in Sunny Isles Beach (up from $251,450 to $324,735); and the 2007/2008 fiscal year budget featured a lower tax rate – dropping 19 percent from $2.95 per $1,000 of assessed property value to $2.398.

Despite the lower tax rate, the city still increased budget allocations for capital improvements by 94 percent (over $30 million up from $15.6 million), funded mostly by impact fees paid by developers. Projects slated include drainage enhancements, undergrounding of utilities and upgrades to Sunny Isles Boulevard as well as Town Center Park.

Tax Rate for Fiscal Year 2006/2007: $2.95 per $1,000 of assessed value

In 2006, the city’s total assessed property value had soared from $3.9 billion to $4.87 billion.
Even more good news for residents was that the property tax rate remained one of Miami-Dade’s lowest at $2.95 per $1,000 of assessed value. Less than 10 years since incorporating, the average assessed property value in Sunny Isles Beach increased by 17% in just the ’05-’06 fiscal year alone – escalating from $209,718 to $251,450.

Tax Rate for Fiscal Year 2005/2006: $2.95 per $1,000 of assessed value

The City Commission unanimously approved lowering taxes to $2.95 per $1,000 of a property’s assessed value from the previous rate of $3.35. The City Manager noted, “The growth of our tax base has also been consistent…The city had a 21 percent increase…for this proposed budget we went from about $3.2 billion to $3.9 billion which gave us the ability to propose a reduction in the tax rate.”

Tax Rate for Fiscal Year2004-2005: $3.35 per $1,000 of assessed value

During a budget workshop held on August 10, 2004, it was  announced the tax rate  for the 2004-05 fiscal year would yet again be one of the lowest in Miami-Dade County - $3.35 per $1,000 of assessed property value.

While the tax rate remained in the lowest 25 or 30 percentile of [Miami-Dade County], the city was still at the height of growth and development evidenced by an impressive rise in property values.

Over the previous year, the average assessed value of Sunny Isles Beach property rose by 18 percent to $205,916. Due to increased property values, homeowners ultimately wound up paying slightly more in property taxes to the city – but the dividends were a plethora of expanded services and the continuation of sweeping capital improvement/beautification projects.

At this time, the city’s tax base exceeded $3.2 billion – up from about $2.5 billion in 2003.  This was the biggest [approximately 27%] increase in any single year that the city had since incorporating in 1997 - representing over $2.2 million of increased revenue. The [city’s] revenue from property tax was estimated to go from a little over $8 million to over $10.3 million.

Tax Rate for Fiscal Year 2003/2004: $3.35 per $1,000 of assessed value

The Sunny Isles Beach City Commission approved the fiscal year 2003-2004 budget with no increase in taxes thanks in part to escalating assessed property values topping $2.5 billion at the time. While different points of view about issues such as view corridors and other zoning regulations continued to be debated at City Commission meetings, census data showed [single family] home values rose 100 percent in Sunny Isles Beach – the greatest increase in Miami-Dade and Broward within the previous decade.

Tax Rate for Fiscal Year 2002/2003: $3.35 per $1,000 of assessed value

In order to fund sweeping capital improvements, the City Commission approved a $3.35 property tax rate – up from $2.650 the previous year. The City Manager explained, “Revenues from the $3.35 property tax rate  (about $1.4 million) will be utilized totally to fund capital projects…The city will still have one of the lowest (the fourth lowest) property tax rates in Miami-Dade County.”

The late Mayor David Samson noted at the time, “The  [$3.35 property tax] increase only comes on the municipal tax and the amount is ‘infintesible.’ We all want to ensure this city will be a ‘beautiful thing to behold’ and we’re doing it for pennies.”

Current Mayor Norman Edelcup, then a Commissioner, added “Based on the current tax base, which is making us fiscally sound, we’re not depending on any future growth to fund these improvements…Surveys also show the magnitude of improvements can increase property values by about 20% beyond the already escalating market.”

It was also pointed out that growth pertaining to assessed values was better than anticipated – rising from $1.8 billion to about $2.2 billion – a $400 million increase.

Tax Rate for Fiscal Year 2001/2002: $2.650

In Fiscal year 2001/2002, the millage rate increased slightly. The City Manager explained at the time, "After giving taxpayers a break for several years, we had more services and steadily brought the millage rate back up. This means the average Sunny Isles Beach property owner (with a $25,000 homestead exemption) paid about $34 more in taxes to the city - but rising property values also played a role in the increase.”

ccording to the Miami-Dade County property appraiser's office, an average Sunny Isles Beach home [during this time] was assessed at $122,000 - $8,000 more than the previous year's assessed value of $114,000.

Tax Rate for Fiscal Year 2000/2001: $2.500

At this time, there was an accompanying increase in costs associated with providing new services and the 2000-2001 budget was the first time they were being fully funded. Therefore, the city's budget called for a millage rate adjustment from $2.303 to $2.50 per $1,000 of assessed property value.

Tax Rate for Fiscal Year 1998/1999: $2.399; Fiscal Year 1999/2000: $2.303

In '98, the city dropped the millage rate to $2.399 per $1,000 of assessed property value; and then again to $2.303 in '99. This was a decrease of over 15 percent from the days of Miami-Dade County's $2.683 millage rate prior to incorporation - however the reduction happened at a time when the city was not yet funding or providing the level of services residents began appreciating.

Tax Rate for Fiscal Year 1997/1998: $2.683 per $1,000 of assessed property value

In 1997, Sunny Isles Beach became a newly incorporated city and residents were looking forward to receiving higher levels of service above and beyond what was previously provided by Miami-Dade County. Today, the proposed property tax rate for the 2009/2010 fiscal year is $2.65 per $1,000 of assessed property value – and virtually everywhere you look around Sunny Isles Beach the ongoing quest to make the city “first rate” is more evident than ever.