Boynton Beach is cutting its property tax rate for the fiscal year that starts Oct. 1.
The city, however, will also raise its water rates and fire assessment fee, potentially offsetting the money that the property tax rate cut will save homeowners.
The City Commission on Sept. 16 voted to lower its property tax rate by 7%, dipping into the city's savings to help make up for lost revenue. They also voted to raise its water utility rates by 17.25%, on top of their move to raise the fire-rescue fee on Sept. 8.
The tax rate for Oct. 1 to Sept. 30, 2027, will be a fraction of a penny less than $7.21 per $1,000 of property value, down from about $7.75.
The average taxable value of a single-family home in Boynton Beach is about $228,000, calculations based
on preliminary Palm Beach County Property Appraiser figures show, putting the tax at about $1,643 under the new rate, or about $124 less than the current one.
With the water utility rate increase, a residential household using 5,000 gallons monthly will have to pay $136 more over the next year, the city's chief financial officer, Alan Lawson, told commissioners on Sept. 16.
The increase was needed, utility director Poonam Kalkat said Sept. 8, to raise $300 million for upgrades to the city's two water plants to bring them in line with federal regulations on cleaning forever chemicals, known as Perfluoroalkyl and polyfluoroalkyl substances, or PFAS.
The city's annual fire assessment fee, which helps pay for its fire-rescue department, will rise by $25 on Oct. 1 for property owners, bringing the total to $170. This will be the second year in a row commissioners approved an increase of that amount.
The $138.3 million budget commissioners approved Sept. 15 is $2 million less than what the city spent this fiscal year.
"It was painful, but it was necessary," Lawson said Sept. 8.
The city estimates that tax cut alone will cost it $4.3 million. Contractually obligated raises will cost an additional $4.3 million.
To offset the hits to the city's bottom line, the city expects to bring in an additional $1.7 million through the higher fire fee.
The city also plans to save $3 million by leasing vehicles instead of buying them.
A hiring freeze City Manager Dan Dugger put in place this year will continue into 2027, for an estimated savings of $1.7 million over 2026.
Other cuts, including a cellphone stipend to employees, will save an estimated $800,000. Workers affected by the stipend cut can apply for a city-issued phone, Lawson said.
About 50 positions across municipal departments remain vacant, Lawson said Sept. 8, including for six police officers. The police department has 166 officers, Police Chief Joe DeGiulio said Sept. 8.
The hiring freeze followed three months of hiring 27 employees but losing 28, for a net savings of about $900,000.
The city is also taking $1.8 million out of its nearly $30 million in savings to help cover its losses in tax revenue.
Even with Boynton Beach officials' attempts to cut taxes and spending, the potential for substantial property tax cuts looms across Florida.
If at least 60% of voters statewide approve a state constitutional amendment in November that raises homestead exemptions, City Commissioner Thomas Turkin said Sept. 8, "It's going to create a significant challenge." Boynton Beach and other cities will need to raise fees such as the fire assessment fee, he said.
The city has estimated it will lose $18 million to $22 million in revenue if voters approve the tax cuts.
Email news tips and ideas to Chris Persaud at cpersaud@pbpost.com.
This article originally appeared on Palm Beach Post: What to know about new Boynton budget: Tax rate down, other fees up
