TOWN OF JUPITER 2020-2021

PROPOSED MILLAGE RATE

Contents:

Executive SummaryOrdinance 17-20

Presentation on Millage, Proposed FY 2021 Operations Budget and CIP

TOWN OF JUPITER MILLAGE RATE

Executive Summary Approval

EXECUTIVE SUMMARY:Staff seeks approval of Ordinance 17-20 for adoption of the 2021 millage rate of 2.4633 (excluding a debt service millage of .1891) for the fiscal year beginning October 1, 2020 and ending September 30, 2021. The proposed millage rate includes the ad valorem requirements to fund both operating and capital needs per State regulations. The operating and capital millage rate of 2.4633 is 3.17% higher than the rollback rate of 2.3877 as calculated by the State TRIM provisions.

In addition to the rate of 2.4633 to fund operating and capital needs, the Town has a voter-approved debt service millage of .1891, which results in a total millage rate of 2.6524. This combined rate represents a .0087 reduction from the combined rate in FY 2020.

The Town continues to operate in the most fiscally responsible manner with the goal of maintaining the operating portion of our millage rate. The assessed property values in the Town have increased from $11,381,790,376 in 2020 to $11,931,142,515 in 2021 including new construction. This increase in valuation of $549,352,139 or 4.83% includes new construction of $177,572,646 which accounts for 32% of the total increase in valuation. The 2021 new construction represents a slight increase from last year’s new construction value of $120,374,708. Even though this year saw a slight increase in new construction, the rate of growth in the Town specifically relating to new construction continues to decrease as the Town nears maturity

RECOMMENDATION:Approval of Ordinance 17-20 Adopting the Town of Jupiter millage rate for the fiscal year beginning October 1, 2020 and ending September 30th, 2021.

Strategic Priority:Fiscal Responsibility, Strong Local Economy

Attachments:Ordinance 17-20

Funding Source:Approved in Budget $ Sources:Additional Funding Required $ Sources:

*Funding is not necessary for this request

If additional information is needed please contact Scott Reynolds at scottr@jupiter.fl.us.

DATE: September 8, 2020TO: Honorable Mayor and Members of Town CouncilTHRU: Matt Benoit, Town ManagerFROM: Scott Reynolds, Budget ManagerSUBJECT: Consideration of Adopting Ordinance 17-20 to approve the Town of

Jupiter 2021 millage rate of 2.4633 for the fiscal year beginning October 1, 2020 and ending September 30, 2021.

ORDINANCE NO. 17-20

AN ORDINANCE OF THE TOWN COUNCIL OF THE TOWN OF JUPITER, FLORIDA, ADOPTING A MILLAGE RATE TO BE LEVIED BY THE TOWN OF JUPITER ON TAXABLE REAL AND TANGIBLE PERSONAL PROPERTY WITHIN THE TOWN FOR THE FISCAL YEAR BEGINNING OCTOBER 1, 2020 AND ENDING SEPTEMBER 30, 2021; STATING THE ROLLED-BACK MILLAGE RATE; STATING THE PERCENT BY WHICH THE MILLAGE RATE EXCEEDS, IF ANY, THE ROLLED-BACK MILLAGE RATE; AND LEVYING AD VALOREM TAXES ON ALL TAXABLE REAL AND TANGIBLE PERSONAL PROPERTY IN THE TOWN OF JUPITER FOR THE SAID FISCAL YEAR.

WHEREAS, pursuant to Chapter 166, Florida Statutes and Article VIII, §2 of the Florida Constitution the Town of Jupiter, Florida (Town) has the governmental, corporate and proprietary powers to conduct municipal government; and

WHEREAS, these powers include the power to adopt millage rates to be levied by the Town Council on all taxable real and tangible personal property within the Town each fiscal year; and

WHEREAS, the Town Council of the Town deems it necessary and advisable to adopt and levy a millage rate for the Town for the fiscal year 2020 - 2021; and,

NOW, THEREFORE, BE IT ORDAINED BY THE TOWN COUNCIL OF THE TOWN OF JUPITER, FLORIDA:

Section 1. In order to fund the budget of the Town, a millage rate is hereby adopted and levied by the Town Council of the Town, pursuant to the Laws and Constitution of the State of Florida, as follows:

A. Upon first reading hereof, the proposed millage rate computed to fund the Town's tentative budget is hereby approved and adopted in the sum of 2.4633 mills. For each $1,000.00 of assessed valuation, said millage rate will raise a tax of $2.46.

B. Upon second reading hereof, the final millage rate computed to fund the Town's final budget is hereby approved and adopted in the sum of ________ mills. For each $1,000.00 of assessed valuation, said millage rate will raise a tax of $ ___.

Ordinance 17-20Page 2

Section 2. The rolled back millage rate computed by the Town pursuant to the instructions furnished by the Palm Beach County Property Appraiser for the fiscal year 2020-2021 is 2.3877 mills. The percentage by which the above specified millage rate to be levied by the Town exceeds, or is less than, the rolled-back rate, is as follows:

A. The proposed millage rate is 3.17% higher than the rolled-back millage rate. This figure is declared to be the percentage increase in property taxes for the Town proposed to be adopted by the Town Council.

B. The final millage rate is __% higher than the rolled-back millage rate. This figure is declared to be the percentage increase in property taxes for the Town actually adopted by the Town Council.

Section 3. In order to fund the voter approved debt service for the Town, a millage rate of .1891 is hereby adopted by the Town Council of the Town, pursuant to the Laws and Constitution of the State of Florida.

Section 4. Pursuant to the millage rate aforesaid, the following amount of ad valorem taxes shall be raised and collected by the Town for municipal purposes and expenses for the fiscal year beginning October 1, 2020 and ending September 30, 2021, to-wit:

Under the proposed millage rate: $29,389,983

Under the final millage rate: __________

Section 5. Pursuant to the applicable provisions of the Florida Constitution, the Laws of the State of Florida and the Charter of the Town , there is hereby levied a general municipal millage rate as above stated, respectively, upon the dollar amount of the assessed valuation of all taxable real and tangible personal property in the Town as returned by the Palm Beach County Property Appraiser in the Town's behalf and fixed by the Town Council as shown by the 2020 tax roll for the Town , allowing the homestead and all other lawful exemptions as shown therein.

Section 6. The millage hereby levied, as above stated, respectively, is hereby approved and certified by the Town Council of the Town, pursuant to the laws of the State of Florida.

Ordinance 17-20Page 3

Section 7. The ad valorem taxes hereby levied are for the purpose of raising funds, revenues and moneys to be used, set aside and expended for the functions and purposes of the municipal government of the Town pursuant to the Constitution and Laws of the State of Florida and the Town Charter.

Section 8. The ad valorem taxes which are hereby levied are in excess of and above all other revenues to be received by the Town of Jupiter and are to be collected during the fiscal year beginning October 1, 2020 and ending September 30, 2021. All such ad valorem taxes so specified and levied are ordered to be extended upon the tax rolls, books and records of Palm Beach County in the proper millage in proportion to the valuation of such property as returned by the Palm Beach County Property Appraiser and fixed by the Town Council of the Town.

Section 9. The Finance department shall furnish a certified copy of this Ordinance upon first and second readings, respectively, to the Palm Beach County Property Appraiser, the Palm Beach County Tax Collector and the Department of Revenue of the State of Florida, as required by Law

Section 10. This Ordinance shall take effect immediately upon its execution.

First Public Hearing September 8, 2020

Fiscal Year 2021 Proposed Operating Budget &

Community Investment Program

Fiscal Year 2021 Budget Meetings:

• June 25, 2020 – Operating Budget Workshop

• July 21, 2020 – Set TRIM and date of first public hearing

• August 13, 2020 – CIP Workshop

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Budget Objectives & Assumptions

Objectives • Structure a proposed budget that allows for a flat millage rate which will result in modest

increases for residents and businesses based on property valuation increases. • Make investments in public safety, maintenance of infrastructure, landscaping. • Support strategic priorities of the Town Council. • Maintain or enhance levels of service through the covid - 19 recession.

Assumptions • Ad valorem (property) tax revenues higher than FY 2020 due to minimal increase in

property value and new construction. • Preserved salary adjustments to stay competitive in the area market.

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Property Valuations Historical Perspective

• The Town has traditionally been an agency within the county that has one of the highest percentage increases in property valuations, but that trend has now reversed as we are approaching build - out and only limited new construction is occurring.

• The table to the right indicates the Town’s total taxable valuation along with the percentage increase for each fiscal year presented.

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Total Expenditure Overview• Proposed FY 2021 Operating Budget

represents a $1.6 million increase over FY 2020.

• General Fund decreased $20,320 overall due to reductions in state shared/interest earnings revenue. To compensate for revenue reductions the Town reduced operating expenses.

• Sales Tax Debt Service retirement. Collected funds moved to General Fund Operating in FY21.

FUND ADOPTED PROPOSEDGeneral Fund 55,611,511 55,591,191Water Fund 26,097,648 27,735,514Stormwater Fund 3,519,038 3,567,388Building Fund 4,340,214 4,372,105Total Operating 89,568,411 91,266,198

Debt Service 7,048,625 2,142,925

Community Investment Program (CIP) 5,946,503 7,210,838

Insurance Fund 8,005,251 8,267,113

TOTAL 110,568,790 108,887,074

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General Fund – Solutions to Covid-19 Impacts

Dept. Open Positions Total CostPD Police Officer (4) 423,127PD Community Service Officer (1) 77,373PWP Service Worker (2) 132,182Engineering Student Intern (1) 5,382P&Z Student Intern (1) 5,382P&Z Planner (1) 94,488P&Z Admin Asst II (1) 74,478Recreation Neighborhood Svc Prgm Sp (1) 80,368

892,781

CURRENTLY PROPOSED IN BUDGET

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To deal with the $1.3 million revenue shortfall due to the Covid - 19 pandemic and the BTR relief funding of $400k. The following solutions are offered:

1. The deferring or not funding of vacant positions should be viewed as a stop gap measure. If this approach is not taken, fund balance would be used to fund positions that have not been filled.

2. A use of fund balance should be looked at as a one-time use only not to fund on going operations. The big unknown is what will happen next year and FY2022. Still a number of unknowns going forward.

As a reminder, any impact to ad valorem tax from the pandemic would not be felt till next fiscal year. In addition to impacts to state shared revenues and ad valorem unknowns is the unknown of possible state mandates which the Town might be forced to deal with next year.

Revenue Reductions:General Fund Impacts:Covid-19 BTR Relief Funding 400,000Covid-19 Revenue Reduction Impact 1,324,099TOTAL IMPACT 1,724,099

How to Balance the Budget

Option 1 - Currently Proposed in BudgetEleminate proposed One-Time Cash transfer to CIP (500,000)Defer for one year the funding of open positions (892,781)Reduce Contingency Balance (223,443)Unassigned Fund Balance (107,875)

(1,724,099)

Option 2Eleminate proposed One-Time Cash transfer to CIP (500,000)Reduce Contingency Balance (223,443)Unassigned Fund Balance (1,000,656)

(1,724,099)

General Fund Revenues

Highlights:

• $1 million increase in Ad Valorem tax collection.

• Small use of fund balance due to state revenue reductions.

• Intergovernmental – Increase due to sales tax revenue being fully

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recognized as operating revenue.

Actual Adopted ProposedREVENUES: 2018 - 2019 2019 - 2020 2020 - 2021 Taxes - Current Ad valorem 21,903,765$ 22,788,395$ 23,848,988$ Taxes - Utility 5,082,420 5,268,817 5,156,000 Franchise fees 4,796,052 4,800,000 4,800,000 Taxes - Other 3,993,094 3,987,545 3,745,846 Licenses and permits 586,778 507,300 506,100 Intergovernmental 3,180,692 2,850,785 6,676,873 Charges for services 4,868,692 5,350,801 4,706,836 Solid Waste Collection Revenue 3,704,607 3,536,960 3,779,487 Fines and forfeitures 217,148 279,000 205,000 Interest 2,357,102 1,018,267 543,267 Miscellaneous 429,357 208,150 203,150 Transfers -Sales Tax Debt Fund 3,982,708 3,800,000 - CRA Cost Reimbursement 300,000 715,491 811,769 CRA Loan Repayment - 500,000 500,000 Fund Balance - - 107,875

TOTAL REVENUES 55,402,415$ 55,611,511$ 55,591,191$

General Fund ExpendituresHighlights:

• Small reduction over FY 2020 original budget.

• 4 % salary increases (2% market adjustment and 2% merit) for non - union employees (across all operating funds ).

• PBA salary adjustment as adopted by Town Council in November 2019.

• 5 % increase in health insurance premiums (across all funds ).

• No surplus transfer to the CIP fund.

Actual Adopted ProposedEXPENDITURES: 2018 - 2019 2019 - 2020 2020 - 2021 Council 253,936$ 269,526$ 258,247$ Town Manager 476,283 457,774 483,950 Town Clerk 675,096 665,929 621,266 Neighborhoods 337,254 381,318 314,973 Community Relations/Public Info 803,895 911,803 919,775 Finance 944,442 1,007,308 1,050,127 Town Attorney 309,273 350,320 350,320 Information Systems 2,538,422 2,856,133 2,987,681 Human Resources 721,853 793,119 795,212 Utilities and Operating Expenses 3,928,741 4,819,910 5,056,706 Solid Waste Collections 3,698,192 3,536,960 3,779,487 Planning and Zoning 1,786,894 2,011,645 1,881,735 Police 23,090,457 24,461,660 24,643,761 Code Compliance 480,097 729,538 764,950 Engineering 1,472,854 1,508,464 1,553,267 Public Works 3,883,742 4,111,435 4,352,148 Parks Maintenance 2,207,869 2,467,606 2,421,188 Recreation Services 2,679,761 3,097,286 3,244,396 Business Development 120,629 173,777 112,002 One-Time Trf to CIP - 1,000,000 -

TOTAL EXPENDITURES 50,409,690$ 55,611,511$ 55,591,191$

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Water Fund:Highlights:

• The Water Utility will experience a net increase in water revenues of 6.75%, made up of a 1% increase in customer growth,

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no indexing and an anticipated increase in demand.

• One additional new position .

• Projected to meet R&R funding Target of $6.8 million.

Actual Adopted ProposedFY 2019 FY 2020 FY 2021

REVENUESCharges for services 27,230,802$ 25,007,979$ 26,941,462$ Interest 799,418 562,808 405,452Miscellaneous 396,041 383,600 388,600Designated from retained earnings - 143,261 -

TOTAL REVENUES 28,426,261$ 26,097,648$ 27,735,514$

EXPENSESAdministration 2,744,720$ 3,229,860$ 3,010,801$ Plant 7,932,482 9,159,263 9,789,494Field 2,410,153 2,590,015 2,833,136Cost Allocation - General Fund 881,506 1,191,126 1,259,560Depreciation 6,526,238 6,764,000 6,828,000Debt service 2,869,131 2,663,384 2,704,591Contingency - 500,000 500,000Designated to retained earnings 5,062,031 - 809,932

TOTAL EXPENSES 28,426,261$ 26,097,648$ 27,735,514$

FUNDS AVAILABLE FOR R&R (excluding retained earnings)

Revenue 28,426,261$ 25,954,387$ 27,735,514$ Less: Total expenses (23,364,229) (26,097,648) (26,925,582)Plus: Depreciation 6,526,238 6,764,000 6,828,000

AVAILABLE FOR R&R 11,588,269$ 6,620,739$ 7,637,932$ (R&R target is $6.8M in FY2021)

Stormwater Fund:Highlights:

• 7.0% increase in stormwater fees which was adopted by the Town Council on August 18th.

• A 1% growth factor in ERU’s served.

• Static budget compared to FY2020, will meet target of $656K for R&R funding.

Actual Adopted ProposedFY 2019 FY 2020 FY 2021

REVENUES Charges for services 3,012,458$ 3,265,082$ 3,453,784$ Interest & miscellaneous 54,418 22,289 6,210 Designated from retained earnings - 231,667 107,394

TOTAL REVENUES 3,066,876$ 3,519,038$ 3,567,388$

EXPENSESAdministration 470,423$ 645,523$ 634,736$ Field 886,628 1,272,467 1,295,830Cost Allocation - General Fund 115,491 179,425 181,341Depreciation 848,265 867,000 870,000Debt service - 454,623 485,481Contingency - 100,000 100,000Designated to retained earnings 746,070 - -

TOTAL EXPENSES 3,066,876$ 3,519,038$ 3,567,388$

FUNDS AVAILABLE FOR R&R (excluding retained earnings)

Revenue 3,066,876$ 3,287,371$ 3,459,994$ Less: Expenses (2,320,806) (3,519,038) (3,567,388)Plus: Depreciation 848,265 867,000 870,000

AVAILABLE FOR R&R 1,594,335$ 635,333$ 762,606$ (R&R target is $656k in FY2021)

Notes:Capitalized Salaries 12,650$ 7,200$ 19,900$

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Building Fund:Actual Adopted Proposed

REVENUES: 2018 - 2019 2019 - 2020 2020 - 2021

Building permits 5,348,698 4,012,000 4,012,000 Interest on investments 299,692 215,000 107,500 Misc. Revenue 6,943 1,000 1,000 Designated from retained earnings - 112,214 251,605

TOTAL REVENUES 5,655,333 4,340,214 4,372,105

EXPENSES:

Protective inspections 3,556,806 3,756,025 3,812,184 Cost Allocation - General Fund 470,990 506,189 478,921 Depreciation 79,404 78,000 81,000 Transfer to CIP 3,445,377 - -

TOTAL EXPENSES 7,552,578 4,340,214 4,372,105

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Revenue – • Permit revenue estimate for FY21

remains static. Too early to tell how COVID - 19 will affect construction permitting at this time. Still an optimistic approach.

• Small Use of Fund balance.

Expenses – • 4% Salary increase.

• Department expenses only increased slightly over FY2020.

Insurance Fund:

Highlights:

• 5 % Increase in Premiums

• Continue 80/20 split in cost between the Town and Employees

• H.S.A . Contributions for Employees $804,000

OPERATING REVENUES

GENERAL FUND - EMPLOYER CONTRIBUTIONS 4,822,816GENERAL FUND - EMPLOYEE CONTRIBUTIONS 1,141,388CRA FUND - EMPLOYER CONTRIBUTIONS -CRA FUND - EMPLOYEE CONTRIBUTIONS -WATER FUND - EMPLOYER CONTRIBUTIONS 1,099,170WATER FUND - EMPLOYEE CONTRIBUTIONS 254,210STORMWATER FUND - EMPLOYER CONTRIBUTIONS 156,582STORMWATER FUND - EMPLOYEE CONTRIBUTIONS 36,249BUILDING FUND - EMPLOYER CONTRIBUTIONS 505,993BUILDING FUND - EMPLOYEE CONTRIBUTIONS 115,622RETIREE CONTRIBUTIONS** 135,084

TOTAL REVENUE 8,267,113

EXPENDITURES

CONTRACTUAL SERVICES 321,545DENTAL INSURNACE 274,777VISION INSURANCE 31,704STOP LOSS PREMIUMS 653,375HEALTH INSURNACE CLAIMS 4,186,748OPT OUT 79,200H.S.A. CONTRIBUTIONS 804,000LIFE, AD&D, LTD, EAP 199,715RESERVE EQUITY 1,716,050

TOTAL EXPENDITURES 8,267,114

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CIP - Total Cost and Funding Summary

2020 – 2024

2021 2022 2023 2024 2025 Total

Engineering 4,981,000$ 10,963,939$ 2,480,000$ 2,100,000$ 1,100,000$ 21,624,939$

Parks 1,125,000 5,378,500 2,831,500 200,000 200,000 9,735,000

Neighborhoods 310,000 310,000 310,000 310,000 310,000 1,550,000

General Government 504,838 520,718 529,132 537,714 546,469 2,638,871

Planning and Zoning 290,000 - - - - 290,000

Water 7,413,837 6,229,826 4,876,676 5,313,558 5,698,322 29,532,219

Stormwater 1,484,693 2,214,660 1,741,602 1,437,251 1,488,900 8,367,106

TOTAL 16,109,368$ 25,617,643$ 12,768,910$ 9,898,523$ 9,343,691$ 73,738,135$

Project Funding 2021 2022 2023 2024 2025 TotalGeneral Revenues 4,176,258$ 3,313,218$ 2,709,132$ 1,837,714$ 1,846,469$ 13,882,791$ Surtax Proceeds 350,000 6,823,103 2,631,500 - - 9,804,603Grants : LRPI - 294,500 350,000 200,000 200,000 1,044,500 LRD - 140,000 - - - 140,000 FDEP State Grant - 280,000 - - - 280,000 FDOT 200,000 4,655,000 150,000 - - 5,005,000 CDBG 310,000 310,000 310,000 310,000 310,000 1,550,000 TPA - - - 1,000,000 - 1,000,000 FHWA/MPO - 1,626,836 - - - 1,626,836 LRD Contribution 20,000 - - - - 20,000Escrow & Other Deposits 273,580 - 81,000 - - 354,580Road Impact Fees 1,881,000 45,000 269,000 - - 2,195,000Water R&R 6,368,424 6,171,701 4,916,896 5,255,433 5,640,197 28,352,651Offsite Fees 820,413 58,125 58,125 58,125 58,125 1,052,913Water Capacity Charges 25,000 - - - - 25,000Stormwater R & R 1,541,626 1,352,802 1,141,477 1,080,918 1,127,877 6,244,700CRA Revenue - 400,000 - - - 400,000Stormwater Revenues 143,067 147,358 151,780 156,333 161,023 759,561

TOTAL 16,109,368$ 25,617,643$ 12,768,910$ 9,898,523$ 9,343,691$ 73,738,135$

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Summary• Staff seeks approval on first reading of the proposed millage rate of 2.4633 through ordinance 17 - 20

• Staff seeks approval on first reading of the proposed community investment program through ordinance 18-20

• Discussion and questions regarding the operating budget. Resolution 17 - 20 will be voted on at the second public hearing scheduled for September 22, 2020

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