The City of Coral Gables found sufficient ways to find money in the budget to deal with the serious economic challenges local governments are facing as a result of COVID-19. Avoiding employee salary cuts, raising taxes or dipping into city reserve funds, the city has found ways to cover for millions of dollars in shortfalls.
For FY2020, the potential shortfall is expected to be $9.5M. The city has frozen hiring full time and part time positions ($3.3M savings). Operating accounts frozen and surplus ($3.8M savings), and capital project deferments ($2.4M savings).
For FY 2021, the city expects an $11.2M budget shortfall. The city is applying hard and soft reductions to the budget. Hard reductions means they will eliminate items from the budget to balance expenses to meet projected revenue. Soft reductions means they will further identify items to cut, but will remain funded in a holding code until sufficient revenue activity is confirmed.
The city is doing all it can to avoid employee salary cuts, raising taxes or dipping into city reserve funds. In addition, the city is not contemplating raising the tax millage rate. However, the city administration is expecting a dip in property values both commercial and residential affecting ad-valorem revenues.
Residents are not expected to feel any change in services despite the budget being leaner by millions. City Manager Peter Iglesias immediately froze hiring for vacant positions within the city which totaled well over $1,000,000. However, most of those positions had been vacant for years. The finance department provided the commission with the costs of personnel and benefits, revealing an astonishing 69.1% of the city’s operating budget. One commissioner was caught on open mic saying ‘whoa’.
Coral Gables has the second lowest millage rate in Miami-Dade County among full-service cities. Only the Village of Key Biscayne has a lower millage rate.
The public hearings for the city’s budget will take place in September.