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Home My WebLink About8-19-26 Budget Workshop Adopted MinutesMINUTES Budget Workshop Meeting Wednesday, August 19, 2026 - 6:00 PM a City Hall, Commission Chamber 800 Seminole Road, FL 32233 ATTENDANCE: Present: Curtis Ford, Mayor - Seat 1 (At Large) Bruce Bole, Commissioner - Mayor Pro Tem Seat 2 (District 1308) Candace Kelly, Commissioner - Seat 4 (District 1306) Jessica Ring, Commissioner - Seat 5 (District 1312) Absent: Thomas Grant, Commissioner - Seat 3 (District 1307) Also Present: Kevin Hogencamp, City Manager (CM) Ladayija Nichols, Deputy City Clerk (DCC) Bob Blanco, Human Resources Director (HRD) CALL TO ORDER Mayor Ford called the meeting to order at 6:03 PM. 1. PUBLIC COMMENT None. 2. STAFF PRESENTATION CM Hogencamp presented the item as detailed in the agenda packet, along with a handout and slideshow, which are attached hereto and made part of this official record as Attachments A and B. 8-19-26 Attachment A 8-19-26 Attachment B 3. COMMISSION DISCUSSION Discussion ensued, and the Commission requested the following: • Provide the payment schedule and interest rate information for the Selva Preserve debt. • Report on the City's available line of credit and current drawdown status. • Provide the total cost of department -head -level positions, including all funding sources. • Publish detailed line -item budget information for all departments, including General Government Support and Finance. • Confirm the amounts budgeted and spent during the current fiscal year for Fletcher High School Band and Mayport Middle School grants prior to the next meeting. Mayor Ford took a brief recess from 7:15 PM to 7:20 PM. Budget Workshop August 19, 2026 Attest: ADJOURNMENT The meeting adjourned at 7:32 PM. Ladayija Nichols, Deputy City Clerk Date Approved: 0� ! Z-4 "isrd, May r Budget Workshop August 19, 2026 I EXECUTIVE SUMMARY & STRATEGIC DIRECTION The Proposed Fiscal Year 2026-27 Municipal Budget for the City of Atlantic Beach establishes a balanced, financially sound operational and capital framework. Operating under a maintained millage rate of 2.7499 mills — among Florida's lowest municipal rates for full-service cities — this budget proactively addresses impending structural revenue shifts while maintaining exceptional municipal services. External Economic Headwinds • Sunsetting Revenue Sources: Expiration of the Better Jacksonville Plan sales tax revenue framework. • Legislative Homestead Pressures: Expanding state homestead exemption proposals, with modeled municipal revenue reductions of–$1.08M in FY 2027-28 and–$1.80M in FY 2028-29. • Cost Drivers & Interlocal Agreements: Persistent inflationary forces paired with evolving interlocal service cost- sharing dynamics with Duval County. I STRATEGIC INITIATIVES & OPERATIONAL ACHIEVEMENTS FY 2025-26 Operational Wins FY 2026-27 Key Priorities • Environmental & Infrastructure: Enacted landmark • Resiliency & Infrastructure: Execute tree protection code; completed Aquatic -Hopkins Stormwater Master Plan update with geological infrastructure; converted water/sewer disinfection from surveys; prioritize public ROW drainage; gas chlorination to safer alternatives; launched Phase 2 establish routine ditch maintenance; launch North Sherry Drive water main extension, permeable block incentives. • Technology & Analytics: Deployed enterprise ERP software, Open AB public transparency portal, AB Trees canopy tracking, and modern asset management systems. • Community & Culture: Completed Marsh Oaks Community Center & garden; hosted Centennial events and Turtle Crawl; established Farmer's Market & ABAA partnerships; revitalized Veterans Memorial Park. I FY 2026-27 BUDGET ADOPTION TIMELINE • Environmental Stewardship: Enact Old - Growth Champion Tree Protection Ordinance; perform marsh shoreline restoration; maintain dunes via sea oat planting. • Public Safety & Mobility: Modernize Town Center lighting; build Sherry Drive traffic calming; update E -Bike Ordinance 2.0. • Community Spaces: Update Parks Master Plan; complete Donner Park splash pad & baseball upgrades; launch full Marsh Oaks operations. TMay 2026: Departmental Request Reviews Conducted by City Management City of Atlantic Beach — FY 2026-27 Proposed Budget Page 1 of 6 Attachment A to 8-19-26 Minutes June 2026: Public and Commission Input Solicited June 29, 2026: First Budget Workshop July 20, 2026: Second Budget Workshop and Strategy Publication August 4, 2026: TRIM Notice Submitted (Millage Capped at Current Rate) August 19, 2026: Third Budget Workshop and Fiscal Strategy Submission August 24, 2026: City Commission Budget Discussion September 3, 2026: Revised Proposed Budget Submission September 9, 2026: Final Proposed Budget Submission September 14, 2026: First Formal Public Budget Hearing September 28, 2026: Final Budget Hearing and Official Tax Rate Adoption WORKFORCE RESTRUCTURING & INTERNAL COST CONTAINMENT • Net Position Reductions: Achieves a net reduction of 2 FTE positions in FY 2026-27 by eliminating the FIR Deputy Director, Wastewater Plant Operator, and Building Maintenance roles (-$240,000 + benefits in savings), offset by adding a Communications Specialist (-$60,000), A multi-year target envisions reducing at least 4 additional FTEs through attrition by FY 2028-29 (-$450,000 + benefits). • Compensation Moderation ("Greater Of" Formula): Implements the lowest net wage growth rate in a decade. Increases the base minimum wage floor from $16.83/hr ($35,006.40/yr) to $18.00/hr ($37,440/yr) via a fixed $2,433.60 annual boost. Staff earning under $121,680 receive a fixed $2,433.60 raise (2.43% to 6.95% increase), while staff above $121,680 are capped at a 2.0% increase. • Digital Workflow Optimization: Fully deploys BS&A Software and a -Plan Site Plan Review software to streamline municipal permitting, planning, and administrative operations. • Targeted Special Fund Alignment: Directs enterprise sources (e.g., Paid Parking Fund, Tree Protection Fund) to absorb cost -recovery items, Beaches Town Center enhancements, and canopy preservation. • Leave Liability Mitigation: Restructures compensated absence policies and PTO bank cash -out limits to curb long- term leave liabilities. TAX CONTEXT & PROPERTY OWNER VALUE ANALYSIS Taxing Authority Breakdown based on a Median Homesteaded Assessed Value of $582,320: Consolidated City of Jacksonville 7.9012 $3,161.32 44.9% Duval County School Board 6.2550 $2,668.32 37.9% City of Atlantic Beach $1,100.45 15.6% St. Johns River Water Management District 0.1793 $89.65 1.3% Florida Inland Navigation District 0.0270 $13.50 0.2% Total Combined Taxing Authorities 17.1124 $7,033.24 100.0% City of Atlantic Beach — FY 2026-27 Proposed Budget Page 2 of 6 Attachment A to B-19-26 Minutes Real -World Cost Reference: the City's annual property tax assessment of $1,100.45 on a median -assessed home equals roughly $91.70 per month — comparable to the cost of a standard single- or multi -line monthly mobile phone plan. I REVENUE ARCHITECTURE & SENSITIVITY SCENARIOS Ad Valorem Revenue Breakdown (Baseline Revenue: $9,094,896) • Homesteaded Properties: $4,929,434 (54.2%) • Non -Homesteaded Properties: $4,165,462 (45.8%) • Organic Valuation Growth: Yields —$633,506 in incremental revenue under the current millage rate. Homestead Exemption Expansion Sensitivity Modeling SCENARIOEXEMPTION ESTIMATED REVENUE IMPACT GENERAL FUND (GF) IMPACT Current Homestead Revenue Baseline $4,929,434 Baseline (100%) $150,000 Exemption Scenario -$1,060,000 -4.9% GF $250,000 Exemption Scenario -$1,840,000 -8.5% GF Full Exemption Repeal Scenario -$4,929,434 -21.2% GF Note: Replacing a total loss of homestead revenue would require a 1.4904 mill increase, raising the municipal tax rate from 2.7499 to 4.2403 mills. Y COMPREHENSIVE BUDGET SUMMARY BY FUND General Fund (001) $21,956,756 $21,820,934 -$135,822 -1.15% Water Enterprise Fund $11,808,183 $9,679,128 -$2,129,055 -18.03% Sewer Enterprise Fund $14,009,111 $11,131,888 -$2,877,223 -20.54% Stormwater Utility Fund $3,235,030 $3,340,215 +$105,185 +3.25% Sanitation Fund $2,637,572 $2,680,828 +$43,256 +1.64% Building Code Fund $758,451 $752,598 -$5,853 -0.77% Other Funds i Reserves $3,210,931 $7,544,409 +$4,333,478 +42.56% Total Municipal Budget $57,616,034 $56,950,000 -$666,034 -L16% I GENERAL FUND DETAILED LINE -ITEM ALLOCATIONS Total General Fund: $21,820,934 City of Atlantic Beach — FY 2026-27 Proposed Budget Page 3 of 6 Attachment A to 8-19-26 Minutes Revenue Structure Expenditure Allocations Ad Valorem Taxes 39.9% Public Safety 39.3% Intergovernmental 19.0% General Government 30.6% Internal Service Charges 9.4% Public Works 15.69A Sales and Use Taxes 7.0% Parks and Recreation 11.8% Fund Balance Reserve 6.0% Transfers Out 2.0% Licenses and Permits 5.1% Human Services 0.7% Transfers In 4.8% $1,068,726 Human Resources Charges for Services 3.7% Information Technology $988,700 Local Option Gas Tax 3.6% Misc / Fines / Other 1.8`16 $1,691,985 Police - Patrol Division Departmental Line -Item Breakdown GENERAL GOVERNMENT City Commission $92,706 $92,421 City Manager $659,903 $655,826 Finance Department $1,543,194 $1,615,101 Legal Services $173,644 $182,326 Planning and Zoning $506,481 $566,836 Code Enforcement $134,800 $134,907 City Clerk $431,325 $451,236 General Government Support $1,026,283 $1,068,726 Human Resources $451,074 $385,668 Information Technology $988,700 $988,700 PUBLIC SAFETY Police - Administration $1,545,172 $1,691,985 Police - Patrol Division $4,453,785 $5,035,831 Police - Detective Division $493,117 $521,301 Police - Dispatch Services $563,106 $592,761 Police - Animal Control $138,618 $145,245 Police - School Crossing Guards $35,473 $49,213 Police - Crime Suppression Unit $19,251 $24,296 Fire Control and Rescue Services $1,019,866 $781,500 Ocean Rescue / Lifeguards $468,165 $482,477 PUBLIC WORKS & INFRASTRUCTURE Public Works - Administration $760,539 $522,253 City of Atlantic Beach - FY 2026-27 Proposed Budget Page 4 of 6 Public Works - Streets and Stormwater Public Works - Building Maintenance Public Works - Fleet and Equipment PARKS & RECREAI ION Parks Maintenance - Operations Parks Maintenance - Landscaping Recreation Division Total General Fund Expenditures Attachment A to 8-19-26 Minutes $2,292,345 $1,561,598 $663,043 $698,983 $456,690 $457,990 $2,131,721 $2,199,387 $279,969 $243,487 $627,786 $670,878 $21,956,756 $21,820,934 FINANCIAL BENCHMARKS & STRATEGIC RESERVES City governance mandates maintaining an unassigned General Fund reserve between 25% (3 months) and 50% (6 months) of total operating expenditures. General Fund Reserve $10,000,000 $10,000,000 –46% expenditure coverage (within policy limits) Sewer Enterprise $2,499,924 $2,550,000 Lift station resilience and treatment capital upgrades Reserve Water Enterprise Water quality, treatment plant maintenance, system $1,865,705 $1,920,000 Reserve securi ty Capital Projects Fund $1,002,760 $1,050,000 Citywide multi-year capital improvements Tree canopy expansion and champion tree Tree Protection Fund $617,495 $650,000 stewardship Better Jacksonville Legacy capital allocations (sunsetting sales tax Fund $484,994 $350,000 source) Paid Parking Reserve $330,573 $360,000 Town Center access, lighting, and mobility upgrades Interlocal Alignment & Revenue Offsets • COJ Interlocal Agreement: Retained Civic Consulting Group to evaluate service equity regarding the 3.2907 millage differential deducted by Jacksonville under the 1982/1996 framework. • FirefRescue Contract Savings: A 2 -year agreement reduced Atlantic Beach's contribution from $1.51M to $750,000. These non-recurring savings ($750,000) are directed entirely to capital reserves. • Alternative Revenue Modeling: Evaluating property -based Fire/EMS assessment fees, streetlight assessment districts, expanded paid parking, and special roadway maintenance assessments. City of Atlantic Beach — FY 2026-27 Proposed Budget Page 5 of 6 Attachment A to 8-19-26 Minutes EXTERNAL FUNDING & CAPITAL PROGRAM Grant and Appropriation -Funded Projects TIER 2 (50,'0-9%) Minor Contraction DESCRIPTIONPROJFCT • • 32 -hr flex work schedules • Draw down stabilization reserves Lift Station Vulnerability Retrofits $1,400,000 50% Match Beach Walkovers (1st, 4th, 5th, 11th, 13th, 15th Sts.) $1,080,000 0% Match Aquatic Gardens Drainage and Ditch Widening $1,000,000 0% Match Stanley Road Area Stonn Sewer System $650,000 10% Match Stormwater Master Plan Comprehensive Update $400,000 25% Match Aquatic Gardens - Cutlass Drive Culvert $400,000 10% Match Marsh Oaks Septic -to -Sewer Transition (Phase 1) $375,000 0% Match Dora Drive Stormwater Retention Pond (Design/Build) $250,000 -5% Match 5th Street Beach Walkover Project $140,000 $80,000 Match Sherman Creek Dredging (Howell Park to 11th St.) $60,000 0% Match Unfunded Operational Requests • Complete Streets Projects: Sailfish Drive, Seminole Road, Dutton Island Road. • Community Grants: Non-profit community organizational grants. • Infrastructure & Facilities: 16th Street beach walkover construction; Russell Park racquetball court rehabilitation. • Fleet Expansion: 2 requested police patrol cars, 2 requested service trucks. AMENDMENT 3: MULTI -TIERED ADAPTATION ROADMAP & PRIORITIES iILR 1 (10io-1 TIER 2 (50,'0-9%) Minor Contraction Moderate Contraction • Selective hiring holds • 32 -hr flex work schedules • Draw down stabilization reserves Travel and training freeze • Re -bid external contracts • Defer non -vital capital projects • Grant shift for capital Items • Pause non -urgent maintenance • Expanded seasonal staffing model Priority -Based Budgeting (PBB) Hierarchy • Tier 1(Core Mandates): Police, Fire, Ocean Rescue, drinking water compliance, wastewater operations, emergency preparedness. • Tier 2 (Essential Support): Stormwater maintenance, core facilities, administrative operations, legal compliance. • Tier 3 (Quality of Life): Recreational programs, community events, aesthetic landscaping, discretionary upgrades. City of Atlantic Beach — FY 2026-27 Proposed Budget Page 6 of 6 W,ITY OF ATLANTIC BEACH, FLORIDA Proposed FY 2026-27 Budget Comprehensive Fiscal Sustainability Strategy & Operational Roadmap WORKSHOP DATE MILLAGE RATE TOTAL BUDGET August 19, 2026 2.7499 Mills $56,950,000 Attachment B to 8-19-26 Minutes Executive Summary Sustaining high-quality public amenities & essential services. FY 2026-27 BUDGET OVERVIEW IV Low Tax Rate Stability Maintains millage rate at 2.7499 mills — among Florida's lowest municipal rates for full-service cities. t-_1 Revenue Proactivity Proactively addresses structural revenue shifts including sunsetting Better Jacksonville Plan sales taxes. AL Legislative Preparedness Prepares for state homestead exemption expansions (-$1.08M drop in FY 27-28; -$1.8M drop in FY 28- 29). Attachment B to 8-19-26 Minutes FY 2026-27 Adoption Timeline [n May—lune 2026 Departmental reviews & public/commission input solicited. Q� June 29 / July 20 First & Second Budget Workshops held. QAugust 4 / 19 TRIM notice submitted & 3rd Budget Workshop. ,A, Sept 3 / 9 / 14 Revised & final proposals; 1st formal public hearing. OSept 28, 2026 Final Budget Hearing & official tax rate adoption. KEY LEGISLATIVE MILESTONES Attachment B to 8-19-26 Minutes Strategic Priorities & Wins 1p FY 2025-26 Wins Enacted tree protection code & converted plant disinfection to safer alternatives. I" Deployed Enterprise ERP, Open AB portal, and AB Trees canopy tracking. ACCOMPLISHMENTS & OUTLOOK Q FY 2026-27 Priorities Update Stormwater Master Plan & prioritize public right-of-way drainage. Enact Old -Growth Champion Tree Ordinance & sea oat dune restoration. Completed Marsh Oaks Community Center & activated Veterans Memorial Park. � Modernize Town Center lighting, Sherry Dr traffic calming, and LPR deployment. Attachment B to 8-19-26 Minutes Workforce & Cost Containment M Net Position Reductions Net reduction of 2 FTEs in FY 2026-27 (—$240k savings + benefits), targeting 4 additional attrition FTE reductions by FY 2028-29 (—$450k savings). ® Compensation Moderation Lowest wage growth rate in a decade using "Greater Of' formula. Base minimum wage raised to $18.00/hr ($37,440/yr). Staff above $121,680 capped at a 2.0% raise. OPERATIONAL EFFICIENCY MEASURES IM Digital Optimization Enterprise ERP & e -Plan deployment; shifting cost -recovery items to Paid Parking & Tree Protection Special Funds. Attachment B to 8-19-26 Minutes Property Tax Context MILLAGE RATE COMPARISON Consolidated City of Jacksonville 7.9012 $3,161.32 44.9% Duval County School Board 6.2550 $2,668.32 37.9% City of Atlantic Beach 2.7499 $1,100.45 15.6% St. Johns River Water Management District 0.1793 $89.65 1.3% Florida Inland Navigation District 0.0270 $13.50 0.2% Total Combined Taxing Authorities 17.1124 $7,033.24 100.0% 0 Real -World Value Comparison: Atlantic Beach's municipal tax of $1,100.45/yr equates to $91.70/month — equivalent to a standard monthly mobile phone plan. Attachment B to 8-19-26 Minutes Comprehensive Budget Summary General Fund (001) $21,956,756 $21,820,934 Water Enterprise Fund $11,808,183 $9,679,128 Sewer Enterprise Fund $14,009,111 $11,131,888 Stormwater Utility Fund $3,235,030 $3,340,215 Sanitation Fund $2,637,572 $2,680,828 Building Code & Other Funds $3,969,382 $8,297,007 Total Municipal Budget $57,616,034 $56,950,000 ALL FUNDS COMPARISON -$135,822 -1.15% -$2,129,055 -18.03% -$2,877,223 -20.54% +$105,185 +3.25% +543,256 +1.64% +$4,327,625 +109.0% -$666,034 -1.16% Attachment B to 8-19-26 Minutes General Fund Breakdown ($21.82M) Public Safety General Government $21.82M Public Works Parks & Recreation EXPENDITURE DISTRIBUTION 39.3% ($8.57M) 30.6% ($6.68M) 15.6% ($3.40M) 11.8% ($2.57M) Transfers & Human Services 2.7% ($0.59M) Attachment B to 8-19-26 Minutes Reserves General Fund Reserve — $10,000,000 — $10,000,000 Sewer Enterprise Reserve $2,499,924 $2,550,000 Water Enterprise Reserve $1,865,705 $1,920,000 Capital Projects Reserve $1,002,760 $1,050,000 Tree Protection & Parking Reserves $948,068 $1,010,000 CAPITAL PROTECTION —46% expenditure coverage (policy: 25%-50%) Lift station resilience & treatment upgrades Water quality & plant security Citywide multi-year capital improvements Canopy stewardship & Town Center/Complete Streets upgrades Attachment B to 8-19-26 Minutes Grant & Capital Program EXTERNAL FUNDING & MATCHING Lift Station Vulnerability Retrofits $1,400,000 50% Match Beach Walkovers (1st, 4th, 5th, 11th, 13th, 15th) $1,080,000 0% Match Aquatic Gardens Drainage & Ditch Widening $1,000,000 0% Match Stanley Road Area Storm Sewer System $650,000 10% Match Stormwater Master Plan Comprehensive Update $400,000 25% Match Marsh Oaks Septic -to -Sewer Transition $375,000 0% Match Attachment B to 8-19-26 Minutes Revenue & Exemption Modeling HOMESTEAD EXEMPTION IMPACT ANALYSIS $150k Exemption Expansion -$1,060,000 $250k Exemption Expansion -$1,840,000 -4.9% -8.5% Full Exemption Repeal Scenario -$4,929,434 -21.2% Attachment B to 8-19-26 Minutes Amendment 3 Revenue Contraction Roadmap Minor Contraction Selective hiring holds ,-' Travel& training freeze Moderate Contraction ,,' 32 -hour flex schedules Re -bid external contracts TIERED MITIGATION STRATEGY of 3(10%4) Severe Contraction Draw stabilization reserves ,,' Defer non -vital capital projects Grant shift for capital items -" Pause non -urgent maintenance %,' Seasonal staffing model