On April 29, the Town Council set a proposed millage rate for Fiscal Year 2025-2026, which will commence on October 1. This was the first time the Town Council formally considered the budget for the new fiscal year. Adoption of a proposed millage rate is the first step in a multi-phase process entirely guided by the Florida Statutes. It is also the first of three millage rates the Town Council will adopt in that process. Each millage rate will supersede the one before it and only the third is actually utilized by the Indian River County Tax Collector to calculate property taxes for Orchid. It is in September that the Town Council will next consider the budget, first at a tentative budget hearing, and then about a week later at the final budget hearing.
Importantly, the proposed millage is generally viewed as establishing the maximum rate that can be adopted in September. For this reason, it is prudent to set the proposed millage rate at a more elevated level than may be anticipated to be necessary, in order to enjoy flexibility in September, when the rate can be lowered if circumstances are favorable.
Orchid's first budget discussion is annually scheduled very early to accommodate the highly seasonal nature of the Town's population. The current year's financials are a good starting point for next fiscal year's budget, but, with five months remaining, most during hurricane season, many current year revenues and expenses are still to be realized. In addition, updated taxable property values from the Indian River County Property Appraiser and estimated state revenues from the Florida Department of Revenue are not yet available. This means the budget worksheets were based on a variety of assumptions. More reliable revenue and expense figures will be used at the September budget hearings.
Bearing all this in mind, the Town Council adopted a proposed millage rate of 1.0. That is the same millage rate as was effective in Fiscal Year 2023-2024, but it is a bit higher than the 0.7 currently in effect for Fiscal Year 2024-2025 (a difference of $300 on a property with a taxable value of $1 million). The Town Council discussed the importance of giving itself room to consider all relevant information available closer to the start of the new fiscal year, when the rate can be lowered, but can't easily be raised. This was particularly important to the Town Council this budget season, as the Town plans to conduct a dune repair project during the new fiscal year. It is important that the Town has healthy reserves and is financially in a robust position.
The next budget hearings are scheduled for September 11 and 19, in accordance with state law.