Palm Coast council adopts FY2026 budget, approves 4.0893 millage in 4-1 vote

The City of Palm Coast City Council approved a tentative millage rate of 4.0893 mills and adopted the fiscal year 2026 budget during a special budget hearing on Sept. 24, 2025, at the John Netz Community Wing of City Hall. The council voted 4–1 to adopt the millage and later adopted the final budget by unanimous vote.

The vote on the millage followed presentations by Gwen Ragsdale, the city's budget and procurement manager, and extended council discussion about the budget's drivers. Ragsdale told the council the proposed budget includes large capital and utility funds discussed in prior workshops and that the city's proposed water and wastewater capital program accounts for a major portion of the increase. She said there have been no changes to the proposed budget since the first public hearing on Sept. 10.

Why it matters: the millage and budget set the tax rate and spending plan the city will use for the coming fiscal year. Council members and public commenters framed the debate around taxpayer impacts, debt for large water and wastewater projects and targeted employee pay increases.

Council debate focused on the size and drivers of the increase. Ragsdale presented several figures during the hearing: the general fund was identified at $67,601,395; the city's water and wastewater capital fund was presented as $326,000,000 in the proposed 2026 budget compared with an adopted 2025 amount of $83,000,000; and the five-year capital improvement plan was summarized as $471,800,000. One council member said those utility capital bond proceeds explain most of the apparent year-to-year increase, and removing the utility capital fund would substantially reduce the year-over-year change.

Council members pressed staff for details about how bond proceeds will appear in future budgets. City staff explained bond proceeds will appear in fiscal 2026 and unspent funds will be reappropriated in later years as projects are executed; expenditures will be shown in the capital project funds over the 2026'28 expenditure period rather than as repeated operating expenditures.

Councilmember Marcus Gambarro (spelled in the record as Gambarro/Gambaro) urged adoption of the rollback rate of 4.0035 mills and asked for specific cuts to reach that rate; staff estimated the rollback would require roughly $1 million in reductions. Council members and the city manager discussed options raised on the record, including scaling back up to $1.5 million in targeted performance pay, cutting economic development incentives, or other measures. The city manager cautioned that some proposed cuts (for example, changes to the merit/performance program) would be difficult to implement without affecting employee pay fairness and retention.

Public comment at the hearing included repeated calls for the rollback rate. Resident Jeanne Duarte urged council members to "vote from your own knowledge and your own conscience" and said many budget increases she had seen were "excessive and unreasonable." Duarte also expressed concern about wastewater improvements being funded without a public referendum and urged consideration of the rollback rate, citing remarks by Florida Governor Ron DeSantis as context.

Council vote: the council first moved and seconded adopting the millage rate of 4.0893 mills. In the roll call vote Vice Mayor Pontieri, Council Member Miller, Council Member Sullivan and Mayor Norris voted yes; Council Member Gambarro voted no. Later in the meeting the council voted unanimously to adopt the final budget with total appropriations and reserves recorded in the minutes as $696,444,327.

On bond funding and grants: council members asked whether a $5 million state grant would reduce bond sizing. Staff member Carl (identified in the record by first name) explained that several projects referenced for bond justification were part of a second bond series and that the $5 million was not necessarily replacing existing bond proceeds; he said some projects appropriated later were not part of the initial bond and that the only way to reduce bond proceeds would be if projects came in under cost or the city reduced project scope.

Next steps: the city clerk will forward the adopted millage resolution to the property appraiser, tax collector and the Florida Department of Revenue within three days, as required.

This account is drawn from council presentations and the public record at the Sept. 24, 2025 special budget hearing. Quotations and vote tallies are taken from the meeting transcript and roll-call votes as recorded.