Sebastian adopts tentative 3.4455‑mill rate and tentative FY2026 budget; council cites reserve, emergency risks

The City Council of Sebastian on the first public hearing for the 2025 millage and 2026 budget tentatively adopted a millage rate of 3.4455 mills and a matching tentative budget for fiscal year 2026. Mister Stewart, chief financial officer, announced the proposed rate and said the figure is “14.29% higher than the computed rollback millage.”

The tentative budget covers the fiscal year beginning Oct. 1, 2025, and ending Sept. 30, 2026. The council approved resolution R‑25‑31 setting the tentative millage and R‑25‑32 adopting the tentative budget after public comment and staff presentations.

Why it matters: the millage and budget determine how much property taxpayers will contribute to city services next year and set spending priorities for general, enterprise and special revenue funds. City staff and council members said reserves and potential unreimbursed emergency costs made holding the rate above the rollback necessary.

City staff presented the key drivers of the draft budget. Stewart, the city’s chief financial officer, said health insurance premiums rose about 7 percent and that nonunion employees are included for a 6 percent pay increase in the draft. Personnel costs increased by about $992,000 while operating expenses rose $207,000 and capital spending decreased by about $584,000, leaving a net general fund increase of roughly $614,000, or 3.2 percent, in the draft budget.

Mister Benton, a city staff member, flagged the solid waste fund as a point of interest: "we are actually estimating, to be about $2,021,000 dollars above the amount that that's been paid out," he said, noting the city set that fund up so fee collections from the tax collector are kept separate and not commingled.

Council members who spoke said dipping into reserves to reach the rollback rate would create a larger recurring shortfall. Benton told the council that using reserves to achieve the rollback would require roughly $1,038,827.39 this year and that tapping reserves to cover recurring costs would leave the city roughly $1 million short in the following year, when the city still faces personnel and operating cost pressures.

During public comment, Grama Reed of Sebastian urged the council to consider using reserves and move to the rollback rate, saying: "I just would like to see if we could consider the rollback and why or why not." The council and staff responded by outlining the finance risks and the likely need to replenish reserves the next fiscal year.

Council members also cited other uncertainties. One council member said the city cannot rely on FEMA reimbursements if there are major storms and said that lack of reserve capacity creates risk for responding to disasters and for staffing needs.

Staff presented property value and tax data used to calculate the rollback. Certified taxable value in the city rose by about $193 million, an 8.4 percent increase over the prior year; new additions accounted for about $58 million (2.55 percent) and reassessments about $134 million (5.86 percent), producing a rollback rate of 3.0148 mills. Stewart also provided a direct comparison to last year’s rate, saying the actual percentage increase over last year’s rate is 7.8 percent.

The staff presentation detailed enterprise and special fund items: the golf course is projected to run at a deficit in the draft budget, the airport shows a projected shortfall tied to loan repayments and grant matches, and the ARPA fund contains projects that must be obligated by Dec. 31, 2024 and spent by Dec. 31, 2026. The capital improvement program and grant matching needs also factored into the budget considerations.

Action taken: the council voted to adopt resolution R‑25‑31 (tentative millage 3.4455) and resolution R‑25‑32 (tentative budget for FY2026). Roll call votes were recorded as affirmative by Vice Mayor Jones, Council member Bridal, Council member Nunn and Mayor McPartland for the millage resolution; the budget resolution carried by the same affirmative votes.

Next steps: the council set a second (final) public hearing for Sept. 24, 2025, when it will consider adoption of the final millage and final budget. The city will advertise the proposed millage and the 14.29 percent number required under Florida’s Truth in Millage rules.

Details and caveats: the council’s discussion and the public hearing followed the statutory framework read into the record by the city attorney, citing Florida Statute section 200.065 on method of fixing millage and the order of considering millage and budget. Specific dollar amounts for some enterprise fund projections were discussed in staff slides; where staff reading was unclear in the record, the article reports the totals that were clearly stated by staff or the council.