Oldsmar manager presents lean $53.8M proposed budget; millage held at 4.5 mills

City Manager Felicia Donnelly on Wednesday presented the City of Oldsmar—Y26 proposed operating and capital budget totaling $53,842,890 and recommended holding the ad valorem millage rate at 4.5 mills.

The proposal, described by Donnelly as "more than just numbers in a spreadsheet. It's our roadmap," would reduce overall budgeted spending by about $10 million (15.8 percent) from the current revised year, preserve a required 15 percent general fund unrestricted balance, and keep enterprise funds self-supporting.

Why it matters: The document lays out the city—s near-term spending and capital priorities while preserving reserves and avoiding a tax-rate increase that would affect homeowners; several large capital projects remain contingent on grant awards and future council decisions.

The proposal—s main details - Total proposed budget: $53,842,890 (a 15.8% decrease vs. the revised FY25 budget), with capital outlay of $16,450,500 (30.6% of the total). - Millage rate: proposed to remain at 4.5 mills (no increase). - Personnel: the budget includes a 4% global wage increase effective Oct. 1 and up to a 1% merit increase on anniversary dates. It also anticipates a 11% increase in medical insurance costs and factors firefighter pension contribution changes based on FY25 pensionable wages. The budget does not include any negotiated contract increases from ongoing collective-bargaining with the Oldsmar firefighters or adjustments that may result from a pay-and-classification study expected this year. - Staffing: net reduction of 3.5 full-time equivalents (2.5 FTE in the general fund, 1.0 FTE in the water/sewer fund) through reorganization and vacancy management.

Revenue and one-time proceeds The staff emphasized a mix of recurring revenues and one-time items: taxable property values increased about 3.8% (later revised to 3.95%), and the city reported roughly $2,778,000 in net proceeds from the recent sale of property adjacent to the library. - Allocation of sale proceeds (total approximately $2,778,000): $2,222,500 to the general fund (of which $1,000,000 will be transferred to a Harbor Palms debt service reserve), $382,000 to the Community Redevelopment Agency (CRA), and $145,000 to the capital projects fund. The city manager said the transfers were intended to strengthen reserves and offset future debt service and capital costs rather than to fund ongoing operations.

Rate changes and ordinances - Water and sewer: a 5.5% rate increase is included, corresponding to an earlier ordinance adopted in 2022 that provides annual increases through FY27. - Stormwater: the proposed budget includes a $3 per equivalent residential unit (ERU) increase; council consideration of this change is scheduled for a September public hearing. - Commercial solid-waste fees: staff proposed a first-in-many-years increase for commercial customers, effective Oct. 1, 2025; residential solid-waste service would remain $20 per month.

Major capital projects and timing Several major projects were discussed; staff cautioned that timing and funding availability affect FY26 budgeting. - State Street culvert: budgeted as the largest stormwater capital item (nearly $3 million); state and federal grants are included in the stormwater fund to cover much of the cost and construction is expected to begin in FY26. - St. Pete Drive Complete Streets and roundabout: total project funding is complex (state/federal grants, penny-for-Pinellas, and CRA TIF funds); the project was re-budgeted into FY26 after rebidding. - Douglas Road: the large resurfacing/reconstruction project remains on hold pending additional grant funding and was not included in the FY26 budget. - Water reclamation facility (WRF) control building: construction contract awarded in Aug. 2024 with a total project cost estimated at $7.53 million ($2.15 million state grant; remainder in water/sewer fund); contract completion slated for September 2026. - Reverse osmosis (RO) water treatment plant: noted debt service and ongoing operations; annual debt service for the RO refinancing is about $475,000.

Fund highlights - General fund: proposed just under $21 million (an 8.5% increase reported on certain pages due to transfers and one-time allocations); 53% of the general fund request is for personal services and public safety/parks. - Enterprise funds (water/sewer, stormwater, solid waste): combined account for about 42% of the total budget. The Water/Sewer Operating Fund proposed budget is $13,844,770; operating and capital timing explain a projected revenue decrease versus FY25 because several capital receipts and reimbursements were recognized in the prior year. - Community Redevelopment Agency (CRA): proposed budget $3,190,015 (up 5.3%) including St. Pete Drive components; staff reviewed how CRA tax increment financing (TIF) redistributes ad valorem taxes above the 1996 base year within the CRA boundary per Florida Statutes 163.340.

Personnel, benefits and workforce Human Resources Director Michelle Roy and staff highlighted retention-focused measures: the 4% wage increase, up to 1% merit pay, and a planned pay-and-classification study budgeted at $40,000. The budget assumes employees' medical insurance premium increases will be covered by the city for dependent costs.

Public comments and staff response Resident Tom O'Shea urged the council to increase staffing in Planning & Redevelopment to process post-storm permits and to consider allowing the CRA to sunset so its ad valorem revenues could flow to the general fund for stormwater and other capital work. In his remarks O'Shea said, "If you guys need to hire more people for that department, I think it'd be a good idea." Staff acknowledged the department remains busy with hurricane recovery permitting and explained temporary and permanent staffing adjustments.

Next steps and process Donnelly and Cindy Nanno (director of administrative services) said the FY26 proposed budget will move to public hearings in September; any changes resulting from collective bargaining or the pay study would be brought back to council as separate adjustments. The city emphasized its long-range budget cycle and that contingency and reserve use requires council action.

Ending note Donnelly described the proposed plan as "lean" and "thoughtful," reiterating the city's priorities: maintain infrastructure, support public safety, pursue grants and maintain fiscal stability while avoiding a millage increase.

Sources and exact attributions: direct quotations and attributions are limited to speakers recorded in the meeting transcript: City Manager Felicia Donnelly; Cindy Nanno, Director of Administrative Services; Kristen Garcia, City Clerk; Tatiana Childress, Planning and Redevelopment Director; Jason Schwabe, Fire Chief; Daniel Simpson, Public Works Director; Michelle Roy, Human Resources Director; Chip Potts, Parks and Recreation Director; Susan Hurley, Library Director; and resident Tom O'Shea. All factual statements in this article reflect material presented during the August FY26 proposed budget session and subsequent public-comment exchange; no committee votes adopting the budget were recorded during this meeting.