Fort Lauderdale forecast shows structural general‑fund gap; officials outline millage and utility-rate options

At a Fort Lauderdale Budget Advisory Board meeting, consultant Kyle (Stantec) and city staff presented a 10‑year revenue sufficiency forecast that shows a widening structural gap in the general fund beginning about fiscal 2027 and fund balances potentially exhausted by 2029 under the status‑quo assumptions.

The presentation summarized the major drivers: recent and projected taxable‑value increases that are expected to moderate, large capital projects and one‑time costs rolling into recurring debt service, and growing personnel and benefit costs. "Our overarching goal is fiscal sustainability, ensuring that over the long term that revenues match expenditures," Kyle said as he walked the board through the model and scenarios.

The model incorporates the adopted FY2025 budget and the city’s five‑year capital plan. Major line items called out in the briefing include the FY2025 fire assessment (moved to full cost recovery and identified in the model as $51,400,000), a reported $45,500,000 police headquarters cost overrun whose debt service increases general‑fund debt service by about $3,200,000 starting in FY2026, and planned capital for water, sewer and stormwater that drives utility rate increases.

Why it matters: the diagnostic scenario showed revenues and expenditures roughly balanced in the short term but diverging over several years as recurring costs outpace projected revenue growth. Under the status‑quo assumptions Kyle said the model showed an approximate $38,000,000 structural shortfall in FY2027 in the diagnostic view and that, "we deplete those fund balances not only below our policy targets, but really fundamentally by '29 to 0." The board used the briefing to discuss options—raising property tax rates (millage), cutting spending, or pursuing other revenue changes—and to ask about timing and community messaging.

Major revenue and expenditure details presented - Millage: One illustrative solution in the model was a 0.65‑mill increase in 2027 with smaller additional increases (0.2 mills) in later years (2030 and 2033) to sustain policy‑target fund balances. Staff described that as one feasible path to restore long‑term balance; the model also allows testing alternative timing and magnitudes. - Property valuation: The forecast uses updated taxable‑value inputs (noted as a 7.7% increase in the 2025 taxable value relative to 2024 in the model) and assumes normalization toward longer‑term averages in later years. - Utilities: Stantec recommended multi‑year utility increases tied to planned capital and debt. The presentation showed example near‑term increases for water (9% in FY2026 and FY2027 in the scenario) and notable step increases for sewer and stormwater tied to specific projects and debt issuances. Kyle noted the water forecast includes a large treatment‑plant and related availability payments scheduled in the later 2020s and early 2030s. - Water meter modernization: The city is piloting an advanced metering infrastructure (AMI) rollout (tens of thousands of meters citywide); staff said AMI will let customers see near‑real‑time usage and help detect leaks sooner, and the model includes modest revenue recovery from more accurate metering. - Grants and contracts: The model assumes some grants will expire and local costs will replace them; staff cited the SAFER grant positions that begin converting to city costs (presented as roughly $4.6 million beginning in FY2028 for 28 positions) and other grant‑to‑local transitions. - Community Redevelopment Area (CRA): The modeling assumes the city’s FY2025 CRA transfer (about $10.6 million) continues at a 50% tax‑increment contribution for the next 10 years for certain redevelopment areas; staff reported Broward County has been unsupportive historically of extending its increment but that the city would formally request continuation and would plan conservatively if county participation is not granted.

Board questions and context Board members pressed on timing (why 2027 was shown as a pivot year), sensitivity to higher taxable‑value scenarios, and whether alternatives to a millage increase (larger service‑level reductions, more aggressive fee increases, or bonds for capital) were modeled. Kyle said the model can run those levers and emphasized the practical reality that property‑tax millage is one readily available lever under local control; many other revenue streams are shared or constrained.

Staff next steps and implementation notes City staff said departments will present business plans at upcoming meetings and that the model will be refined as new revenue and CIP decisions are taken. Staff described several contingent items (possible GO bond for infrastructure, timing of AMI deployment, and final project costs and interest rates) that could materially change the recommended approach. The chief and police staff are preparing estimates for a planned build‑out of a municipal holding facility mentioned during questions; staff said funding could come from grants, fund balance or debt rather than current operating dollars.

Direct quotes "Our overarching goal is fiscal sustainability, ensuring that over the long term that revenues match expenditures," Kyle, Stantec consultant, said during the presentation. "If this were to unfold exactly as we've talked about here with no revenue change ... we deplete those fund balances ... by '29 to 0," Kyle said, describing the model's diagnostic run.

Ending The board did not take any policy vote on the millage at this meeting; members asked staff to return updated scenarios (including alternate taxable‑value and timing assumptions) and to prepare outreach materials that could help the public understand potential impacts. Staff said updated slides and the detailed assumptions would be posted on the city budget site and circulated to board members before the next workshop.