Naples adopts 2025–26 budget, sets general millage at 1.23 mills

The Naples City Council unanimously adopted the city’s fiscal year 2025–26 final budget and fixed the city’s general millage rate at 1.23 mills during a special budget public hearing on Monday, Sept. 22. Council members also approved final budgets and millage rates for the East Naples Bay and Moorings Bay special taxing districts.

Finance Director Stefan Massall told the council the hearing’s statutory purpose was to adopt tentative budgets and millage rates and to demonstrate compliance with Florida’s TRIM advertising requirements. "The purpose of today is to adopt those tentative budgets that were previously approved on September 3 and millage rates per Florida statutes," Massall said during his presentation.

The council voted on six resolutions tied to the city budget and the two dependent taxing districts. The council set the city general millage at 1.23 mills (unchanged from the prior year) and reported an aggregate millage of 1.2473 mills that is 5.42% higher than the aggregate rollback rate. Massall said the general-fund rollback rate is 1.1658 mills; the aggregate rollback rate reported on the TRIM forms was 1.1832 mills. Adopting the 1.23 mills instead of the general-fund rollback rate yields an estimated $2,364,656 in additional revenue to the general fund, the presentation said.

Massall summarized major drivers of the increase in the proposed budget: negotiated salary increases and related benefits for fiscal 2026, a net addition to authorized personnel intended to enhance public safety, and ongoing infrastructure work including street repaving. He said personnel services account for roughly 36% of the proposed budget, operating costs about 31% and capital about 33%.

The proposed total city budget shown in the presentation (with changes incorporated) is approximately $241 million, up from about $208.8 million in the 2024–25 adopted budget. Massall said the presentation assumes a 95% collection rate for property taxes (to reflect prepayment discounts allowed under Florida law) and estimated the city will carry about $20 million of unassigned fund balance in the coming fiscal year, with an emergency reserve set at 10% of the adopted operating budget.

The presentation also showed pension-related budgeting choices: the budgeted contribution rates were presented as 40% for police and fire plans and 15% for the general plan, above the actuarial rates Massall cited (29.3%, 19.4% and 11.3% respectively). Massall said that approach represents an additional budgeted contribution of about $2,460,000 to address unfunded liability concerns.

Massall provided examples to illustrate taxpayer impact, noting that a typical single-family property tax bill shows only about 14 cents of every tax dollar going to the city; the remainder is distributed to the school district, Collier County, mosquito control and water-management districts. He also reported the East Naples Bay millage proposed at 0.5 mills with a budget of $406,200 and the Moorings Bay millage proposed at 0.0125 mills with a budget of $116,285.

Council action: The council moved and passed each resolution by unanimous vote, with motions and seconders recorded for each item. For the city general-fund millage resolution, Councilmember Christmann moved and Councilmember Barton seconded; the vote was recorded as yes from Councilmembers Barton, Christmann, Kramer, Peneman, Petronoff, Vice Mayor Hutchison and Mayor Heitman. The council took the same unanimity on the final-budget resolution for the city and on the four actions adopting millage rates and budgets for East Naples Bay and Moorings Bay.

Mayor Heitman thanked staff following the votes and praised the council’s priorities. City staff member Young thanked council and staff for their work in preparing the budget: "I just want to thank you and everybody in the staff for all the hard work over the summer to get us here and ready to kick off a new year," Young said.

The finance department will file proof of TRIM compliance and the hearing advertisement with the state following adoption. With the six budget and millage actions complete, Mayor Heitman adjourned the special hearing.