Pompano Beach presents FY2026 budget with public‑safety cost increases, proposes $20 fire fee hike

POMPANO BEACH — City staff presented a recommended fiscal year 2026 general fund budget on June 24 that holds the operating millage rate at the FY2025 level while identifying roughly $19.2 million in year‑over‑year general fund expenditure growth driven largely by public safety costs.

The presentation by Josh Waters, the city’s new budget director, noted that total recommended general fund expenditures are $242,500,000 and that combined public safety spending accounts for 56% of the budget. Waters said the largest single component is police at $72,900,000 and that fire and EMS total roughly $58,000,000. "In sum, these budget pressures total $19,700,000," Waters said, summarizing contract and pension obligations that staff say are non‑discretionary.

Waters told commissioners the recommended operating millage remains unchanged from FY2025 and the net aggregate millage rate would decrease by 0.7% year over year. He said the recommended budget relies on year‑over‑year revenue growth totaling about $19,200,000 from all sources and uses approximately $4,500,000 of general fund fund balance for mostly one‑time capital projects.

Why it matters: the budget reflects rising costs for police and fire, a multi‑year compensation change from the Broward Sheriff's Office (BSO) contract and pension increases that push up city obligations. Commissioners raised questions about whether residents, through a fire assessment increase, and the city’s general fund will fully cover those costs.

Key details from the presentation and discussion

- BSO and pension costs: Waters said the budget includes a $6,600,000 increase in the BSO contract for FY2026, of which $4,200,000 reflects the first year of a two‑year implementation of a BSO compensation study. He said the second year is estimated at $4,600,000. Waters also identified a $4,400,000 increase in pension contributions for fire and police and a $3,000,000 increase for negotiated employee compensation adjustments.

- Fire assessment fee: Staff recommended increasing the residential fire assessment from $331 to $351 per unit, a $20 increase, and applying a proportional increase to commercial, industrial and institutional rates. Waters said the change would raise estimated fire assessment revenues to $31,400,000 in FY2026, up $2,400,000 from the prior year, of which roughly $1,800,000 is attributable to the fee increase. Brian Donovan, assistant city manager, explained that Florida law and local practice allow proportional increases without a new cost‑of‑service study but would require a study to change the relative mix between property types.

- Taxable value and millage: Waters said the city’s preliminary FY2026 taxable base is about $23,000,000,000, a $1,900,000,000 increase (about 9.17%). The presentation shows non‑ad valorem revenues account for about 52.6% of general fund revenues and that ad valorem revenues are projected to increase year over year.

- Community Redevelopment Agency (CRA) tax increment finance (TIF) split: Commissioner Fessett asked staff to prepare options to change the city/CRA TIF split, noting the current allocation gives the city 5% of incremental tax revenue and the two CRAs (East and Northwest) retain 95%. Fessett said shifting splits (examples provided: 30/70, 40/60, 50/50) could produce between about $2.8 million and $5.0 million in additional annual revenue to the general fund. "I would like to make a motion that we direct the city manager and city attorney to prepare and bring back for a formal action ... a properly noticed resolution to adjust the tax increment financing allocation," Commissioner Fessett said. City attorney Mr. Berman replied, "This is a workshop. The commission can take no action at the workshop other than indicate its preference for staff to look into certain actions but there's no official action that can be taken today." Commissioners asked staff to return with a detailed fiscal impact analysis and coordination with CRA boards.

- Lauderdale‑by‑the‑Sea contract and overtime concerns: Commissioners raised concerns that the city’s contract to provide fire services to Lauderdale‑by‑the‑Sea has increased overtime costs. One commissioner said overtime rose substantially after the city began that contract and requested a breakdown showing costs billed to Lauderdale‑by‑the‑Sea and any subsidy from Pompano Beach overtime.

- Other cost drivers and next steps: Commissioners asked for more detail on a roughly $1,000,000 increase for electricity and water at city facilities and about vehicle lease financing, which Waters estimated at $1,000,000 in debt service for FY2026. Waters outlined the remaining budget schedule: published recommended budget on July 8, a full‑day workshop on July 14, a July 22 meeting for a preliminary fire assessment resolution, and the legally required TRIM hearings in September to adopt preliminary and final millage rates and the FY26‑30 capital budget.

Ending

Waters closed by saying he looks forward to working with commissioners as the budget is finalized. No formal budget votes were taken at the workshop; commissioners requested additional analyses and asked staff to return with options and fiscal impacts as described above.