Finance committee to restore previously-forgone city millage; staff say homeowners should see no net tax increase

Beachwood finance staff told the city’s finance and development committee on June 11 that the city should restore 2.4 charter mills it temporarily forgave to support a school-district levy, a change staff said would return the city to its 2023 millage level and is not a new tax increase.

Larry, a city staff member who presented the analysis, said the city gave up “2.4 mills for 3 years” as part of the earlier agreement with the school district and walked members through an Excel look-back showing revenue trends. “We gave up 2.4 mills for 3 years,” he said. He described 2023 as a high-revenue year and said staff used that baseline to estimate lost income tied to the pause in city millage.

Staff presented several concrete figures the committee used to frame the decision. Larry said the city’s revenue in 2023 was about $11,350,000 and estimated the three‑year revenue loss tied to the forgone millage at roughly $5,400,000. Based on his modeling, he said “it’s gonna take us 12.9 years to get our money back,” and under a more optimistic scenario (a sustained 4% growth over 10 years) the payback period could shrink to about 9.7 years.

Committee members pressed staff on whether restoring the city’s millage would raise residents’ bills. The Chair opened that line of questioning and members repeatedly stressed the need to explain the change to the public. “We aren’t asking for it to go up,” the Chair said, summarizing staff’s point that restoring the city millage largely offsets the earlier pause and that the school levy remains in place.

Members also asked about major capital spending and debt that informed the recommendation. Larry said the 2024 capital spend spike (about $21,700,000) included the purchase of a “Temple” property (roughly $8,000,000), sewer projects and the normal road program (about $3,000,000 per year). He noted the city has paid down roughly $15,000,000 in debt since 2018, that a 2015 debt issue carries payments through 2035, and that fire‑station debt is scheduled through 2042. He said the city received reimbursements from sewer work (about $1,400,000 returned this January) and that if interest rates fall the city could consider refinancing some obligations.

Several members framed the restoration as a return to previous policy rather than a unilateral tax increase and urged careful public messaging. A council member said the committee should emphasize the city’s prior decision to forgo millage was a partnership with the schools and that the expectation was to regain it after the temporary period. The group agreed staff should prepare concise, visual material that can be shown at Monday’s full council meeting and used in public outreach; Ben, a staff member, said he would assemble a condensed one‑page FAQ or talking points and coordinate with Larry before the meeting.

The conversation also covered the city’s AAA bond rating. Staff warned that the primary consequence of any downgrade would be higher borrowing costs on future debt; they said the rating gives the city lower interest costs and favorable treatment from rating agencies.

No formal vote on millage restoration took place at the committee meeting. The Chair moved to adjourn after members confirmed next steps; the meeting ended with staff committed to preparing the materials for council and outreach.

The finance and development committee is set to present the millage-restoration proposal and the condensed materials at the upcoming full council meeting on Monday.