Palm Beach eyes keeping property tax rate steady for $137.1M budget

There will be no change to Palm Beach’s property tax rate for the upcoming fiscal year, if a decision made by the Town Council Sept. 8 stands.

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During the first of two state-required public budget hearings at Town Hall, the council voted 4-1 to adopt a proposed tax rate of $2.61 per $1,000 of taxable value. It also approved a tentative $137.1 million operating budget for the fiscal year that begins Oct. 1.

The proposed tax rate is unchanged from the current rate and represents an 8.4% increase over the so-called “rolled-back” rate of $2.41 per $1,000 of taxable value, the town said. The rollback rate is the property tax rate that would generate the same amount of tax revenue as the previous year from existing properties.

If the proposed tax rate is approved on final reading Sept. 17, owners of homesteaded properties in Palm Beach would pay the town about $75 more per $1 million of their taxable value. Non-homesteaded property owners would pay about $238 more per $1 million of taxable value, assuming their taxable value increases by the maximum 10% allowed under state law.

About 17 cents of every property tax dollar paid by Palm Beach property owners goes to the town, with the remainder distributed among Palm Beach County, the Palm Beach County School District and other taxing authorities, according to town documents.

During a budget workshop in July, council members had agreed to hold the tax rate steady for the 2026-27 fiscal year rather than lower it. Officials at the time cited concerns about rising infrastructure costs and the potential impact of a proposed state constitutional amendment that could limit local governments’ ability to collect property taxes. The amendment will go before voters Nov. 3.

If passed, the amendment would not affect the upcoming budget cycle. But several council members had said they wanted to preserve the town’s financial options until voters decide the measure.

“We don’t know what’s going to happen,” Council Member Julie Araskog said at the July workshop. “We could really have a shortfall with this new legislation. For me, if we lose that tax revenue, where are we going to get it?”

Town officials also pointed to the cost of maintaining and improving town infrastructure, including repairing roads, replacing the aging seawall at Midtown Municipal Beach and other coastal projects.

At the Sept. 8 meeting, council member Lew Crampton cast the lone vote against holding the property tax rate steady, arguing the town could afford to lower it.

Crampton said the town has been running annual budget surpluses of roughly $2.5 million to $3 million and has about $100 million in reserves, including $16 million in excess reserves. He endorsed a lower tax rate of $2.53 per every $1,000 of taxable value, a rate presented as an option at the July workshop. Crampton said the lower rate would avoid the $75-per-million tax increase for people with homesteaded properties.

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Property owners can get a homestead exemption if they declare their residence to be their primary home and meet state-approved criteria for ownership.

“I personally feel, in a year when there’s going to be a lot of eyes on the town and on how governments tax their people – it’s a referendum year – that we need to set a positive example,” Crampton said.

Araskog, however, said she favored keeping the tax rate unchanged. That way, she said, the town would have enough financial flexibility to respond to hurricanes, emergencies and ongoing infrastructure and public safety needs.

“While it may sound good to lower it, I think for what the town has been facing in the last year or two, we really need to not use those general funds,” Araskog said.

The proposed general fund budget is $9.8 million higher than the current fiscal year’s budget, a 7.72% increase. Town Manager Kirk Blouin said the increase is largely the result of higher salaries and benefits, contractual costs, capital and vehicle investments, as well as rising health care and pharmaceutical costs.

The budget includes $1.2 million to renovate the police station and South Fire station along with $5.2 million for sanitary sewer-pump systems. The town also plans to add 4.42 full-time equivalent positions, including positions in the police, recreation and public works departments as well as the Planning, Zoning and Building Department.

The second and final budget hearing is scheduled for 5:01 p.m. Sept. 17 at Town Hall.

Jodie Wagner is a journalist at the Palm Beach Daily News, part of the USA TODAY Florida Network. You can reach her at [email protected].

This article originally appeared on Palm Beach Daily News: Palm Beach eyes keeping property tax rate steady for $137.1M budget

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Reporting by Jodie Wagner, Palm Beach Daily News / Palm Beach Daily News

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This story was originally published September 14, 2026 at 7:38 AM.