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The City of Naples Budget – “A Prudent Approach To Meet Our Needs and Obligations”

The City’s fiscal year begins on October 1, so September is the month when final budget approvals occur. But it is important you know that this process begins at least six months prior to then and is quite exhaustive, transparent and inclusive:

  • City staff carry out internal meetings in the late winter and early spring to formulate budget requests for the coming year
  • City Council holds budget workshops in May and June, and again in August after the summer recess, to hear these requests, ask questions and reach consensus on a final budget recommendation and way to pay for it. All these meetings are open to the public and viewable at
  • The process is completed with two special public meetings in September — held in the evenings to maximize public convenience and access — to vote on the budget and the property tax millage to help pay for it.

As a result of these deliberations, Council voted on September 5 and 20 (by a 5-2 majority – Councilors Blankenship and Hutchison dissenting) to increase City taxes by .02 mills, from 1.15 to 1.17 mills (one mill is one dollar per $1,000 of assessed value, so .02 mills is equivalent to a two cent increase per $1,000 of assessed value). Since some in opposition to this increase distributed misleading information on the purpose and benefits of this modest increase, I want to be clear as to why I believe this budget approval was the right decision for Naples and its residents.

Why this budget is right for Naples

First and most important, the City of Naples has faced inflationary pressures and cost increases in recent years just as each of you and your families have. These have particularly manifested themselves in higher personnel costs. Over the last two years, City Council has made the decision to increase salaries for our employees after two decades of neglect and wage stagnation. This was not just the right thing to do, but necessary to retain and attract talent, particularly with our police, fire, and emergency personnel.

Bringing our employee compensation to more competitive levels comes with a cost. Our personnel services will be up an estimated $7 million, or over 11%, this coming year compared to 2022-23. We also continue to steadily reduce the unfunded liability in our pension funds (a long-time challenge) through a $1.3 annual million contribution over and above that required by actuarial standards.

Second, the millage increase allows the City to maintain a sufficient reserve in our fund balance to deal with changing economic conditions or emergencies. Our reserves had dropped by 20% in the last two years. With the memory of Hurricane Ian still fresh, we want to make sure we have a reasonable level of reserves should another natural disaster strike or the national economy suddenly weaken.

Third, Naples needs to continue to invest in its infrastructure and municipal services if we want to maintain the high quality of life that you, our residents, have come to expect and request…. and which defines our wonderful community. We are engaged in large, long delayed projects like the Gulf Shore Boulevard Beach Outfalls project and the ongoing series of lakes restorations. With inflation, the costs of these and other public infrastructure projects have unfortunately increased.

Some examples of how inflation has impacted Naples City Government

In addition, the cost of basic goods and services to run our city has exploded, with impacts on essentially every aspect of the day-to-day business of running a city government. Here are a few examples:

  • Roadway resurfacing costs have increased from $115,000 to $161,500 per single lane mile in just two years – a 40% increase! This reduces the amount of lane miles we can resurface for every $1 Million of spending from 4.3 to 3.0 single lane miles.
  • The City’s costs for chemicals for its water and wastewater treatment plants skyrocketed by $1 million in new contracts that were signed last September. And now vendors are requesting additional increases for the upcoming budget year. As just one illustration, the cost of Quicklime will increase by an estimated $354,413 for the coming year – an increase of 16%. Separately, water plant lime sludge hauling and removal increased by 83%, or $295,200, in the past year.
  • Solid waste hauling and equipment costs have dramatically escalated. The City is currently evaluating a request for a 39% increase from our third-party service provider for roll-off waste containers and waste compactors, equivalent to over $100,00 in additional cost to the city. Meanwhile, the cost of equipment for the solid waste truck fleet Naples maintains for collections purposes by our own staff has also grown dramatically. A Front Loading Refuse Truck that cost approximately $270,000 in 2018 now costs an estimated $380,00 – a 40% increase!

I could provide many more specific examples but this gives you a flavor for the cost pressures Naples, like local governments everywhere, are experiencing as they try to maintain or even enhance service levels.

Taken together, these factors have led to the need to pass this modest millage increase. The additional revenue will help stabilize the City’s financial operations in the short-term and provide a critical buffer against possible future negative events. The impact on residents, while real, will be minimal. The anticipated millage increase will vary by household but will be on average $20 per $1 Million of assessed value.

A historical perspective on Naples property taxes

Finally, it is useful to keep this action in historical perspective. Over the past twenty years, the city millage – one of the lowest, if not the lowest, of any locality in Florida – has ranged from a low of 1.10 to a high of 1.124. But it has most often been set during this time at 1.18 mills, a level most recently reached after Hurricane Irma in 2017.

Subsequently, the 2017 level of 1.18 was reduced to 1.15 as we enjoyed a strong economy and increase in the taxable value of our properties. This year, after another horrendous storm event, it is prudent to implement another small millage increase for the reasons described above. Good government requires adjusting to conditions and circumstances in a prudent way. I believe we are following that course of action with our 2023-24 budget.

Naples CFO, Gary Young, who has responsibility with City department heads for developing the annual budget, called it “a budget to be proud of.” By this, he meant that the budget contains expenditures that Naples must make to deliver the services residents expect and that the budget reflects the hard decisions around generating the revenue needed to support those expenditures.

I agree with Mr. Young’s assessment. I strongly support this budget and believe it will guide Naples to the right outcomes over the next year and beyond.