Coral Gables unveiled a proposed $308.2 million budget for fiscal 2025–2026 that holds the line on property tax rates for the eleventh year, relying on reserves and capital spending to manage rising costs—and drawing sharp debate among city officials.

The budget keeps the city’s millage rate at 5.559 for the eleventh consecutive year, while tapping $31.2 million in reserves to support one-time expenses and capital projects. The estimate is based on $26 billion in assessed property value, expected to generate $137 million in property tax revenue.

In addition to property taxes, the city plans to fund the budget through a variety of restricted and unrestricted reserve sources. These include $8.6 million from the general capital improvement fund and $10 million from general fund reserves, both accumulated from prior-year surpluses.

Other revenue transfers include $3.4 million from the parking fund to support trolley operations and capital improvements, $4.4 million from the sanitary sewer fund, and $3.6 million to cover new building department positions. Overall, staff forecast $245.6 million in operating expenditures, $52 million in capital spending, and $10.6 million in debt service.

The budget proposes seven new full-time positions in addition to funding for 20 roles previously added to the Building Division. Three of the new positions are conversions from part-time to full-time roles: a procurement contract specialist (converted from two part-time positions), a grants and internal audit coordinator (from one part-time), and an administrative assistant for Greenspace Management (from two part-time roles).

The remaining four new positions address increased demand for services across departments. These include a parking compliance officer, a tree trimmer, a facilities maintenance worker, and a fleet maintenance mechanic. Each role supports the city’s goal of maintaining in-house service capacity rather than outsourcing.

Managing rising debt

Mayor Vince Lago opened a tense exchange over the city’s long-term debt burden, pointing to recent borrowing decisions. He emphasized that Coral Gables carries $99.5 million in principal debt, with a total obligation including interest of $132.8 million (27:31–27:43). He warned against further debt expansion, recalling a $160 million bond proposal previously rejected by the commission and a $20 million issuance approved last year to fund a cost-of-living adjustment (COLA).

“We need to pay down our debts. The faster we pay down our debts, the more money you’re going to have to spend on projects,” Lago said. He argued that the COLA decision limited the city’s fiscal flexibility, stating that funds previously allocated to overpay pension liabilities had been redirected.

Commissioner Melissa Castro pushed back, urging the commission to focus on solutions. “Let’s stop the political theater. Let’s work together. Let’s lower the millage rate. Let’s work together. That’s it. Stop this drama”.

Lago responded sharply, saying, “It’s not drama and it’s not political theater. These are facts”. He called the COLA fiscally irresponsible and claimed it would affect capital projects and the city’s ability to fund essential improvements over the next decade.

Reforming solid waste

Mayor Lago raised another long-running issue: the cost and inefficiency of solid waste management. He said the city needed to confront how green waste is handled and pointed to abuses of the trash pit system. “We have to, as a community, come to terms with what we’re facing,” Lago said.

He described how landscapers from outside the city were dumping debris in Coral Gables and proposed transitioning to a system in which green waste containers would be rolled out from behind homes and mechanically emptied. “Let’s put together a bin that gets picked up in the back of someone’s house immediately, stopping all the illegal dumping that’s happening here in the city”.

Vice Mayor Rhonda Anderson agreed in principle but stressed the operational costs. “We’re going to have to invest in some equipment so that staff rolling out a green waste container can bring it to the truck,” she said. She added that resident cooperation would be necessary to make the plan work.

Lago urged immediate planning. He said the city already had studies showing the cost of disposing green waste at the landfill and noted that these materials could be diverted and repurposed. “We don’t have to use that money to pay debt down. We can use that money for capital improvement projects that are so sorely needed in this community.”

City Manager Peter Iglesias confirmed that the city’s contract with the Miami-Dade County transfer station ends in March 2026 and that now is the time to develop an alternative. “If we’re going to do that and we’re going to take care of the trash issue with a recycling process, then we need to expand 72nd Avenue”. He said staff are actively studying the site and may partner with nearby municipalities to share costs.

Balancing priorities

Despite sharp disagreements over past financial decisions, commissioners largely agreed on the need to plan ahead for critical infrastructure and control long-term costs. The budget workshop offered a first look at those trade-offs: holding the millage rate flat while increasing investment in capital projects, absorbing higher service costs, and maintaining reserves.

City staff said the Strategic Plan is being updated to align with departmental objectives and budget priorities. The final version is expected to be presented alongside the September budget hearings to guide fiscal and operational decision-making in FY2026.

Final decisions on the budget will be made at public hearings on September 10 and September 25, both scheduled after 5 p.m.

The stakes, several commissioners noted, are not just financial. “This is a $312 million business that has to be run in a fashion that doesn’t jeopardize the vitality and viability of this business for the next decade,” Lago said.