By Coral Gables Gazette staff

The Coral Gables City Commission will hold its second and final budget hearing on Thursday, September 25, when it is expected to adopt the city’s $313.6 million fiscal 2026 budget and confirm a flat property tax rate for the 12th consecutive year.

The meeting at City Hall, 405 Biltmore Way, concludes a process that began with July workshops and continued through a contentious first hearing on September 12. That session produced a 4–1 vote to tentatively approve the budget and maintain the 5.559 millage rate. Mayor Vince Lago, Vice Mayor Rhonda Anderson, and Commissioners Ariel Fernandez and Richard Lara supported the plan. Commissioner Melissa Castro dissented, pressing for a phased rollback she argued was fiscally prudent and would not require service cuts.

What the final hearing covers

Thursday’s agenda follows the standard budget process. It begins with a staff presentation on revenues, expenditures, and fund balances, followed by a public hearing for residents. The commission will then consider three legislative items: an ordinance levying taxes for the fiscal year beginning October 1, an ordinance adopting the budget of revenues and expenditures, and a resolution adopting the city’s five-year Capital Improvement Program (CIP) for 2026–2030.

While the September 12 vote signaled majority support, commissioners can still amend allocations or revisit specific programs before final adoption.

Recap of the first hearing

The budget has grown by about $5.4 million since July, reflecting higher property values and adjustments to capital priorities. Finance staff noted that new revenue is matched by expenditures, most of them for one-time projects. Allocations include $300,000 for Ponce de Leon streetscape design, $250,000 for audible crosswalks, $200,000 for traffic calming, and $176,000 for sidewalk repairs. One-time transfers from the Building Division and Sanitary Sewer Fund also support the expanded capital program, which now totals $57.1 million.

The budget funds ten new positions—seven full-time and three part-time—across information technology, planning and zoning, public works, and internal audit. Staffing across city departments has increased steadily over the past decade, particularly in police and fire.

Reserves remain strong. The general fund holds $59.4 million, meeting the commission’s 25 percent target. Commissioners repeatedly cited reserves as critical for disaster recovery and bond rating strength. Anderson emphasized that federal reimbursements can lag years after a storm, while Lara called reserves “a reassurance that you can reach into when you need immediate assistance.”

Slowing revenues, rising costs

Though the property tax base continues to grow, the rate of growth has slowed—5 percent this year, compared with 8, 11, and 12 percent in prior years. That shift has created tighter margins, especially as inflation drives up labor and service costs.

Pension obligations remain another pressure point. The budget includes a $7.6 million voluntary contribution to the pension fund, down from $9.5 million last year. The reduction stems partly from the cost-of-living adjustment (COLA) approved for retirees in 2024, which added $1.8 million in annual costs for the next decade. The COLA passed with Castro’s support and Lago’s opposition, and it has become a recurring flashpoint. Finance staff confirmed they had recommended against it.

“Numbers don’t lie. These are facts. You cannot play with people’s retirements,” Lago said earlier this month, noting that the COLA contributed to a slight decline in the pension fund’s ratio—from 75.2 to 74.5 percent.

Political exchanges

The September 12 hearing featured sharp exchanges between Lago and Castro. The mayor replayed video clips of Castro opposing rollbacks in prior years, framing her current proposal as an election-season shift. Castro countered that her phased approach was different—developed with staff input and designed to avoid service cuts.

“I was never in acceptance of lowering the millage rate for those exact reasons,” she said. “But this year, I figured it out. I did. And I came up with a plan that was responsible, prudent, and fully balanced.”

The debate often turned personal. Lago quipped, “Now that we’re done with the Instagram reel for next week, let’s talk about this,” after one of Castro’s rebuttals. Later, he remarked, “I feel like I just lost 50 brain cells.” Castro replied with her own barbs, at one point cutting him off to say, “No, no, I’m talking to (Finance Assistant Director) Paula (Rodriguez), but I appreciate you having an intent to respond.”

What to watch on September 25

The commission appears ready to keep the millage rate flat for another year, a decision with broad support. But final adjustments could still surface—particularly around staffing levels, project funding, or the structure of fees. Some commissioners have raised interest in reviewing the fire fee or exploring solid waste reforms in the months ahead.

The adoption of the five-year Capital Improvement Program also makes Thursday’s hearing significant. Projects such as mobility upgrades, streetscape designs, and infrastructure repairs will be embedded in the city’s long-term roadmap, shaping development and spending priorities beyond 2026.

The meeting begins at 5:01 p.m. in City Hall chambers, with public participation available in person, online, or by phone.