PALM COAST — Despite setting a tentative property tax rate higher than the current year, the City Council still hopes to lower the budget for fiscal year 2026-27 to avoid further burdening taxpayers, which could mean cuts to city staff.
The board July 21 adopted a tentative tax rate of 4.23, a 3.42% increase over the current 4.09 tax rate.
Vice Mayor Theresa Pontieri was the sole dissenter.
The 4.23 figure is the maximum tax rate the city can adopt for the upcoming fiscal year. As budget discussions continue in the months ahead, city staff could tighten the budget, allowing the council to adopt a lower tax rate.
That final vote takes place Sept. 23.
Until then, the board will likely call on staff and certain city departments to cut spending for next year, especially with the homestead exemption amendment on the November ballot – a move that could reduce the city’s tax revenue by approximately $9.2 million in 2027 and $15.9 million in 2028.
Keeping current tax rate would require budget cuts in Palm Coast
During their July 21 discussion, several board members shared their hope to ultimately see a tax rate closer to the current year’s. Councilman Charles Gambaro said the 4.23 tentative rate gives the board “decision space” as budget discussions continue through most of September.
The total general fund expenditure for the next year is projected to be $72.2 million, of which $46.5 million would come from the city’s property tax revenue.
If the board decided to keep the current rate of 4.09, it would generate $44.9 million, which would require the city to cut around $1.6 million from the proposed budget.
The board weighed some ideas for potential cost-saving opportunities that could lower the tentative rate.
Mayor, vice mayor want Palm Coast’s 2026 tax rate to remain
The board, like it did on July 14, discussed ideas for cutting the budget.
Pontieri vehemently voiced her intention to vote against a 4.23 tax rate for next fiscal year and reiterated her suggestions to cut spending, especially on code enforcement staff, as well as costs related to the Southern Recreation Center and by adjusting merit pay increases to staff.
She said she could be convinced to adopt the rolled-back rate of 4.14, but “I won’t vote to increase the millage.”
“In an ideal world, we wouldn’t have to cut employees, but this isn’t an ideal world – we don’t have an endless budget,” Pontieri said.
As staff works to bring proposed cost savings over the coming weeks, the vice mayor asked that “we are not just lopping off the bottom half.”
“I actually think there should be more boots on the ground and less butts in seats in City Hall,” she said. “Work charts need to be looked at and made sure that we’re not top-heavy. That’s what has to be done.”
Mayor Mike Norris said the city should maintain public safety, utilities, stormwater and public works “at current levels” as the main priorities, though the board should “go for the 4.09” tax rate.
“And make cuts across the board to get where we need to get, keeping those priorities where they are at,” Norris said. “Because we don’t know what’s going to happen after this election that’s coming up.
“It’s going to hurt worse to cut more jobs next year because of budget constraints,” he added. “I want to hold the line until we are through this election.”
What is on Palm Coast’s budget for fiscal year 2026-27?
The $72.2 million currently proposed for the next fiscal year represents a 6.8% increase over the 2025-26 budget, which had a total expenditure of $67.7 million.
Public safety costs for next year would increase.
The city’s contract with the Flagler Sheriff’s Office would cost approximately $12.1 million – a roughly $971,000 increase over last year. Approximately $1 million more will cover nine new deputies. The county budget would pay for four additional new deputies.
The fire department’s budget would increase from $16.3 million to $17.2 million.
Some of the other main expenditures also include:
In a press release issued after the meeting, City Manager Mike McGlothlin said the budget process “remains a collaborative effort, and we will continue carefully evaluating expenditures, service levels and potential savings as we work toward a responsible budget that meets the needs of our community.”
Setting the maximum rate, the city said, preserves the board’s “flexibility while staff continues evaluating expenditures, service levels and potential savings.”
— Brenno Carillo is a local government reporter covering Flagler County, including Palm Coast and Flagler Beach, for The Daytona Beach News-Journal.
This article originally appeared on The Daytona Beach News-Journal: Officials want cuts as Palm Coast sets increased tentative tax rate
Reporting by Brenno Carillo, Daytona Beach News-Journal / The Daytona Beach News-Journal
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By Brenno Carillo, Daytona Beach News-Journal | USA TODAY Network
