When the Jacksonville City Council Finance Committee gavels in the first of seven budget hearings Aug. 8, its members will vet a proposed record $1.75 billion city budget and the third-most expensive Capital Improvement Plan in the past decade at $406 million.
In the weeks after her election and in her first 17 days in office, Mayor Donna Deegan worked to put her stamp on a city budget that was well underway before she took office July 1.
Chris Hand, a government law attorney who served four years as former Mayor Alvin Brown’s chief of staff, said the two-week window after taking office for an incoming mayor to file a budget means it is a hybrid of Deegan’s spending priorities and a framework drafted by former Mayor Lenny Curry’s administration.
Hand said it’s notable that Deegan was able to insert $10 million in unrestricted funding for infrastructure resiliency efforts in addition to $75 million for specific resilience projects, as well as $21.72 million to improve the efficiency of the city’s permitting process, focuses of her campaign and inaugural address.
According to Hand, Deegan’s second budget will be a better reflection of her direction for the city.
“Budgets are statements of priorities,” Hand said.
“And with that limited amount of time in office, it is very hard to align a mayor’s first budget with all of her priorities. I think that is something we can look even more to in her next budget, the one that she will propose in July of 2024.”
“Much of the legwork on the budget for the upcoming fiscal year is done by the previous administration,” he said.
For Hand, there were no real surprises in Deegan’s first budget. He said that clarity could make the Council’s review smooth.
A Republican supermajority Council will be reviewing the Democrat mayor’s budget.
But Hand said the mayor appears to have kept the lines of communication open with Republican Council President Ron Salem. She included $3 million in the budget he requested for the Council contingency fund.
Deegan’s five-year, 2024-2028 Capital Improvement Plan uses $64 million in pay-go, or cash on hand, to finance projects. Most of that money is from the city’s remaining American Rescue Plan appropriation from the federal government.
Hand said paying cash makes capital projects less expensive by avoiding interest that accrues when the city has to borrow money to finance the work.
“This is a good year to take a pay-go approach,” Hand said. “The new mayor came into office with a substantial increase in ad valorem and other revenue. That’s a good place for a new mayor to start.”
The budget shows projected ad valorem property tax revenue for the 2023-24 fiscal year is up $135.4 million from last year and tax revenue from the state will increase by $18.8 million.
Hand said Curry and Deegan both had flexibility from increased revenue from local taxes and federal money.
Those conditions may not last, he said.
Brown, a Democrat, and former Mayor John Peyton, a Republican, drafted budgets affected by the Great Recession of 2007-09.
“You definitely have to be considering multiple years down the chessboard in these cases because, obviously, what you invest in capital spending has a significant general fund budget impact as well,” Hand said.
Planning for future bond debt is not the only challenge to the general fund the Deegan administration has to consider.
The city will likely be taking on bond debt in the coming years to help finance Jacksonville Jaguars owner Shad Khan’s proposed $1.4 billion stadium renovation.
As costs for the city’s trash and solid waste disposal program rise without Council raising property owners’ collection fees, the budget transfers $57.25 million from the general fund to make up a deficit in the solid waste disposal fund.
That deficit is up from $29.2 million in the 2022-23 fiscal year.
Hand said whatever the final product, Council and the mayor should remember who owns the budget.
“Let’s not forget who’s at the top of the city of Jacksonville organization chart, and that’s the citizenry,” Hand said.
Deegan recently announced she will visit all 14 Council districts for a series of community conversations Aug. 3-31.
Hand said that would be a good place for people to tell the mayor about their budget priorities and concerns.
“This is ultimately their budget,” Hand said.
“It should be their priorities that are reflected in this budget and the best way to make sure that happens is to engage with elected officials.”