City manager talks of ongoing problem of higher bids coming in than anticipated for city projects
With unanimous votes during a special meeting conducted on Sept. 16, the Sarasota City Commission approved the city’s budget for the 2025 fiscal year, which will begin on Oct. 1, and formally set the operating millage rate at 3 mills. That figure is unchanged from this year and the 2023 fiscal year.
One mill represents $1,000 of the value of a piece of property, such as a house or condo.
Altogether, as noted in the budget resolution, the total millage rate for city residents will be 3.1436. The extra millage is linked to bond debt, the resolution pointed out.
The total budget for the 2025 fiscal year is $305,678,879, compared to the current budget of $286,713,513. The anticipated amount of money for the 2025 fiscal year revenue in the General Fund, which pays for operations of city departments that do not generate any money of their own, as well as a variety of city initiatives, is projected to be $106,961,606. A fund balance of $28,711,280 is anticipated by the time the new fiscal year ends on Sept. 30, 2025, a chart noted. That figure equates to 26.8% of budgeted expenditures, the city’s 2025 fiscal year budget document points out.
The largest General Fund expenditure in the new fiscal year is expected for operations of the Sarasota Police Department: $48,978,527.
City staff is estimating property tax revenue at $49,666,909. That money makes up 48.6% of the General Fund, a city pie chart shows.
A utilities excise tax anticipated to generate another $10.4 million and the half-cent sales tax revenue passed down from the state has been put at $7.4 million.
The city’s 2025 fiscal year budget document explains that the excise tax is charged on use of electricity, water, bottled gas and home heating fuels. That revenue is expected to decline by $113,595 in the 2025 fiscal year because of “unexpected spikes in usage” in the current fiscal year, the document says.
The Capital Improvement Program for the 2025 fiscal year is anticipated to total approximately $30,897,000. Transportation projects have been budgeted at $13,098,000, including the 10th Street and Boulevard of the Arts Complete Streets project ($742,000) and the Shade Avenue Complete Street initiative ($169,000). Another $150,000 has been allocated for sidewalk construction.
More public engagement plus performance measures proposed
Only two members of the public addressed the commissioners during the public hearing.
David Lough, president of the Downtown Sarasota Condominium Association (DSCA), commended city staff for holding a budget town hall for residents in the spring — a session he suggested last year, before the current budget won final commission approval.
Lough called the workshop “a positive step,” adding that he was disappointed that more people did not take the opportunity to attend it.
Additionally — noting that he had talked with City Manager Marlon Brown and city Finance Director Kelly Strickland about the issue — Lough suggested that a second town hall be planned each year after the “budget book” for the next fiscal year has been released, to allow for more community engagement.
As city policy stands, Lough pointed out, based on what he has been told, after the budget book has been released, that is too late for residents to offer their thoughts on the spending plans other than during the public comment period at the start of each commission meeting.
Yet another point Lough made is that while the city creates master plans — including the one for Main Street — problems seem to arise in paying for the projects. “We’ve got a cash flow issue, or we’re not thinking about this,” he said. “I’m suggesting the possibility of a workshop on infrastructure funding, for lack of a better word.”
The second speaker, John Mercer, reminded the commissioners that he is the former mayor of Sunnyvale, Calif. He called for performance measures in the annual budgets. “The proposed budget you are considering has no performance measures in it,” he pointed out. Those will not be added, he continued, until after the budget has won final approval.
“That makes no sense at all,” Mercer said. “It means when you approve a program’s budget, you won’t know what level of service you should expect for the money that was spent, or what was achieved in recent years.”
When the measures are added, after-the-fact, he continued, “Too many of them indicate nothing about the program effectiveness.”
As an example, he noted that the city’s street lighting program has as its “so-called performance measure the number of lights maintained.” Mercer asked, “What does that tell you about the level of service?”
In contrast, he pointed out, other cities include such measures as the percentage of streetlights that should be operating on a typical night, along with how quickly repairs should be made after outages have been reported, with a goal having been specified, such as requiring that 95% of repairs take place within three days.
Moreover, he said, the commission should require reports on each measure throughout the fiscal year, perhaps on a monthly or quarterly basis, “so that managers can use the performance data to run their programs to achieve high levels of service.”
Mercer also recommended that the city staff provide five years of budget projections, instead of one. “I don’t know of any city that only does one [outlook for just] a year, except Sarasota. … The rock bottom minimum for cities around the country is five years,” Mercer told the commissioners.
Many cities — including municipalities much smaller than Sarasota, he noted — provide revenue and expenditures projections going out 10 years.
The last budget for Brown
Following the Sept. 16 votes, City Manager Brown took the opportunity to offer a number of remarks himself, pointing out that this would be the final budget he oversaw for the city, given his looming retirement date of Oct. 15.
Among his remarks, he referenced DSCA President Lough’s comments about infrastructure projects.
In spite all of the planning that goes into designing projects, Brown said, when staff puts initiatives out to bid, some of the responses come in at twice the engineering estimates.
The problem is not the cost of materials, Brown continued, as those prices have stabilized. The real issue, he said, is the cost of labor. “There’s so much work — as staff will share with you — that’s happening in the state of Florida and throughout the nation,” he continued. Many contractors are factoring in higher expenses for labor, he indicated.
If the City of Sarasota has to keep competing with other municipalities that can afford to pay more for projects, he said, the city will get less accomplished.
For an example, he told the board members that when staff advertised for bids for a bridge in a low-income Hispanic area near the Sarasota Commons shopping center — near the intersection of Beneva and Fruitville roads — the estimate of the expense was between $300,000 and 4400,000. Yet, Brown pointed out, the city received a bid higher than $700,000.
City staff estimates that $191 million will be available for the City of Sarasota out of the county’s penny sales tax — or “surtax” — revenue over the next 15 years, Brown added. However, unless contractors start submitting lower bids, he continued, that will not go as far in getting work completed.
“This commission and the staff and the future leadership really has to think really true and hard about what projects area a priority,” Brown said, “and whether you’re willing to spend that premium to do these projects now or wait until there’s some settling of labor costs.”
He further noted his expectation that new commissioners will be elected on Nov. 5, with the holders of the three district seats to be decided.
Mayor Liz Alpert and Commissioners Kyle Battie and Erik Arroyo are running for re-election. Only Battie faced a challenge during the Aug. 20 primary.
Referencing Lough’s workshop proposal, Brown characterized that as a time when “staff can really sit down with you and talk about what we’re seeing” in terms of bid estimates and the actual results. In the meantime, he added, he has asked staff “to put off some of [the planned city] projects …”