Key West homeowners take note: your property taxes are set to go up soon. Last week, the Key West City Commission met and voted on several topics, including reinstating some popular events that have been canceled due to covid, like the powerboat races that are a big draw. But topping their list of items was the Key West city budget. The approved budget includes a 5.5% property tax increase for all residents of Key West properties. Back in August when the topic was initially brought up, the commission proposed a steep 8% property tax increase. As the budget was worked out, eventually a 5.5% increase was settled upon. The vote was not unanimous, however, with the council voting 5 to 2 in favor. The two holdouts were Commissioner Kaufman and Commissioner Wardlow.
Mark Finigan, Key West’s Finance Director, emphasized that the budget only allows for the 5.5% increase (as opposed to the 8% increase originally proposed), as long as certain plans for increasing city revenue are enacted quickly. For example, the new budget includes a program for requiring small fees for all weddings on the popular Smathers Beach. The budget also calls for adding more parking meters throughout certain areas of the city, as well as raising licensing and regulatory fees throughout Key West. Finigan adds that these measures need to be enacted now, stating that the budget will not be balanced if there is delay in implementing these measures.
The new budget voted on last week changes the tax rate to $2.14 per $1,000 of property value assessed. How will this impact residents? In addition to a 5.5% increase, some commissioners pointed out that this increase will likely be passed down to renters. Homeowners who rent out their Key West properties will likely increase the price of rent to off-set the increase. This may also affect residents with homes for sale in Key West, as the property tax increase may put off some potential buyers. The increase is meant to help pay for many city functions, including the hiring of 13 new government positions.