telecommunications coming in second. This revenue stream has increased nominally from the prior year, and it is based primarily on utility rate changes. Due to current economic stagnation a 2% annual growth assumption is used. Expansion of the customer base will be a nominal factor until the City undergoes further boundary growth, infill development, and annexation in the coming years.

Business license revenue is budgeted in the General Fund at $35,000 (General Fund Revenue, page 123), based on recent trends and anticipated business activity in the City. Annual renewals account for the bulk of this revenue. Building and construction permits, now accounted for in a separate Building Services Fund, are budgeted at $1,303,200 (Special Revenue Summary, page 264), based on historical trends and projects anticipated for next year.

Intergovernmental Revenue: Grants, State and Local Shared Revenues, and Payments from Other Local Units

The budget for half-cent sales tax and municipal revenue sharing is based on estimates provided by the State and is distributed by the State derived through calculations based on sales tax revenue and population. Local Government Half-Cent Sales Tax is budgeted at $1,587,136 (General Fund Revenue, page 123). It is distributed by the State based on equally weighted factors of adjusted municipal population, derived municipal sales tax collections, and the City's ability to raise revenue. The FY 2026/27 Adopted Budget includes a slight decrease in Half-Cent Sales Tax revenues due to state legislative actions cutting commercial lease taxes and broader economic flattening. Revenue from State Revenue Sharing is budgeted at $1,244,018. Intergovernmental Revenue is based on historical trends and the current economic situation and is derived from mobile home license taxes, alcohol beverage license taxes, county occupational licenses, payments in lieu of taxes (PILOT), among other sources. Intergovernmental Revenues are budgeted at $278,500 in the General Fund (General Fund Revenue, page 123). The City attempts to secure grant funding to supplement its limited resources whenever possible. This revenue is unknown and is based on grant awards, therefore any grants are budgeted upon grant award and acceptance. Total FY 2026/27 Intergovernmental Revenues are budgeted at $3,109,654 (General Fund Revenue, page 123).

The General Fund's Charges for Services is budgeted at $1,341,288 (General Fund Revenue, page 124), and includes lien searches, garbage billing, false fire alarm charges, and various library and parks and recreation service charges.

Stormwater revenue is budgeted at $934,000 (Stormwater Revenue, page 272). On April 16, 2026, the City Commission approved a residential rate increase from $6.00 to $8.00 per month and a non-residential/Commercial increase from $12.00 to $16.00 per month. Due to limited new development or land use changes, a minimal increase has been budgeted. Charges for water, sewer, and reclaimed water service are budgeted using base charges combined with a tiered rate based upon consumption. Together with connection fees for new accounts, these charges are budgeted at $14,605,000 (Water & Wastewater Revenue, page 281). Given current economic conditions, high inflation and financial insecurities, the City Commission authorized a rate study to determine if the fees and rates charged generate enough revenue to fund operations, maintenance, replacement, debt service, and capital improvements. In FY 2025/26 the City Commission hired a rate consultant to conduct this study. Once the consultant has determined sufficient, competitive rates the City will determine future rates to be set. The irrigation and reclaimed water components of the revenue stream can fluctuate significantly based on seasonal wet or dry cycles as well as the disruption of lawn maintenance routines caused by hurricanes and vegetative debris accumulation. Total budgeted revenues for the utility are $15,475,000 (Water & Wastewater Revenue, page 281). A 4% annual revenue growth assumption has been used for the preparation of the budget. 91