OCEAN CITY – Ocean City Council voted unanimously to introduce the 2026 municipal budget April 23. Although the bottom line grew because of grants received, the tax levy and tax rate proposed in Mayor Jay Gillian’s budget in March has remained the same.
“Now it looks like the budget is up $12 million (from this year) instead of $5 million,” Chief Financial Office Frank Donato said while making a short presentation before council. “If you read a headline on Facebook tomorrow, it’s not true. Spending is not out of control. It’s in the grants. I just want to get that out there.”
The budget Donato presented and that was introduced shows a spending plan of $125.4 million for the 2026 fiscal year. It is an increase of $11.9 million over this year’s budget of $113.5 million, but he cautioned that amount is up because of some $8 million in additional grants that were not included in the mayor’s budget.
All the grants have matching offsets on the expense side of the budget.
The local tax rate will increase 1.38 cents per $100 of assessed valuation to 58.58 cents per $100, an increase of 2.41 percent. That is the same as what the mayor proposed in his budget.
The local purpose tax levy rose $2.86 million to $76.88 million, a 3.87 percent increase. Again, Donato said, no change from what was proposed earlier.
The mayor’s original budget showed spending at $118 million before the grants were included.
The difference, Donato explained, is that the city has now included the grants received. The biggest one, for $5 million, was announced last week by Gillian and the New Jersey Department of Environmental Protection. It is to pay for marsh restoration on Shooting Island.
The other large grant is $3 million from resident Leon Grisbaum, who pledged that amount for a new terminal building at the Ocean City Municipal Airport. The city is matching that with $3 million.
Donato said the city had already received Grisbaum’s donation but had not included it in the budget until it had the matching expense.
“All (the grants) do is increase the bottom line of the budget, but they do nothing to increase taxation,” he said.
The city benefits from another $175 million increase in ratables year over year, growing to $13.125 billion in property islandwide.
As always, the biggest expense in the budget is salaries and wages, which amount to $40.688 million. Ocean City has paid fire and police departments. Salaries and wages for fire and rescue services, including for the lifeguard division that protects the city’s beaches and bathers, is $11.225 million. Salaries and wages for the police department are $10.8 million. For taxpayers, they benefit from having paid firefighters and police protecting life and property, and also because having the paid departments reduces the cost for home insurance.
Employee group insurance in the city’s budget grew by just more than $1 million year to year.
City Council approved the introduction with minimal comment. The budget will be back before council at the May 21 meeting.
“There is still time to deliberate, to ask questions,” Donato said.
– By DAVID NAHAN/Sentinel staff