The vote wasn’t unanimous, but the IOP City Council is set to adopt the largest budget in island history for the 2026-27 fiscal year, with an increase to the annual operating millage. It will include $37.49 million for projected revenues and $44.91 million for projected expenses – 49% more than in 2025.
The two amounts not only dwarf all previous island budgets but will require money from existing fund balance reserves, such as the city’s Beach Preservation fund, to make up the $7.42 million shortfall.
“We have a total of 11 separate funds that surplus money is added to at the end of each year,” said IOP City finance director Debra Hamilton. “It’s similar to a savings account – and whenever we need to draw out money to balance our yearly budget, we take it from one of those funds.”
If there are no late changes, the new budget as proposed will take effect July 1 and include a raise in the annual operating millage to 19.2 – a 1.8 mills increase from the current fiscal year – which Hamilton said would “generate approximately $514,000 in additional property tax revenue.”
The new budget was approved on first reading at the May 26 council meeting by a vote of 7-2. Councilmembers Jimmy Ward and Ashley Carroll cast the two no votes. Carroll could not be reached for comment, but Ward said his main objection centered on employee pay raises.
“I didn’t think we did enough for our city employees, especially first responders – I thought they needed a 20% salary increase,” said Ward, adding that too many qualified people keep leaving the city to go to surrounding communities that pay more. “I think they’re going to continue leaving based on pay.”
Expenditures will include a number of projects, such as:
- AI traffic signal implementation
- New police and fire department drone
- New ladder truck for fire department
- Public green space and parking at IOP Marina
- New side loader truck for public works
- Public artwork at Front Beach
- Ocean Boulevard resurfacing
- Drainage
A major portion of expenses, however, will go toward ongoing boulevard improvements and beach renourishment.
Phase 2 of the $1.08 million Waterway Boulevard project, for instance, is currently underway to raise the elevation of footpath areas and install check valves to prevent tidal backflow and help protect the island from future coastal flood risks.
As Isle of Palms enters another summer season of beaches loaded with visitors and vacationers, work crews are undertaking the island’s biggest beach renourishment project to date, placing 2.5 million cubic yards of beach-quality sediment along up to 19,200 linear feet of shoreline on the two ends of the island between now and September.
While the project will cost $21.47 million, it did come in nearly $11 million lower than originally anticipated by IOP City leaders.
The city continues to maintain strong reserves, with cash deposits totaling approximately $57.5 million at the end of March, and about $6.2 million in FY2026 property tax revenues collected from Charleston County.
“We have been good stewards of our city’s finances and are in good financial shape,” said Mayor Phillip Pounds. “There are many competing priorities for the city’s revenue, so it’s certainly a balancing act to put money back into the community, take care of our employees and keep a reasonable level of reserves for future unknowns that will surely come our way.”
By L. C. Leach III
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