Property owners hoping to see their tax bill from the Hospital District decrease in the fall as a course correction to last year’s 61 percent tax rate increase will be disappointed as trustees voted last week to keep the rate the same.

This means taxpayers, as a result of increased home values, will be billed an additional $850,000 in taxes for the 2025-26 fiscal year and the Hospital District approved plans to increase its operating budget by more than $2.2 million.

Unless the Hospital District tax rate is reduced during public hearings in September, property owners will pay 76.5 cents for every $1,000 of assessed property value. So the owner of a $550,000 home with a homestead exemption will pay $382.50 to the hospital district in the coming tax cycle.

The top-funded agencies and programs that will receive funds in the budget as proposed are:

• Treasure Coast Community Health, slated to receive $4.3 million for six medical, dental and mental health programs;

• Cleveland Clinic Partners in Women’s Health, slated to receive $4.2 million for pre- and post-natal care for  indigent women;

• Whole Family Health Center, slated to receive $1.78 million for seven medical, optical, psychiatric and pharmacy assistance programs; and

• The Visiting Nurse Association of the Treasure Coast, slated to receive $1.3 million for home health, hospice, mobile health and music therapy.

Two public hearings on the hospital district budget will be held in September, so all grant awards and program funding are tentative until then.

The district focuses its efforts on county residents who earn less than 200 percent of the poverty level or are uninsured, though the district also funds agencies and programs which serve or are open to everyone in the county.

While unwilling to slice its budget this year, or even to keep spending steady, the hospital district board did agree to sunset the funding of numerous program grants over the next three years if the program does not fit the statutory guidelines for eligibility.

The district also rejected 11 new inquiries for funding of local nonprofit programs, and switched to a fee-for-service model to tie funding directly to documented services provided to local poor and uninsured people.

“At this point, in evaluating those 43 of the 59 programs, we have cut $1.8 million from the requests that we received from all of our community partners,” Treasurer Michael Kint said.

“With this year's commitment to prioritizing funding on programs that align most strongly with the district's mission and vision, such as offering direct patient care or enabling direct care delivery, or in preventative programs, we have begun the process of sunsetting several programs,” Kint said.

One of the programs placed on a sunset track was the Senior Resource Association’s Meals on Wheels service to seniors and the homebound. For the past two years, the district has upped Meals on Wheels funding to $1 million per year.

Based upon a $1.28 million grant request for 2025-26, the district voted to tentatively award approximately 75 percent of the Meals on Wheels grant request this year or $756,000, with the intent to cut that to 50 percent of this year’s ask in the 2026-27 budget and then 25 percent in the 2027-28 budget, giving the organization time to replace taxpayer funding with private philanthropy.

Senior Resource Association Executive Director Karen Deigl is one of the seven elected hospital distruct trustees, and she recused herself from voting on her organization’s funding.

Strict interpretation of the legislation giving the hospital district its taxing authority more than 60 years ago would mean only spending tax dollars to provide health and medical services by or under the supervision of licensed medical personnel.

Over the years, and especially since the hospital district was relieved of its annual $7-plus million indigent care burden when Cleveland Clinic took over Indian River Hospital, district trustees have adopted a vastly looser interpretation of the statute governing them. This funding of ancillary programs that do not provide health or medical services came under greater scrutiny this year after the district increased the tax rate by 61 percent in 2024.

When Cleveland Clinic Foundation took over the hospital and responsibility for the vast majority of indigent-care, the district budget was expected to shrink. Instead, it has ballooned from $14 million to the proposed budget of more than $23.9 million for the coming year. 

Only one person, Indian River Shores Vice Mayor Bob Auwaerter, rose at last week’s workshop to offer any objection to the continued budget increases.

“You're keeping the millage rate the same,” he said, “but this is a tax increase because you would have to move it all the way back to the rollback rate. So by my calculations on your material here, we're looking at an increase in ad valorem tax revenues of 8.6 percent. This is on top of the 65 percent that you did in the last fiscal year. So I just want to put that on the record.”

The hospital district’s own overhead budget is also set to increase in 2026 by 14 percent or $206,000. Salary expense is expected to increase by $130,000 and legal services, which rose $25,000 in the current year from $150,000 to $175,000 per year, are set to increase by another $20,000.

Included in this coming year’s budget are three new programs Isele has proposed for the district staff to take on totaling $550,000. They are called enabling infrastructure, provider recruitment and retention, and primary/preventative care access expansion program. The exact objectives and accountability benchmarks of those new programs are yet to be determined.

The district has come under fire for spending $4 million to purchase two buildings on four acres just outside the Vero city limits for a women’s sober home without first producing and approving a business plan for the project. The property also has zoning restrictions which may hamper what services the district or its hired operator can deliver in a residential neighborhood.

Staff included $75,000 for upkeep of the property in the coming year’s budget. There is still no real plan for the women’s sober home seven months after purchasing it.

District trustees have expressed interest in providing some level of funding in the coming year to Cleveland Clinic to help shore-up the hospital’s labor and delivery program, but the district decided to conduct a $35,000 survey of women of child-bearing age in the community first to determine how much they value having labor and delivery services in Vero Beach.