Annual financial report — Sebastian, Florida

Sebastian's Annual Comprehensive Financial Report for the fiscal year ended September 30, 2025 received an unqualified, or clean, opinion from the city's independent auditors, Carr, Riggs & Ingram (ACFR 2025, page 6).

The report is the audited record of the year just closed, which makes it a different document from the Sebastian budget, the plan for the year ahead that the City Council must adopt no later than the close of the fiscal year (ACFR 2025, page 7). The transmittal letter, dated March 26, 2026, explains that Chapter 218.39, Florida Statutes requires the city's financial statements to be audited by a certified public accountant, and that state law requires every general purpose local government to publish a complete set of audited statements (transmittal letter).

The report includes all funds of the City of Sebastian. Two separate bodies are folded in as blended component units: the Community Redevelopment Agency and the Sebastian Police Officer's Pension Trust Fund (ACFR 2025, page 7). The city's Financial Statements archive lists each ACFR from 2025 back to 2004, alongside separate basic financial statements for the CRA (City of Sebastian Financial Statements). Last verified: October 12, 2026, on the City of Sebastian website.

At September 30, 2025, Sebastian's assets and deferred outflows exceeded its liabilities and deferred inflows by $97,456,442, its net position, an increase of $6,533,069 over the year (ACFR 2025, page 20).

The arithmetic checks: $97,456,442 minus $90,923,373 is $6,533,069, the increase the Sebastian report states. Most of that worth is pavement, buildings and land rather than cash. The report says 78% of net position reflects investment in capital assets such as land, buildings, equipment and infrastructure, which are not available for future spending (ACFR 2025, page 23). The unrestricted slice, $11,169,699 at the end of fiscal 2025, is the part that may be used to meet the city's ongoing obligations.

Capital assets grew because Sebastian finished work. The report credits street reconstruction under the year's paving plan, a new vacuum truck and backhoe, a police patrol boat, and three new square hangars and a rehabilitated runway at Sebastian Municipal Airport (ACFR 2025, page 29). Total liabilities fell from $6,938,977 to $6,087,341 between the two year-ends.

In fiscal 2025 Sebastian reported $39,762,002 in total revenues and $33,228,933 in total expenses across governmental and business-type activities, up from $36,962,690 and $27,915,985 a year earlier (ACFR 2025, page 24).

The jump in charges for services has a Sebastian-specific cause. The report says charges rose because all residents were required to participate in solid waste pickup beginning in fiscal year 2025, worth about $2.3 million (statement of activities). Property tax revenue rose from $6,915,611 to $7,703,072, a gain of $787,461, which the report ties to higher property values.

Spending grew faster. Governmental expenses increased $4,440,274, or 18.9%, over fiscal 2024; the report names wages and benefits as the largest driver, citing the third year of negotiated pay increases from a pay and benefits study, with law enforcement and maintenance pay raised most, and eight added positions (ACFR 2025, page 24). Public safety remained the largest Sebastian expense line at $9,504,397, including $1,254,358 in the business-type column, where the city accounts for its building permitting function (ACFR 2025, page 21).

Sebastian's General Fund ended fiscal 2025 with $10,342,092 in unrestricted fund balance, about 57% of a year's General Fund spending, (ACFR 2025, page 20), down from about 64% at the end of fiscal 2024 (ACFR 2024, page 20).

Across all Sebastian governmental funds, combined ending fund balances were $20,894,729, a decrease of $2,431,021 from fiscal 2024 (financial highlights). The fiscal 2024 report had shown $23,325,750 in governmental fund balances and a General Fund unrestricted balance of $10,462,385, about 64% of General Fund expenditures (ACFR 2024, page 20). Of the 2025 total, $8,231,687, or 39.4%, was unassigned and available at the city's discretion (ACFR 2025, page 26).

Much of the rest is fenced by law or grant terms. The Sebastian report lists $5,747,575 restricted to infrastructure improvements, $1,903,839 for stormwater projects, $600,580 for perpetual care at the Sebastian cemetery and $1,274,333 for community development inside the Riverfront Redevelopment boundaries, plus $129,562 committed to development of public parking (ACFR 2025, page 26).

The three business-type funds tell separate stories. At the end of fiscal 2025 the Sebastian Municipal Golf Course Fund carried an unrestricted deficit of $1,029,054, the Airport Fund had $205,210 unrestricted, and the Building Fund had $2,397,944 (ACFR 2025, page 27).

Sebastian had no notes payable outstanding at the end of fiscal 2025 (ACFR 2025, page 29), and its ten-year debt schedule shows no bonds, notes or leases in fiscal 2024 or 2025 (Schedule C1, page 144).

In fiscal 2016 Sebastian owed $4,106,000 in roadway improvement notes, sales tax bonds and notes, and stormwater utility bonds and notes, $193 per resident (Schedule C1). The notes were retired by fiscal 2023, when the remaining balance of $4,222,408 was lease liabilities. The fiscal 2024 report records that long-term debt fell by $4,212,408 as the lease liability for the golf course ended (ACFR 2024, page 20).

What remains are accounting liabilities, not borrowing. Note 6 lists compensated absences of $1,923,378 for governmental activities and $307,522 for business-type activities, and a $57,540 pollution remediation liability (ACFR 2025, Note 6). That liability traces to petroleum contamination at the Sebastian Public Works Department on April 22, 1991, and a Florida Department of Environmental Protection order dated March 10, 1997.

In state data for fiscal 2024, Sebastian collected $257.02 per resident in property taxes, between Fellsmere at $150.74 and Vero Beach at $671.94, according to the Florida Office of Economic and Demographic Research (EDR, Sebastian).

The EDR files, compiled from reports the cities file with the Florida Department of Financial Services, count every fund. That is why Vero Beach looks so much larger: its fiscal 2024 total includes $42,829,132 in enterprise funds and $40,082,873 in pension funds (EDR, Vero Beach), while Sebastian's $50,851,872 total includes $17,659,200 in its General Fund (EDR, Sebastian). Fellsmere reported $10,922,062 in total (EDR, Fellsmere) and $752,175 in ad valorem taxes (EDR, Fellsmere ad valorem); Vero Beach reported $11,291,985 in ad valorem taxes (EDR, Vero Beach ad valorem). The EDR population for Sebastian in 2024 was 26,907 (EDR).

The state data also cross-checks the audit. EDR's Sebastian ad valorem figure of $6,915,611 for fiscal 2024 matches the property tax line in the ACFR's prior-year column. On the spending side, EDR lists Sebastian's fiscal 2024 expenditures at $40,727,939, or $1,513.66 per resident (EDR expenditures), with public safety at $8,793,698 (EDR public safety). The Sebastian EDR expenditure total includes $8,286,596 in inter-fund transfers out (EDR other uses), so it is not directly comparable with the ACFR expense total.

The fiscal 2025 single audit of Sebastian's grants reported no findings, gave unmodified opinions, and cleared all five findings from fiscal 2024 (ACFR 2025, page 156).

The auditors tested two major programs: the federal Hazard Mitigation Grant, assistance listing 97.039, and the state Aviation Grant Programs, CSFA 55.004, which fund work at Sebastian Municipal Airport (schedule of findings). The schedule of awards shows $3,045,587 in federal expenditures, of which $1,893,593 came from the Hazard Mitigation Grant, and $1,361,926 in state financial assistance, mostly Florida Department of Transportation aviation grants for hangars, an apron and a taxiway at the Sebastian airport (ACFR 2025, page 157). Findings 2024-001 through 2024-005, carried from the prior Sebastian audit, are all marked cleared.

The auditors' separate management letter does carry one repeated item, 2024-006, Building Department Excess Funds: Sebastian's unexpended building permit funds at September 30, 2025 exceeded the limit in Section 553.80(7)(a), Florida Statutes, by $1,312,973, (ACFR 2025, page 161), and management responded that it is seeking ways to comply (page 162).