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Okaloosa County proposes $768–769 million budget; staff warns homestead-exemption could cut property-tax revenue by about 23%
Summary
County staff presented a proposed FY 2026–27 all-funds budget of roughly $768–769 million, held the recommended county millage at 3.8308 mills and said a November ballot homestead-exemption measure could reduce property-tax revenue by about 23% in year two, prompting contingency planning and September public hearings.
County staff on Tuesday presented a proposed FY 2026–27 all‑funds budget of about $768–769 million and urged commissioners to weigh a range of contingency plans, including holdbacks on hiring and capital projects, if a homestead‑exemption measure passes on the November ballot.
The county administrator said staff are presenting a budget “based on what we know,” including a recommended county millage rate of 3.8308 mills and an MSTU rate of 0.288 mills, and noted that unassigned general‑fund reserves stand at approximately $23,000,000 (about two months of operating expenditures). The administrator told the board that if the homestead‑exemption proposal succeeds in a second year it could “impact our general fund revenues, our property tax revenues by 23%.”
Why it matters: property‑tax revenue provides much of the county’s discretionary funding for services. Administrator remarks framed the proposed budget as conservative on revenue assumptions and said staff will present options—holding any new general‑fund positions and postponing some capital projects—until voters resolve the measure.
Key details: the administrator said property values are projected to rise about 2.4%, producing about $744 million in assessed value growth countywide, but cautioned that overall discretionary revenue is sensitive to statewide changes and to the pending ballot question. Staff recommended a 3% salary market adjustment be included in the FY27 plan and said the county secured a rate hold from Blue Cross Blue Shield for the county’s health plan for the upcoming year.
The administrator also detailed the schedule for the budget process: workshops in July, follow‑up workshops next week, and the series of public hearings starting Sept. 3 in Crestview and culminating with final adoption on Sept. 15 at the administration building in Shalimar.
What’s next: commissioners will review department presentations over the next weeks; staff said they will present holdbacks and contingency options should the homestead‑exemption results require budget reductions. Public hearings are scheduled in September for formal public input and adoption.
