Council debates potential budget hits if state expands homestead exemption; staff outlines cuts that would follow

City Manager James Booth and finance staff briefed the council June 1 on a special session proposal in Tallahassee that would expand homestead exemptions (phasing from $150,000 to $250,000) and otherwise change property-tax calculation rules. Booth said the proposal could reduce local general-fund revenues and shift much property-tax revenue into restricted infrastructure accounts.

Booth summarized preliminary numbers: of about 810 taxable parcels in the city, roughly 414 are homesteaded and homesteaded parcels account for a notable share of the city's taxable value. "When you run the calculation, it's about a $120,000 maybe $130,000 drop" in city revenue under the model staff ran, Booth said. Finance staff told the council a draft FY2027 budget already starts with a planned $170,000 drawdown of reserves and that implementation of the state proposal would force cuts to non-core services.

Council members discussed specific trade-offs. Staff listed candidate reductions: canceling or scaling back large community events (fireworks, fall festival, summer concerts), eliminating modest annual community grants (Kiwanis boulevard colors, lake-related funding), and shifting staff roles toward grant-writing and infrastructure prioritization. "Anything that would have been called an event goes away," Booth said in describing the planning baseline under the modeled scenario.

Councilors also discussed possible mitigations: pursuing TDC (tourist development) or other grant support for marquee events, redirecting community redevelopment agency infrastructure funds for prioritized capital work, and planning public outreach so residents understand possible service reductions. The council asked staff to prepare follow-up budget scenarios and to monitor the legislature's timetable during the special session.