A property tax referendum on the November election ballot is throwing uncertainty into next year’s Sumter County’s budget.
Commissioners are expected to discuss a tentative 2026-27 annual budget at July workshops and County Administrator Bradley Arnold told them Tuesday night that he will prepare for a “worst case scenario.” The next fiscal year begins Oct. 1.
If approved by 60 percent of voters, the referendum would increase the homestead exemption from $50,000 to $150,000 next year and to $250,000 the following year.
Floridians who own homes by the end of this year would qualify while new residents would receive the maximum credit after four years.
School taxes would be exempt from the cuts as are property taxes for police, fire and ambulance services. Local governments also would be able to levy taxes for road and bridge, stormwater and flood control projects as well as county operations.
Arnold said the county could lose at least $16 million in property tax revenue next year and $45 million the following year.
To replace the lost revenue, the county’s options are to raise the tax rate, which is limited by statute, or cut services.
At risk in Sumter County are functions not required by statute such as libraries and services provided to cities.
This fiscal year, the county was expected to collect $113.2 million in property taxes at a historically low rate of $4.89 per $1,000 assessed valuation.
The referendum also would limit annual assessment increases to 5 percent, half of the current 10 percent limit.
It also would require local governments to make plans for the total elimination of property taxes.
Tax savings would be provided for non-residential property to prevent local governments from shifting the tax burden to businesses.