Flagler County government is already drawing up a layoff plan, has frozen most hiring, and is weighing new fees and taxes as officials brace for what could be a $60 million hole in the county budget within two years, the fallout from Florida voters' approval of Amendment 3. Acting County Administrator Adam Mengel laid out the grim arithmetic to commissioners during a four-and-a-half-hour budget workshop, describing a county that relies on property tax revenue to pay for nearly everything residents depend on, from the sheriff's office and jail to elections, courts, parks, environmental protection and the social safety net.
Amendment 3 passed statewide with about 62 percent of the vote, two points above the 60 percent threshold required for passage, according to WUSF. The measure raises the homestead exemption for non-school property taxes from $50,000 to $150,000 starting January 1, 2027, then to $250,000 the following year, while school districts are carved out of the bigger exemption. As FlaglerLive reports, the county is developing a two-phase layoff plan that would first offer voluntary departures to employees before moving to involuntary workforce reductions if the numbers don't add up.
Mengel's Numbers: $27.5 Million, Then $45.6 Million
Mengel estimated the county's general fund could shrink by $27.5 million in the 2027-28 fiscal year, followed by a $45.6 million reduction the year after that, according to the same FlaglerLive account. He told commissioners that planning now for a bigger hit would make the eventual blow easier to absorb, saying everyone should be fine for the coming year, but that 2027-28 remains the unknown of the unknowns. He encouraged commissioners to plan for cuts greater than $33 million in the next budget cycle, arguing that preparing for a steeper decline would soften the impact of roughly $60 million in cuts expected the following year.
Those county-specific estimates sit alongside other projections that paint an even starker picture. The Florida Revenue Estimating Conference pegged the county's reduction at $33 million in 2027-28 and $59 million the year after, per the FlaglerLive report. Separately, the Florida Association of Counties, relying on January 2026 state Ad Valorem Revenue Estimating Conference data, estimated Flagler County's combined revenue impact at $29.5 million in FY 2027-28 and $50.2 million in FY 2028-29. The dossier's underlying figures do not reconcile cleanly across sources, and each estimate carries its own assumptions; no single number has been treated as settled.
A Hiring Freeze and a Department-by-Department Reckoning
The county currently has a hiring freeze in place, with Mengel required to approve every new hire individually. Commissioners were told the county will present a reduction plan for each department identifying services to discontinue or scale back, and will consider canceling existing contracts and agreements. Mengel also suggested proportional-share cuts from the county's constitutional officers, who include the sheriff, property appraiser, tax collector, elections supervisor and clerk of courts.
Commission Chair LeAnn Pennington said the board will need to discuss millage rates and possible new taxing or assessment districts, while also noting that residents want meaningful tax relief paired with government priorities that reflect their preferences. Commissioner Pam Richardson raised a different angle on public safety spending, saying she sees waste in the system and noting that 911 medical calls in Palm Coast often draw five vehicles to a single scene. The seed reporting also notes that public safety services tend to be understaffed rather than overstaffed in Flagler County, and that some redundancy is necessary to maintain safety.
The Menu of Options: Millage, Sales Tax, MSTUs and MSBUs
Among the tools on the table is a one-mill increase to the property tax rate, equal to $1 per $1,000 of taxable value, which could raise roughly $14 million to $15 million under the new exemption scheme; for a home with $200,000 in taxable value, that would mean a $200 tax increase for the year. A half-penny increase to the local sales tax is also being discussed, which could generate about $4 million for the county and $5 million for Palm Coast, though that revenue would have to be spent on infrastructure and could not be used to fund sheriff's deputies, firefighters or other constitutional officers' expenses.
The county is also weighing a municipal service taxing unit, or MSTU, and a municipal service benefit unit, or MSBU, to generate dedicated revenue. An MSTU functions as a tax while an MSBU functions as a fee, and either could be directed toward specific services such as fire protection, policing or parks. Mengel expressed appreciation for the sheriff's office exploring an MSTU of its own. Separately, a special tax for policing can be collected from unincorporated areas without requiring approval from the county's cities, though a countywide version would need that approval. Flagler County previously used a combined MSTU and MSBU structure in 2024 to help fund beach management on the barrier island, with each mechanism expected to generate $857,000 annually at the time, according to Observer Local News, though that vote was only a notice of intent and didn't levy any tax.
Flagler Isn't Alone, and the Numbers Get Bigger Elsewhere
Flagler's predicament fits a statewide pattern. The Florida Association of Counties estimates a combined statewide county revenue impact of about $2.94 billion in FY 2027-28 and $5.05 billion in FY 2028-29. A separate analysis from the Revenue Estimating Conference, reported by Suncoast Searchlight, projects a $4.95 billion shortfall in local non-school property tax revenue statewide in FY 2027-28, potentially swelling to $11.86 billion by FY 2031-32 once the measure is fully phased in. That outlet notes the shortfalls would likely mean cuts to local services alongside increases in other taxes and fees.
On the Treasure Coast, St. Lucie County's communications director told WUSF revenue could fall by about $63 million in the first year and roughly $112 million by 2028. In Martin County, a commissioner put the 2027 budget gap at about $42 million, or roughly 12 percent, growing to about $75 million, or 20 percent, in 2028; a preliminary county analysis found covering next year's gap through taxes on non-homesteaded property alone would require roughly a 19 percent increase. Within Flagler County, Palm Coast was projected to lose $21.7 million by 2028, equal to 47 percent of its property tax revenue and nearly a third of its general fund, while Flagler Beach faces a projected $2.1 million cut, nearly a fifth of its general fund revenue, and Bunnell faces a projected $1 million cut, a third of its property tax revenue and 10 percent of its general fund budget, according to FlaglerLive's reporting.
School Resource Deputies and an Unresolved Legal Question
Flagler County government currently funds half of the school district's 15 school resource deputies, and school boards statewide will feel Amendment 3's effects even though school taxes themselves are spared from the exemption-related changes so far, per FlaglerLive. The amendment also requires out-of-state homebuyers to wait five years before benefiting from the new homestead exemption, a provision the same reporting says is expected to be challenged as unconstitutional; if that waiting period is struck down, county revenue would fall further still, according to the FlaglerLive account.
The county's next budget, covering the fiscal year that begins October 1, 2027, will reflect the first wave of major cuts, with a formal budget discussion scheduled for January. Mengel noted that Governor Ron DeSantis, described in the reporting as a lame-duck governor facing a presidential run in January, might address the fallout through a legislative special session. A separate DeSantis tax proposal that would have expanded the homestead exemption to school taxes and provided funds for stressed local governments was previously rejected by the Florida Legislature, according to FlaglerLive, whose Pierre Tristam authored the original account of the county's budget workshop.
