Will Okaloosa expand bed tax district countywide? It's up to voters.

Tony Judnich
Northwest Florida Daily News

SHALIMAR — At its final budget hearing Tuesday, the Okaloosa County Commission unanimously adopted a countywide millage rate of 3.83 mills and a total budget of more than $511 million for fiscal year 2022.

The new budget year starts Oct. 1. The 3.83 millage rate equates to $383 per $100,000 of taxable property value, and has been in place since the 2018 budget year.

The new budget represents a 15% increase from this year's spending plan, with the majority of the spike directly related to federal coronavirus pandemic aid.

During the commission’s regular meeting held just before the final budget hearing, the board unanimously approved an ordinance to expand the tourist development tax district countywide and an amendment of the county's tourism development plan.

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Voters have until 7 p.m. Oct. 5 to return their mail-in ballots on Okaloosa County's bed tax district expansion question.

The ordinance takes effect only if a majority of voters approve the mail-in referendum on the potential countywide tourist development tax or “bed tax” district. Ballots began being mailed to eligible voters Sept. 15 and must be returned by 7 p.m. Oct. 5.

The existing bed tax district was approved in 1989 and encompasses Destin, Cinco Bayou and most of Fort Walton Beach and Mary Esther, as well as unincorporated areas adjacent to Destin and Fort Walton Beach, such as Okaloosa Island.

Expenses of the county Tourist Development Council are funded by the 5% bed tax paid by people staying overnight at lodgings in the district.

In recent years, the district's bed tax has generated from $18 million to more than $23 million per year, with most of the money used to promote the area to tourists and to fund beach safety and beach improvements.

With voters’ approval, Niceville, Valparaiso, Crestview, Shalimar, Laurel Hill, the rest of Fort Walton Beach and Mary Esther and more unincorporated areas all would join the district.

About 117,000 voters from those areas are eligible to vote on the district-expansion question.

If the district becomes countywide, Okaloosa would start charging and collecting a bed tax in the expansion area on March 1, 2022.

A 4% bed tax would be charged in the expansion area until March 1, 2025, when an additional 1% would be added to equal the 5% already charged in the existing district.

People fill the beach on Okaloosa Island on Tuesday as rough surf churns up the Gulf of Mexico. Tuesday's rough surf kept swimmers along the beaches on Okaloosa Island and Destin close to shore.

The potential expansion area has almost 3,000 lodging units. It could generate an annual total of $2 million to $3 million in additional bed tax revenue that could help pay for tourism-related amenities and activities, environmental improvements and other items.

In other business Tuesday, the County Commission approved the hiring of Sheila Fitzgerald as the new deputy county administrator of support services.

Fitzgerald’s more than 17 years of local government experience includes serving as Gulf Breeze’s assistant city manager from August 2020 to this past June.

She is set to begin work Oct. 4. Her starting salary is about $135,000.

The deputy county administrator of support services position had been unfilled since Kay Godwin retired from the role early last year.

Since then, many support services’ duties have been handled by Deputy County Administrator of Operations Craig Coffey.