Sarasota County staff is preparing to float new tax options at next week’s budget workshop before the County Commission — including one tax that would not appear on property tax bills — after internal budget documents show spending growth is forcing the county to consider dipping into reserves, shifting money between funds, and reducing services.
The Feb. 26 workshop materials outline two major revenue options: a Public Service Tax (PST) that could impose up to a 10% tax on electricity, gas, and water bills, and the creation of separate Municipal Services Tax Units (MSTUs) for the Sheriff and libraries.
The PST would not appear on property tax notices. Instead, it would show up as an added charge on monthly utility bills.
MSTUs, by contrast, would appear as separate line items on property tax bills. An MSTU is a special property tax district created to fund a specific service.
These revenue ideas are being discussed after staff identified a $23 million shortfall in the FY2026 budget passed last year.
Earlier this month, County Administrator Jonathan Lewis sent a memo warning that “a reduction in service levels will be needed” to stay within the Board’s growth targets.
Taken together, the materials show staff exploring every available option: cutting spending, using reserves, shifting funds, raising revenue, or some combination of all four.
Spending pressure
The budget gap stems from a simple problem: the County is taking in less revenue than it spends. The workshop presentation shows major recurring revenues are not keeping pace with recurring costs in the General Fund — the fund that pays for day-to-day government services.
In an interview late Friday, Deputy County Administrator Steve Botelho acknowledged those structural imbalances will continue unless spending growth is addressed.
“Expenditures are the bigger driving force of our outlook in comparison to the current revenues,” Botelho said.
One slide shows the expenditures of the various constitutional offices and the percentage increase over last year’s budget.
The Sheriff’s Office is one of the largest and fastest-growing components of the General Fund. Other constitutional officers and departments show steady increases as well. Spending by departments controlled by the county administrator grew 7.3% over the last 5 fiscal years and 41.5% since 2009.
The Tax Collector’s budget has grown sharply over the past year — more than any other constitutional office.
After receiving a 34% increase last October, Tax Collector Mike Moran recently sought a budget amendment that would increase his office’s funding even further. If approved, the year-over-year increase would total more than 52%.
The rapid growth contrasts with Moran’s campaign message. When running for office in 2024, Moran positioned himself as a fiscal conservative and criticized his predecessor for overcharging taxpayers.
Moran declined to answer whether his budget could meet the Board’s request that constitutional officers limit increases next year to no more than 1.6%. In a memo, he wrote that his office returned $18 million to the General Fund last year based on excess fees collected — a practice he previously criticized but which is required under Florida law. Moran declined an interview request to explain his math or the circumstances of his budget increase.
When recurring costs grow faster than steady revenues, local governments eventually face difficult choices.
At the December 2025 strategic planning meeting, Commissioner Ron Cutsinger acknowledged that “you’ve got to either raise revenue or make cuts.” At that same meeting, however, Cutsinger said the County “did a great job” on budgeting last year and took “bold action” to prevent overspending.
Commissioners also raised concerns at that meeting about proposed drastic property tax cuts in Tallahassee that could have a major impact on county revenue.
New Taxes Floated
The most eye-catching portion of the workshop materials is the section outlining additional revenue tools.
The presentation includes a slide describing a Public Service Tax — a tax on electricity, natural gas, propane, and water service.
This type of tax appears on utility bills rather than property tax notices. It affects renters, homeowners, and commercial property owners alike. Florida law allows charter counties to impose up to a 10% tax on those services.
Sarasota County considered a 5% Public Service Tax in 2017 but did not move forward after significant public opposition. Its reappearance in this year’s workshop materials suggests staff are again evaluating it as a recurring revenue option.
Botelho said staff are not making a formal recommendation but are “just giving them options of what things are out there that they could consider.” The staff also proposed eliminating a few bus routes, not filling vacancies, pausing an intern program, and contract reductions that would save $1.7 million annually, but there’s still a $23M shortfall.
Commissioner Joe Neunder told the Trident he is not in favor of new taxes on residents.
On average, the 2017 proposal would have cost residents about $53 per year. If imposed today at 5%, that impact would rise to roughly $72 annually due to higher utility rates. At the full 10% allowed under state law, the cost could reach approximately $144 per year for a typical household.
Electricity rates for Florida Power & Light customers in Sarasota have increased roughly 33% since 2017, while Sarasota County water usage rates have risen about 23–25%, depending on usage levels.
Because the Public Service Tax is a percentage of the utility bill, it rises automatically when utility rates increase. Even if the tax rate remains unchanged, the amount residents pay grows as electric and water rates climb.
Compounding that pressure, regulators recently approved a multi-billion-dollar rate increase for FPL customers. At the same time, concerns are mounting statewide that large AI-focused data centers could drive additional infrastructure costs that ultimately show up in residential utility bills.
Staff’s presentation notes that nine other charter counties impose a Public Service Tax, including Alachua, Broward, Clay, Miami-Dade, Orange, Palm Beach, Polk, Seminole, and Volusia.
At least six of those counties are traditionally Democratic-leaning, while Sarasota County has historically been governed by Republicans who have campaigned on fiscally conservative policies.
MSTU Proposal
The presentation also includes a slide suggesting the creation of separate MSTUs.
If Sarasota County created a Sheriff MSTU, the Sheriff’s budget, which comprises 44 percent of the General Fund, could be funded through a separate property tax line instead of the general countywide millage. The same approach could apply to libraries.
An MSTU is not outside funding. It is still a tax on property in the unincorporated parts of the county. The impact on taxpayers depends on whether the County reduces its general millage dollar-for-dollar to offset it.
If millage is lowered elsewhere, the total tax bill might remain level. If not, taxpayers would see a new line added to their bill — a tax increase.
Sheriff Kurt Hoffman said, “the key is who designs the methodology and how is it adjusted up or down.”
In Charlotte County, for example, commission approval is required to adjust an MSTU rate. That governance detail has not yet been outlined publicly for Sarasota.
Botelho said the difference with an MSTU is that, with any increase, “the Sheriff would have to explain. It’s their budget that would be driving it up, versus through the general operating millage.”
“I’m certainly listening closely to the discussion,” Hoffman said.
Former county commissioner Christine Robinson, who now serves as Executive Director of the Argus Foundation, a pro-business group, was critical of the proposed new taxes.
“It took a majority of the county commission to get staff to bring back budget cuts, but then we get MSTUs and a Public Service Tax without anyone asking for it. Government mentality has to change. We don’t have a revenue problem, it’s increased over 30% in 4 years; we have a spending problem,” Robinson said.
Money Shifting and Assumptions
Even without new taxes, the workshop slides show that long-range projections depend heavily on assumptions — including spending being 6% less than budgeted and revenue collections coming in 4% higher than projected.
The County says those assumptions are based on historical averages. But if they do not materialize, the financial outlook could deteriorate quickly.
The presentation also includes a $3 million shift of General Fund projects to voter-approved Surtax funds — a move that frees General Fund cash without reducing the underlying cost.
Whether that represents prudent financial management or a temporary patch depends on how often such swaps occur.
What Happens Next
The Feb. 26 workshop is not a vote on new taxes. But it sets the tone for the coming budget cycle.
Residents should watch for clear answers to several questions:
Is a Sheriff or Library MSTU actively being developed?
Would an MSTU raise total taxes or replace existing millage?
Is a Public Service Tax under serious consideration — and at what rate?
Which services would be reduced if spending growth is not curbed?
Are funding shifts temporary adjustments or signs of deeper imbalance?
The choices by commissioners are not minor policy tweaks. They will determine what residents pay and what they receive in return.
The workshop will reveal whether the County intends to close its budget gap primarily through new revenue, tighter spending control, service reductions, or continued financial reshuffling.
For taxpayers, the time to understand that direction is now — before ideas discussed in a workshop become permanent changes on utility bills and property tax statements.
The Florida Trident is an investigative news outlet focusing on government accountability and transparency across Florida. The Trident was created and first published in 2022 by the Florida Center for Government Accountability, a non-profit organization that facilitates local investigative reporting across the state. About the Author: Michael Barfield focuses on the enforcement of open government laws. He serves as an investigative reporter for the Florida Trident and Director of Public Access at the Florida Center for Government Accountability. He regularly assists journalists across the country with collecting information and publishing news reports obtained from public records and other sources.
