OCOEE, Fla. – With the state pushing sweeping property tax reform, the city of Ocoee is crafting a contingency plan to protect its budget, and it involves revisiting how residents pay for fire services.
Ocoee anticipates a reduction in property tax revenue of $4.15 million in Fiscal Year 2027 if voters approve proposed changes to homestead exemptions. By Fiscal Year 2028, that projected loss nearly doubles to approximately $8.5 million. City leaders are now exploring ways to make up that revenue.
In May, the Ocoee City Commission voted 4-0 to update the city’s existing fire services assessment program, shifting from a Fire Protection Unit methodology to a Demand and Availability methodology. But the conversation shifted after the Florida Legislature passed property tax reform legislation that, if approved by voters this November, would significantly expand homestead exemptions statewide.
The proposed amendment would increase the homestead exemption to $150,000 in 2027 and to $250,000 in 2028.
[WATCH: Local governments warn of revenue losses under Florida tax proposal]
In response, city staff evaluated multiple funding scenarios and is now recommending the commission adopt a maximum fire assessment funding level equal to 70% of the five-year average assessable fire budget. That ceiling would authorize a maximum net revenue collection of approximately $13.1 million.
Setting a 70% ceiling would allow the city to raise the fire assessment fee incrementally each year, without needing to undertake a full rate adoption process each fiscal year.
Under the proposal, the FY 2027 rate would be set at a 45% funding level, generating approximately $4.56 million in additional net assessment revenue, enough to offset the projected first-year loss of $4.15 million. At that level, homeowners would pay approximately $383.90 per dwelling unit.
By FY 2028, the funding level would increase to 67%, generating approximately $8.99 million in additional net assessment revenue to offset the projected $8.5 million shortfall. Total net assessment revenue at that level would reach approximately $12.57 million, with homeowners paying approximately $571.57 per dwelling unit. Because the 67% level falls within the previously adopted 70% ceiling, no new maximum rate adoption would be required.
Not everyone is on board with the proposed changes to property taxes in the state, as he feels it creates a financial burden for cities like Ocoee.
“I don’t think that it’s a good idea. You’re a lot better off like they are right now,” Jerry Whiddon, an Ocoee resident since 1970, told News 6.
“Common knowledge tells you that they got to get that money from somewhere, and if they give the tax money back to you, they’re going to raise, they’re to get it from somewhere else.”
Commissioners are voting tonight to adopt the amended and restated initial assessment resolution and set a public hearing for Aug. 18 before the final vote.