Escambia County commissioners are facing an election-year ticking clock to extend the county’s local sales tax as well as its gas tax.
The County Commission must decide next month if it wants to ask voters this November to renew the 1-cent local option sales tax that expires at the end of 2028.
The local sales tax, which is commonly referred to as LOST, is a one-cent sales tax that has been in place since 1992, when it was first approved by county voters. Since then, voters have approved renewing it the three other times it has come up for renewal. The school district has its own half-cent local sales tax that voters renewed in 2024.
With the statewide sales tax of 6%, the local option sales tax adds an additional one cent for a total of 7.5% to any purchase that’s subject to sales tax, but at transactions above $5,000, the local option tax is capped at $75.
Escambia County Commission Chairwoman Ashlee Hofberger confirmed to the News Journal the board will discuss the language of the renewal and likely vote to schedule the two required public hearings to put it on the ballot in the fall.
“The county will also be holding events to showcase what lost dollars have been spent on so far,” Hofberge said. “I think it’s vital that we let people know how those dollars are used.”
The decision has to be made soon because of the limited number of meetings over the summer and the required two votes to place it on the ballot. The county must get its decision to the Escambia Supervisor of Elections Office by the time the Aug. 18 primary election is certified to make it on the November general election ballot.
The tax can pay for capital expenses for local government, like buildings, stormwater improvements and equipment such as fire trucks and police cars, as well as economic development projects. The $30 million local share of the $210 million ST Engineering project at the Pensacola International Airport was largely funded with local option sales tax dollars.
The revenue generated from the tax is shared between Escambia County and the city of Pensacola based on population. Escambia County projected it would recieve $63 million from the tax in 2026 while Pensacola projected about $9.8 million in the same year.
Pensacola Mayor D.C. Reeves said taxes are a critical funding stream for the city.
“Local Option Sales Tax is critical for us, most importantly in public safety,” Reeves said.
Reeves added that it’s likely most public safety vehicles were purchased with local option sales tax funds.
No change planned for dividing the LOST dollars
While the two governments rely on a state formula law that splits the money based on population, the law also gives local governments the ability to negotiate their own sharing agreement each time the tax is renewed.
Pensacola has seen a decline in LOST tax revenue as the county population has grown, while the city’s population has remained flat.
Reeves said he’s unaware of any talks between city or county staff about altering how the tax is split between the two governments.
Property tax reform has officials worried about sales tax passage
With calls to cut or eliminate property taxes continuing to come from Tallahassee, it is unlikely that any local government would leave sales taxes unchanged if property taxes are cut.
The property tax debate is clearly on the mind of county officials.
During the May 21 Escambia County Commission meeting, Commissioner Steven Barry noted that the debate over whether to put the Escambia County Children’s Trust renewal on the ballot early in 2026 could negatively impact the renewal of LOST.
Barry added that the county is lucky that the Florida Legislature didn’t put any kind of property tax measure on the ballot this year that would have appeared next to a LOST renewal.
“We got very lucky in that no property tax ballot language came out of Tallahassee this session,” Barry said. “…We dodged a bullet, budgetarily, that didn’t happen.
Barry said it would be irresponsible for the county to put any other measure before voters that could negatively impact their perception of LOST, as losing it would be a financial disaster for the county.
“In my opinion, you can’t overstate the impact of local option sales tax on the business of the people that we do here,” Barry said. “It would be apocalyptic, budgetarily, for us.”
Only one shot at renewing LOST before it expires
Even though the county hasn’t officially voted to put the measure on the budget, the conversation at the May 21 meeting, the commissioners appeared to assume it would be on the ballot this year.
Barry said they would be naive to assume the property tax reform effort won’t be on the ballot in 2028 and this year was the year to ask voters.
This year’s referendum will be crucial as, unlike previous renewals, the county will have only one attempt to go to voters with it. A 2023 law limited county LOST renewal referendums to occurring only once within a 48-month window after they expire.
The original 1992 approval of LOST in Escambia County was the second attempt. Voters rejected the tax in 1990 during an August primary but then approved it in a March 1992 presidential preference primary. Today, state law requires the renewal to occur during a general election in November.
If voters reject the LOST, the county will likely have to wait until 2030 to ask voters again, leaving two years without the tax revenue.
The campaign to advocate to Escambia County voters has already begun, with the Penny for Progress local political committee being reformed with $69,000 in donations from Pensacola businesses. The committee launched a website to advocate for the tax’s renewal at PensacolaPenny.com
Gas tax also up for renewal
The local sales tax won’t be the only tax commissioners are tasked with extending this year. The county’s local 6-cent gas sales tax expires at the end of 2026.
The gas tax, last renewed in 2016, doesn’t require a voter referendum like the local sales tax, but to extend it beyond the end of 2026, the county commission will have to pass a renewal ordinance before Oct. 1, according to state law.
The tax is split between Escambia County and Pensacola, as with the sales tax, under a 2017 settlement agreement between the two governments, with the city receiving 15.15% of the tax, according to the city budget.
Escambia County receives about $7.8 million in 2026, and the city receives about $1.3 million.
These votes will also have to take place while the 2027 budget is being considered, two county commissioners are up for reelection, and gas prices are at record highs.
It’ll be a busy summer for Escambia County commissioners.
This article originally appeared on Pensacola News Journal: Escambia County faces deadline to renew local sales and gas taxes
Reporting by Jim Little, Pensacola News Journal / Pensacola News Journal
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