County reports $37M property tax revenue increase amid market stabilization

In a recent budget workshop held by the Pasco Board of County Commissioners, officials discussed the county's financial outlook and the implications of property tax revenue amid a cooling housing market. The meeting, which took place on June 19, 2025, highlighted key trends in new construction and property revaluations that are shaping the county's fiscal strategy.

County officials noted that while the rapid growth in new construction is expected to stabilize, they do not foresee a drastic decline in property values. This cautious optimism stems from lessons learned during the recent recession, suggesting a more leveled approach to future growth. The county's taxable assessed value is influenced by several factors, including new constructions, revaluations of existing properties, and market dynamics, particularly the influx of out-of-state buyers during and after the COVID-19 pandemic.

The property appraiser's June 1 report indicated a 9.5% growth in assessed values, with revaluations contributing significantly to this figure. Last year, revaluations accounted for a staggering 78%, but this year, the number has cooled to 34%. This shift reflects the anticipated stabilization in the housing market, prompting the board to model revenue growth conservatively at 5%, 7%, and 9%.

The financial implications of these trends are significant. The county expects an increase of approximately $37 million in property tax revenue, with allocations earmarked for various departments, including nearly $14.8 million for the sheriff's office. Other allocations include $700,000 for community redevelopment and $6.1 million for tax increment financing units. However, the general fund faces pressure as sales tax revenues do not match previous growth rates, complicating budget planning.

Looking ahead, the county anticipates starting the fiscal year with a fund balance of $97 million and projected revenues of $583 million. However, expenses are expected to exceed revenues at $629 million, indicating a need to draw from reserves. This could leave the county with approximately $50.6 million in reserves, equating to about 35 days of operating funds, below the preferred 60 days.

The discussions at the workshop underscore the challenges Pasco County faces in balancing growth with fiscal responsibility. As the county navigates these financial waters, the decisions made in this budget workshop will have lasting implications for its services and infrastructure in the coming years.