Board members worried about state proposals for cutting property taxes, which would result in less county revenue for services
With concerns about the potential loss of much of Sarasota County’s property tax revenue in coming years, the County Commission has voted unanimously to hold off until April 2026 to decide on whether to support the issuance of a City of Sarasota $20-million bond for Phase 3 of The Bay Park on the City of Sarasota’s waterfront.
That decision came on Oct. 21, as the board members met in downtown Sarasota.
A.G. Lafley of Sarasota, founding CEO of the Bay Park Conservancy, had provided the commissioners an update on plans for the next segment of the 53-acre park. He said that it likely would be the summer of 2026 before the bond issuance would be necessary.
(The Conservancy team is charged with planning park amenities and managing them while raising private funds to assist with the overall expense of the park.)
The previous day — Oct. 20 — the Sarasota City Commission voted unanimously to approve the concept of the estimated $20-million bond for Phase 3, contingent on equal funding support from the county.
On Oct. 21, the County Commission did agree to the Conservancy’s request for use of $1 million in county revenue out of the trust fund set up for the park; the money is needed for work that needs to be done before the Phase 3 bonds can be issued, Lafley explained.
The City Commission motion — proposed by interim City Manager Dave Bullock — did not include language about the $1 million. Bullock noted that the money already is available from the trust fund.
Before the County Commission vote, Lafley said, “It would obviously be better for us if you were willing to approve the whole package, with appropriate stipulations that we would deliver.”
Moreover, he had told them, “We fully realize that the county and the city are under incredible budget pressure, given what we’ve all been through in the past year.” He was referring to the 2024 storm season and the significant damage countywide.
In November 2020, the City and County commissions approved an interlocal agreement that established a tax-increment financing (TIF) district that encompassed not only the park site but also surrounding areas. The base year for the district is 2019. Every year subsequent to 2019, if the value of the property in the district rises, then the lower of the city and county millage rates for that year is applied to that property value to determine how much tax revenue from both the city and county will be set aside in the park’s trust fund.
Former County Commissioner Mike Moran voted against the agreement, expressing worries even then about tying up county property tax revenue for the 30-year life of the TIF district.
After Lafley’s Oct. 21 presentation to the County Commission, Commissioner Ron Cutsinger noted, “We’ve got a lot of unknowns coming up,” referring to the property tax issue, with a state legislative committee having provided a variety of proposals for reducing ad valorem taxes for Florida residents, and Gov. Ron DeSantis continuing to push for action.
Delving into the TIF district revenue details
Even before Lafley and Jennifer Compton, an attorney with Loop & Kendrick in Sarasota and chair of the Conservancy board, began their presentation, Steve Botelho, the county’s deputy administrator and chief financial management officer, provided the commissioners an update on the funding for The Bay Park.
A slide that Botelho presented the commissioners showed that the county’s payment into the Bay Park Trust Fund for this fiscal year, which began on Oct. 1, will be $1,536,025. That will cover the county’s portion of the debt service on the $50-million bond that the Sarasota City Commission approved in April 2023 for Phase 2 of the park, he added.
The county’s debt service on that bond will remain level at an estimated $1,535,775 for the 2027 fiscal year, he continued. Through the life of those bonds, which — Botelho said — he believes to be the 2049 fiscal year, the annual debt service would remain about $1.5 million.
In the 2027 fiscal year, the county’s estimated property tax revenue from the Bay Park TIF District is $3,567,670, Botelho noted. Without approval of the Phase 3 bonds, he said, the $2-million difference between the $1,536,025 in county TIF district property tax revenue for this fiscal year and that estimated revenue total for the 2027 fiscal year “would just remain in our General Fund reserves.”
He did explain that that the FY 2027 TIF revenue figure is based on a state projection regarding how much the county property value will rise that fiscal year.
The General Fund is the repository of county revenue, including franchise fees and gas tax revenue. It covers the expenses of county departments that are unable to generate any revenue of their own, as well as offices of the county’s constitutional officers, such as the sheriff and the Sarasota County property appraiser.
Altogether, Botelho told the board, the county has paid about $7 million into the trust fund.
If the city issued $20 million in bonds for Phase 3 — as Lafley has proposed — and the city and the county split the debt service payments 50-50, Botelho continued, the county would need to turn over another $750,000 per year on top of the $1.5 million it is covering in debt service on Phase 2.
Therefore, the $2,031,895 projected to remain in the county’s General Fund Reserve after the 2027 debt service payment on the Phase 2 bonds would fall to close to $1,250,000 if Phase 3 bond debt service were paid, as well.
Botelho did note that the staff in the county’s Office of Financial Management cannot predict the exact changes in property tax values that will occur in future years.
“The TIF is performing far better than we anticipated,” Commissioner Cutsinger acknowledged. “It’s been an amazing success story, basically …”
“The only concern I have, frankly,” Cutsinger continued, is what the Legislature will do. He pointed to the potential of “some pretty dramatic cuts to our ad valorem tax,” which would leave the county “struggling to pay for necessary, essential services …”
Cutsinger told Botelho, “I would feel more comfortable, personally, waiting to the spring” to commit to the bond issuance for Phase 3.
Commissioner Teresa Mast added, “I’m very supportive of the project.” Nonetheless, she said, “I’m not comfortable in approving Phase 3 today.”
Mast added, “We have no idea what’s coming down the pipe” from the Florida Legislature. She said she hoped the commissioners would “know a little bit more” by March or April 2026.
The 2026 legislative session will begin in January.
“I don’t think that it would be in the best interest of Sarasota County,” Mast continued, to approve the proposal that day for the Phase 3 bonds.
“I happen to agree,” Chair Joe Neunder told his colleagues. “I think it makes good sense to be able to hold off a little bit” on Phase 3.
Nonetheless, he said, “It’s a beautiful project. It’s absolutely stunning down there [on the city’s bayfront].”
Commissioner Tom Knight concurred with Mast and Neunder.
Commissioner Mark Smith pointed out that, as more improvements are made in the park, the more the property values will rise in the TIF district. He added, “I firmly believe that future investment in the [park] is very important.” Yet, Smith said he understood his colleagues’ desire to be cautious about the $20-million bond.
Cutsinger ended up making the motion to approve the release of the county’s $1 million for design and permitting work for Phase 3 amenities. However, he said, “I would like to revisit the actual commitment to [Phase 3] in the spring.” He ended up making that proposal part of the motion.
Mast seconded the motion.
Then, in response to a question from Cutsinger, Deputy County Administrator Botelho said that the interlocal agreement between the county and the city that established the TIF district calls for the commissions to decide no later than May 1 each year on any allocations they will make to the Conservancy. Thus, Botelho continued, staff could bring the issue back to the board no later than April 2026 for a decision about the new bonds.
By then, he added, the commissioners and staff should have a better idea of how the state will be proceeding with the property tax issue.
That timeline also will be beneficial, Botelho pointed out, in the context of planning for the county’s 2027 fiscal year budget.
Therefore, Cutsinger included in his motion a call for the next discussion of Phase 3 funding to be in April 2026.
“The support from this commission [for the park] is solid,” Cutsinger added. “But I do think it’s wise to know a little bit more about what’s going to happen to us [in regard to the property tax issue] before we make a final decision.”
The motion passed unanimously.
Checks on the process
During the discussion, Conservancy Founding CEO Lafley reminded the board members that representatives of the Conservancy report twice a year to what is called the Bay Park Improvement Board, which comprises two county commissioners, two city commissioners, and a member of the public. That board first has to approve funding requests, he continued, and then Conservancy representatives have to win votes of approval from both the City and County commissions before proceeding with any further improvements in the park.
Conservancy presentations are provided to each commission in the spring and fall, Lafley noted. “So I think you have a pretty good check on us. … Everything we do is in the sunshine,” he added, “so you can look at all of our books, anytime.”
Cutsinger pointed out that he is one of the two county commissioners on the Bay Park Improvement Board. Commissioner Smith is the other one.
The Bay Park Conservancy team has been working to refine its needs for the next six to nine months,” Lafley told the commissioners.
As a result, he reported, the Conservancy was requesting just the $1 million right away to continue the planning and design work for Phase 3.
“We’ve got to get to 60% schematic plans,” he emphasized, which must be sent to the U.S. Army Corps of Engineers (USACE) and the Southwest Florida Water Management District (SWFWMD), as they “are the two principal agencies [from which] we need to get permits” for new seawalls and a new stormwater system.
The goal, Lafley continued, is to submit those designs to the USACE and SWFWMD by the end of January 2026. It likely will take four to six months, he said, to learn whether those agencies will issue the permits.
If the Phase 3 bond issuance takes place, he indicated that by the end of 2027, “The county and the city and the private community would have $120 million of the $200 million [originally estimated as the cost of the park] invested in improvements that are completed in this park.”
Lafley and Conservancy board Chair Compton pointed out to both commissions last week that The Bay Park is in the midst of its third anniversary celebration. (See the related article in this issue.)