Lee County revising proposed budget ahead of June adoption vote

LEE COUNTY — Lee County’s proposed fiscal year 2026-27 budget projects stronger local revenue growth, rising operational costs and a major investment tied to updating the county’s tax digest following months of scrutiny surrounding property tax calculations.

The proposed General Fund budget increases from approximately $34.06 million in the current adopted budget to roughly $36.66 million — a jump of about $2.6 million, or 7.6%. County staff, however, are continuing to revise the proposal ahead of final adoption.

Much of the projected growth is driven by higher anticipated property tax collections and sales tax revenues, while county officials also expect increases in alcohol licensing, sanitation fees and other local revenue sources.

Current-year property tax revenue is projected to rise from $14 million to $15 million in the proposed budget. County officials noted that figure will be revised based on the erroneous 2025 rollback rate discussed in an April 24 news release.

Local-option sales tax (LOST) revenues are projected to increase from about $4.66 million to more than $5.02 million, while insurance premium taxes — local taxes levied on insurance companies based on the premiums they collect from policies written within the county — are expected to climb from approximately $2.64 million to $3 million. County officials said those projections are based on current revenue collection trends.

The proposed budget also reflects notable increases in alcohol-related revenues. Revenue from liquor and distilled spirits retail permits is projected to more than triple, rising from $20,350 to $69,170. Beer retail sales revenue is projected to increase from $227,550 to $265,000, while wine retail revenues rise from $37,500 to $51,450. Officials said those projections also are based on current collected revenues.

Commercial sanitation revenues are projected to rise as well. Budget notes state the proposal includes a “5% pass-through rate increase to commercial customers,” indicating at least some increased sanitation and operational costs would be passed directly on to businesses through higher service rates.

At the same time, the county appears to be moving further away from reliance on one-time federal pandemic relief funding.

The current fiscal year budget included approximately $1.12 million in American Rescue Plan Act transfers — federal COVID-19 recovery funds distributed to local governments during and after the pandemic. The proposed FY 2026-27 budget reduces that figure to $535,000.

County officials said ARPA funds must be spent by Dec. 31, 2026, and the remaining $535,000 represents Lee County’s unallocated ARPA funding.

One of the most significant expenditure changes appears under County Commission contractual services. The “Contractual: Other” line item — a category typically used for outside professional or specialized services not otherwise classified — increases dramatically from $7,000 in the current approved budget to $223,700 in the proposed budget.

Budget notes identify $215,000 for “McCormick Solutions for digest update.”

County officials said McCormick Solutions was contracted during the current fiscal year to assist with a commercial, industrial and agricultural revaluation under a contingency agreement, and that the contract amount was moved into the “Contractual: Other” category for FY 2026-27.

The proposed expenditure comes as Lee County continues addressing fallout from a recently discovered rollback rate calculation error that raised questions about tax assessments and potential taxpayer refunds.

Overall purchased and contractual services within the County Commission budget increase from approximately $1.12 million to nearly $1.36 million.

Insurance costs also continue to rise, with non-medical insurance expenses increasing from $750,000 to $775,000.

The final revised budget is expected to be presented to the Lee County Board of Commissioners during its June 9 work session. Commissioners are scheduled to vote on adoption during the June 23 voting session.