- December 16, 2025
The County Commission began its campaign to reauthorize the half-cent sales tax March 5.
In the face of diminishing revenues and growing capital need, the County Commission began its campaign to reinstate the Local Government Infrastructure Surtax, or half-cent sales tax, March 5, in a workshop.
The tax, which has been in place since 2003 (from 1990 to 2003, it was a one-cent tax) is set to expire Dec. 31. It will be on the ballot for renewal in the next election.
Introducing the item for discussion, County Administrator Craig Coffey explained that the tax had been used in the past to build the current county offices, the Emergency Operations Center, public works and general service buildings, the youth center and the courthouse.
Palm Coast’s portion of the tax was used for roads and drainage.
According to the Department of Revenue, the half-cent tax generates more than $4 million per year, of which the county receives about 29%, or about $1.2 million. Based on an interlocal agreement with Palm Coast, the city currently receives about 64% of the tax, or $2.6 million.
But there is another way to distribute these funds, which Coffey suggested considering. Under the Department of Revenue’s default distribution, the county would receive 45% of the tax (about $1.84 million), and Palm Coast about 50% ($2.03 million).
Under this breakdown, Palm Coast would receive less direct funds, Coffey admitted, but the money would go toward projects almost every resident relies upon daily, like the jail, library and Sheriff’s Office.
“The citizens of Palm Coast (would not be) losing any money — that money is staying in Flagler County,” he said. “It shouldn’t affect them at all. … We’re playing semantics, in a way.”
But certain commissioners worried that a numbers shift would turn some residents off of the tax altogether, risking the possibility of this 22-year-old levy not making it past the voting public.
“You (would be) taking $700,000 away from the other municipalities to use for county purposes,” Commissioner Alan Peterson said. “You have to make sure that the distribution makes sense for all the municipalities.”
Commissioner Milissa Holland agreed.
“A conversation needs to happen with all the municipalities,” she said. “We have to be really, really careful with this.”
Possible future uses for the half-cent sales tax also include new emergency equipment, a fire station on County Road 305 and beach restoration construction.
Further discussion of the tax will be a major agenda item at the next intergovernmental workshop.
