Fernandina Beach property owners face a $41.05 increase per $100,000 of taxable value under a proposed tax rate heading to the City Commission on Thursday, Sept. 3.

The special meeting and public hearing begins at 5 p.m. The proposed operating millage rate of 4.8530 mills represents a 9.24% increase over the rollback rate under Florida's Truth in Millage law, the Fernandina Observer reported. At that rate, city property taxes would total $485.30 per $100,000 of taxable value. The rollback rate of 4.4425 mills would produce $444.25 on the same amount.

The city's current millage rate is 4.6849 mills, meaning the proposed rate would also be an increase over what property owners pay now.

The rollback rate is calculated to produce roughly the same revenue as the prior year from existing property, excluding new construction.

Why the rate went up

The higher rate traces directly to the collapse of paid parking downtown.

On Aug. 18, about 75% of Fernandina Beach voters who cast ballots approved a referendum rejecting the program. Turnout hit 48.63%, with 4,168 "yes" votes among 5,565 ballots. The commission voted 4-1 on Aug. 19 to terminate the city's contract with One Parking, though the program will remain in effect through Nov. 18 under a 90-day notice requirement.

City Manager Sarah Campbell had flagged the connection months earlier. At the commission's July 28 meeting, she told commissioners the 4.8530-mill figure was chosen to replace $1.5 million in paid-parking revenue earmarked for the city's waterfront redevelopment project.

"The reason that number is specific is because $1.5 million is how much paid parking revenue we have allocated to the waterfront redevelopment project," Campbell said at the July 28 meeting, the Fernandina Observer reported.

The commission voted 4-1 that night to set 4.8530 mills as the tentative maximum rate. Mayor James Antun and Commissioners Tim Poynter, Genece Minshew and Joyce Tuten supported it. Vice Mayor Darron Ayscue cast the lone dissenting vote.

What's at stake beyond this year

A Florida constitutional amendment on the November ballot could compound the city's budget pressure. Amendment 3, titled "Increased Homestead Exemption; Lower Cap on Increases in Non-Homesteaded Property Assessments," would raise the non-school homestead exemption to $150,000 in 2027 and $250,000 in 2028. School district property taxes would not be affected.

Florida League of Cities data estimate the $250,000 exemption would strip roughly $741.4 million from Fernandina Beach's taxable property value, a 15.6% reduction. At the proposed 4.8530-mill rate, that translates to approximately $3.6 million in lost annual city property tax revenue. Property taxes are the city's largest recurring General Fund revenue source.

Statewide, Florida's Revenue Estimating Conference projected the amendment would reduce local property tax collections by nearly $4.93 billion in the 2027-28 fiscal year, WTXL reported. The amendment needs 60% voter approval to pass.

The city has already deferred $2.5 million in capital projects for the upcoming year. Commissioner Minshew, speaking Aug. 19 when the commission terminated the parking contract, said ending paid parking would not erase the city's financial obligations.

What happens next

The Sept. 3 vote will not be the final action on the millage rate or the budget. Commissioners can lower the 4.8530-mill rate before final adoption but cannot raise it above that ceiling. The final public hearing on the 2026-27 millage rate and budget is scheduled for Tuesday, Sept. 15, at 5:05 p.m.