Could booming tourism help ease Pinellas’ budget squeeze?

Pinellas County is preparing for tighter budgets while one of its revenue streams continues to surge: taxes paid by tourists.

That contrast prompted a discussion at the Aug. 19 Tourist Development Council meeting about whether tourism dollars could play a larger role if voters approve Amendment 3, a proposed property-tax overhaul that could further reduce local government revenue.

For now, Florida law limits how those dollars can be spent. Commissioner Chris Latvala said the rules governing them could become part of a much larger conversation if Amendment 3 passes.

“If Amendment 3 does pass, I think that I would not be surprised if the Legislature allows counties to use TDC funding in a much more flexible manner than currently is allowed,” Latvala said.

The discussion comes as Pinellas works through a fiscal 2027 budget with a General Fund deficit of more than $30 million.

County administrators have proposed staffing and service reductions, along with higher parking, boat-ramp and annual-pass fees.

Those proposals caught the attention of TDC member Dylan Hubbard, who argued that some of the places affected by county budget decisions are also part of Pinellas’ tourism economy.

“I think this board needs to maybe potentially have a conversation around it or be involved in the discussion because I think it directly will impact tourism,” Hubbard said.

He pointed to Fort De Soto, where the county is considering replacing its $6 daily parking charge with a $3.50 hourly rate.

Hubbard acknowledged that the current rate is inexpensive. His concern was what a substantial increase could mean for families and campers who spend hours or days at the park.

“That clientele, if you will, isn’t the affluent clientele that’s going to be visiting Clearwater Beach and paying $5 an hour for parking or whatever the city is,” Hubbard said.

County commissioners have since discussed placing a $15 daily cap on the proposed hourly parking rate. Administrators estimate increases to beach parking, boat ramps and annual passes could generate about $2.77 million annually.

The parking proposal was one example of a broader effort to close the county’s existing budget gap. During the TDC discussion, Latvala defended County Administrator Barry Burton’s search for savings while pointing to another financial challenge that has yet to arrive.

“In his defense, we are facing a budget shortfall,” Latvala said of Burton’s recommendations. “And then that is also, I will add, that’s before any impacts of Amendment 3 in November.”

The amendment would allow qualifying homeowners to exempt substantially more of their property value from non-school taxes and would reduce the annual assessment cap on non-homestead property from 10% to 5%. The changes would reduce taxable property values, although how much revenue local governments ultimately lose would depend in part on the tax rates they set.

St. Petersburg has offered a glimpse of the potential scale. City administrators estimate Amendment 3 could reduce its General Fund revenue by about $33 million in fiscal 2028 and another $21 million the following year.

Tourism revenues in Pinellas, meanwhile, are moving in the opposite direction.

The county collected about $8.6 million in tourist development taxes in June, nearly 15% more than the same month a year earlier. Through June, gross collections for the fiscal year totaled nearly $79.8 million.

Visit St. Pete-Clearwater has said the county is coming off its strongest spring tourism season on record and is on pace to surpass its previous annual record for the 6% tax on short-term lodging.

The prospect of lawmakers giving counties more flexibility over that growing pot of money raises another question for the tourism industry: How much should remain dedicated to promoting and supporting the destination?

Russ Kimball, CEO of the Sheraton Sand Key Resort and a TDC member, described a potential “push pull” for the hotel industry over how tourist development taxes should be used. Whatever changes might come, he said the industry should have a seat at the table.

“We want to be involved as an industry,” Kimball said. “I think that’s the key to this.”

TDC Chair Dave Eggers suggested the council keep the issue in front of members as the November election approaches.

“I think we should probably look at it each month going forward,” Eggers said. “We need to make sure we’re really paying attention as an industry right now.”