Flagler’s Tourism Council Agrees to Continuing Shift of Bed Tax Dollars to Cash-Strapped Beach Management

Flagler County’s Tourist Development Council on Wednesday easily granted the County Commission’s request to continue shifting tax revenue earmarked for tourism-related capital projects to beach management instead. 

The county is severely cash-strapped for its long-term beach management plan. The request is the latest reflection of the County Commission’s failure to approve a funded beach management plan, after coming close. 

“We do need these funds,” Interim County Administrator Adam Mengel said. “We haven’t come up with any other alternate funding sources. There’s been lots of discussions. I’m sure you’ve followed those, and certainly those discussions are ongoing. But we do need this allocation for yet another year. We won’t, or at least haven’t had any guidance yet to go beyond that.”

Beach management is a combination of dune reconstruction and beach renourishment. All such projects to date, including the renourishment about to start early next year and cover five miles north of North 7th Street in Flagler Beach, have relied overwhelmingly on state and federal grants, with some local matches, using TDC and other funds. 

TDC dollars are generated by a 5 percent sales surtax on hotel, motel, short-term rental and RV bookings in the county, so most of it comes from visitors. No general fund (or property tax) dollars are involved. The tourist tax generated $4.4 million in 2025, a 3 percent increase over the previous year but still not as healthy as in 2023. Projected revenue this year is $4.4 million. 

Beach management is now taking 40 percent of that. The rest goes toward paying for the tourism division’s personnel, marketing and advertising Flagler County, and promotional grants to organizations hosting tourist-drawing events in the county. 

The consequence of the money shift from capital projects to beach management is that the TDC’s once-opulent capital fund, which peaked at $5.7 million last year, will dwindle to $1.5 million in the coming year. The council will once again not award any capital grants for local projects. 

Such grants have included a $739,000 contribution toward the construction of Palm Coast’s Southern Recreation Center and, this year, the latest of three such grants over the years to add lights at Palm Coast’s Indian Trails Sports Complex. Palm Coast received $150,000 in 2011 and 2014, and $357,000 this year. That was not new money. Palm Coast lucked out when Flagler Beach returned a $745,000 grant it had been awarded in 2024 to build a new Beachwalk. The city elected to shelve the project when costs surpassed expectations. The tourism council then awarded half the money to Palm Coast. 

Amy Lukasik, the county’s tourism director, had no choice but to go along with the request which, even if the tourism council denied, could be overridden by the commission. “Moving forward for fiscal year 27 would be definitely beneficial to the county,” she said. “It allows them to continue to work on a permanent funding plan. We will also in our next TDC meeting have our 10-year tourism master plan, and I think the beach will be addressed in there as well, and kind of what we can do moving forward to continue to support the need that’s there. So, no, I fully support the recommendation.”

Nothing says that the commission will approve a funding plan next year, enabling the TDC to win back its capital fund. But several factors suggest the county will have a broader window to do so: it will have a new county administrator in place, one of whose top assignments will be to devise a beach-funding plan. It won’t be an election year. And the administration has a new coastal engineer in place. On the other hand, if voters approve Amendment 3, the proposed constitutional amendment to raise the homestead exemption by $250,000 by 2028, chances of an effective funding plan again dwindle. 

The council adopted the recommendation unanimously. 

County Commissioner Andy Dance, who chairs the tourism council, noted that he’s been working with Lukasik on a legislative proposal that would allow smaller counties like Flagler to add a sixth penny–or raise the tourism surtax to 6 percent–to ” give us a little more flexibility in trying to meet some of the demands that we have locally on those tourism funds.” The proposal went to the Florida Association of Counties last year, but it was not pushed through. Dance is looking to resubmit the proposal this year. “Right now we’re we’re kind of prohibited from being able to pursue the extra penny. So some changes legislatively would need to be made.” Getting the backing of the association would make securing a sponsor for the legislation easier.