Surtax Frequently Asked Questions

What is a surtax?

A surtax is an additional sales tax that individual counties can choose to impose on top of the statewide 6% sales and use tax. It's sometimes called a local option county sales tax. In Okaloosa County, voters approved in 2018, a half-cent (.5%) sales tax increase to address the rapid growth of the County, aging infrastructure like roads and stormwater systems, and the demand for public safety needs throughout the County. The current surtax is set to expire in 2028 unless the voters approve another 10-year term for this fund.

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Who pays the surtax?

Everyone who makes a purchase at a business where sales tax is applied, pays the half-cent surtax. In Okaloosa County, due to the vibrant tourism industry, more than half of the funds collected in the surtax fund are paid by visitors traveling through the County and through their activities during their stay (hotels, restaurants, retail stores, gas stations, etc).

Click to learn about the voter-approved infrastructure surtax projects.

Where do the generated funds go and how are they spent?

The revenue is divided among cities based on population, with the majority going to Okaloosa County (66.51%). The other municipalities receive allocations based on their population size. Funds must be used for critical infrastructure needs that include public safety improvements, traffic flow improvements, water quality initiatives and can be used to leverage additional funding via grant or partner matches specifically for infrastructure improvements.

Click to learn about the voter-approved infrastructure surtax projects.

Who oversees this fund to ensure it is spent responsibly?

A citizens’ committee oversees project spending to ensure government accountability. Every decision this committee makes must also be reviewed and voted on by the Okaloosa County Board of County Commissioners.

Click to learn about the voter-approved infrastructure surtax projects.

Is the voter-approved infrastructure surtax working?

Yes. It has surpassed expectations since collections began in 2019.

Major successes of the surtax fund include the stabilization of all County-maintained dirt roads, the implementation of the P25, Phase II, 800Mhz radio countywide emergency communication system and the ability to leverage the fund for matching grants to further magnify the benefits for additional infrastructure improvements. The surtax revenue has also played a major role in the construction of the Southwest Crestview Bypass which will improve traffic flow in and around the Crestview area.

Total Surtax Revenue Collected (as of June 9, 2025): $127 million
Total Projects: 56 (active and complete)
Total Completed Projects: 15 (with four additional projects in the substantially completed phase)

Click to learn about the voter-approved infrastructure surtax projects.

What would have happened if we did not have the voter-approved infrastructure surtax?

Without the surtax fund, necessary infrastructure improvements like expanded traffic solutions and public safety improvements would be substantially delayed. Infrastructure would be at risk of failing without a long-term improvement solution placing a greater burden upon the County’s general fund and therefore placing a burden on other County services.

The voter-approved infrastructure has been used to address the ever-present traffic issue in north Okaloosa County. Without this resource, traffic complications would persist beyond the current roadway demands and lead to greater motorist frustrations.

If voters decide to approve this successful fund again, County leadership will use this vital tool to improve traffic issues around the County, including along County-maintained roads near and around State Road 85.

Click to learn about the voter-approved infrastructure surtax projects.