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Could Taxes in Niceville Go Up Next Year? Here’s what city leadership says and their plans for the future. 

Niceville City Manager David Deitch had a long week. In addition to two budget hearings on August 15th and 17th – Deitch co-hosted a town hall in the chrome-bedecked halls of the Senior Center with Niceville Mayor Daniel Henkel. In his two months on the job, Deitch has devoted many extra hours with his department heads to figure out a budget that gets the job done for residents and attempts to not raise taxes on them. 

I attended all three events, so you didn’t have to. Here’s what I learned about the direction of the city and what it means for you. 

Raising Taxes In Niceville? City Leaders Are Discussing It. Here's Where They Would Spend It.

Deitch hinted a tax increase might come this year. 

Bob Steele, a Niceville resident, asked Deitch what he would do if an extra $1 Million landed in the city coffers tomorrow.

two men, one man stands at a podium.
City Manager David Deitch and Mayor Daniel Henkel speak to the Niceville Senior Center at their town hall on Thursday.

“I would go back to whoever gave me a million dollars and say I need about 10 more,” Deitch said. He added that, if he could, he would raise his ‘teammates,’ employees at the city, pay. ” My teammates are out there working hard every single day to take good care of this community. And they are are underpaid.”

Two days earlier – at the city’s initial budget hearing – Deitch was more explicit about the potential tax increase citizens could see. 

Significant transfers of reserves would need to be used to balance the budget while keeping government services at certain levels. “We are currently looking at a budget of about $61 Million for the city of Niceville,” Deitch told a gathering of residents at his first Coffee with the Mayor and City Manager on August 17th, “It’s bumpy and ugly, but that’s what we’re working with.”

The council and Deitch discussed how much extra revenue they could bring in with an increase of up to .3 mills to 4.0000. That increase would bring an additional $479,000 to the city’s coffers. 

Deitch himself mentioned the numbers 3.77 and 3.8. An increase of .07 mills on a $500,000 home with a homestead exemption would cost a homeowner roughly $35 per year in extra property taxes. A jump to 3.8 would cost about $50 per year. 

What's New in Niceville's City Budget This Year?

The City of Niceville currently has the second-lowest property tax rate in Okaloosa County. The high property values in Destin help keep their property tax rate significantly lower than every other city in the County. 

The budget makes a couple of considerations, including pay raises for Police (5%) and all other positions (3%). Pay negotiations will start with the fire department employees, who are in a union, in September. 

Additionally, the budget adds a full-time position to the senior center to stay open later, a part-time job for the children’s park so that it can remain open seven days per week, and a public information officer. A Public Information Officer (PIO) is tasked with communicating what is going on in government to residents and communicating what residents are saying back to the government. Think of them as a government public relations person. 

Deitch said other large new budget items include design plans for a new public safety complex (half a million dollars), money for strategic planning, and a $5 million loan to build the new government complex, which the city would break ground on in the next nine months, meaning construction would begin May 2024. 

The proposed government complex would total about 9,000 square feet – roughly double the space the city offices have now. This building would include a place for council chambers, the human resources function, and building management and would serve as a one-stop shop for citizens who have business with the government. 

The $5 million loan the city would take out to cover the cost of the building would put the city government at about $14 million in debt. About $7 million of the city’s debt is associated with the water and sewer department. 

Councilman Sal Nodjomian told Deitch that he wanted to begin focusing on debt retirement in the next budget cycle. 

A Sanitation Shortfall and what it might cost you.

Niceville has a serious financial problem with its sanitation fund. The fund pays for the Waste Management contract (trash and recycling pickup once per week) and pays for the city-run bulk pickup service. The bulk pickup white truck has a city logo and a large orange crane on the back. That second function is what has cost the city financial headaches. The city has had to move $541,000 from reserves to cover the shortfall projected from this coming year’s budget. “The sanitation enterprise fund is woefully underfunded,” Deitch said, “both for operating costs and for revenues. So, we are actively researching options that have to shore up this fund.” He also mentioned they were looking at outsourcing the whole bulk pickup operation.

The City Manager and Public Works Director, Jonathan Laird, say residents have put out so much extra bulk trash in recent years it will require changes, including a weekly limit of 40 cubic yards (or two grabs of the crane). City Manager Deitch said he was considering a per-pickup solution for large amounts of bulk trash in the city. “I anticipate sometime in the near future, we’re still doing our homework and running the numbers, but I will be coming back to you for a rate increase for the bulk of a couple of dollars per month for residents.”

The additional budget woes were made worse by the vast bulk that needed to be picked up. According to Laird, about seven months ago, there was so much volume that the city was forced to ask WM (Waste Management) for help. WM came to the rescue at a rate of $250 per hour – a number that Deputy City Manager Chad Morris called “A bit pricey compared to what we’re paying, but reasonable.”

Looking to the future

In addition to the present year’s budget, the city manager and his staff say they want to peer further into what will come and plan for the future they want to see. Deitch mentioned he repeatedly asks his teammates what they think the city will look like in 2033. He hopes to have a massive strategic planning session with community input in the first quarter 2024.

In the meantime – the city wants to address other issues residents have now, especially regarding housing, traffic, and a downtown.


Citizens who attended the town hall on Thursday were apprehensive about the lack of affordable housing in the area and the increase in new residents coming from the Deer Moss Creek Development on the east side of town.

Deitch and Henkel told the roughly 50 residents who attended the morning meeting they had a plan with two prongs:

Affordable Housing

As they sipped Coffee and munched on donuts and chicken biscuits and listened in quiet focus, Deitch told residents he’d begun working on this problem while he was still general counsel to the 96 Test Wing on Eglin Air Force Base. 

The Air Force, he says, recognizes the problem with finding affordable housing in Niceville and wants to seek a solution with the city. 

Deitch told the attendees they have a site to add 1,200 attainable homes on the piece of land between The Mullet Fairgrounds and Northwest Florida State College. 

This property, currently owned by the Air Force, would be developed and sold to working-class people. “Most of my cops, my public works folks, my firemen can’t afford to live in Niceville,” Deitch commiserated. He added the city would work to put deed restrictions on the homes so that “people will be able to buy affordable housing, grow in it, and then, sell it into the future for the same community.” He added that portions of the housing inventory on this land would be set aside expressly for military members, civil and public servants. “We need to provide affordable homes for those who serve us daily but can’t afford to live in this community.”

Deer Moss Creek

Everyone wants to talk about Deer Mos Creek. The 3500-home development on the city’s eastern side will bring in about 10,000 residents, a 60% increase in population over the next several years. Residents worried about the stress it would put on the roads, schools, and other services. “The city is actively working on several different long-term strategic projects to get after that, whether it’s water and sewer or schools,” Deitch said.

Inspections and Code Enforcement

The change in leadership in the City Manager’s office has also meant a reorganization of the building permits and code enforcement offices. Deitch reported to the council the city now contracted its services through Okaloosa County. “For fiscal reasons, I eliminated our code enforcer/building inspector position,” Deitch said. He added that he was paying Scott and Bob McElroy, another building inspector, a total of $91,000 per year. The temporary solution, with the County, costs $60 per inspection.

An Olympic-Sized Project

This summer, Niceville’s elected officials endorsed an idea to build a “world-class aquatics facility” somewhere in the city of Niceville. Officials have not selected a piece of land for this facility – but don’t let that fool you. The social media rumor mill has confirmed that the facility will be in one of many places around the city. 

Nearby cities and counties have endorsed the idea, and the city has worked to get other agencies and groups on board to support the plan financially. No location has been named the future site of the facility. In addition to those cities – Northwest Florida State College, 7th Special Forces, and The EOD School have come out in support of the idea, according to the city manager, and have plans to make use of and support it in the future. “Doc Stephenson from [Northwest Florida State College is] interested in expanding his occupational therapy and physical therapy programs, and they can take advantage of that facility,” Deitch said, “and, of course, opening it up to all of you for memberships and classes to do exercise programs for everyone in the community.” The finished facility is still years away, according to the city manager. Still, the city has begun conversations with County Commissioners, State and Federal representatives to get support for the facility’s construction. 

At the town hall meeting on Thursday – Deitch mentioned that the city could expect to see splash pads for little kids in addition to the swimming and diving facilities.  

Downtown? Where?

Mayor Daniel Henkel’s official city page mentioned his desire to fully develop a downtown-style area on Bayshore Drive near Blue Collar Café. He still holds that conviction if Thursday’s town hall is any indicator. It’s also one this site happens to support—so, bias alert. 

City Manager Deitch appears to support the mission as well. “It’s going to be a walkable, old downtown kind of area with little shops, little restaurants and such things like that,” Deitch said. He added the city wants to build an amphitheater and a pier to complement the downtown and generate tourism as a part of the buildout.

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