The city of Kissimmee plans to maintain a hiring freeze initiated last October as the city continues to “monitor economic conditions,” a city spokesperson confirmed.
The pause comes as local governments across the country, including the city of Orlando and Kissimmee, grapple with ongoing economic pressures such as tariffs.
“If we had a dollar for every time we heard the words tariffs, conflict or recession this year, the City could fund a few additional police officers and firefighters,” a proposed budget for the city of Kissimmee reads. “But those buzzwords are starting to hit home. The cost of government continues to rise.”
Local elected officials are also preparing for ways to weather a potential loss in property tax revenue, if a proposed constitutional amendment on the statewide ballot this fall is approved by Florida voters. The cities of Winter Springs, Orlando and Apopka recently rolled out their own hiring freezes amid the ongoing uncertainty.
“In lieu of doing any position elimination, we’re going to try our best to carry forward with a hiring freeze through the fiscal year, save for those positions that are critical in nature,” said Kissimmee city manager Mike Steigerwald, speaking to city commissioners during a city budget session last week.
The total budget for the city is a proposed $322 million for 2026-27, slightly up from $310 million over the last year. The next fiscal year for the city begins Oct. 1, 2026.
The Central Florida city, like others in the Sunshine State, is taking a closer look at its spending as Florida voters prepare to vote on Amendment 3, a measure on the ballot this fall that seeks to expand the state’s property tax exemption — that is, cut property taxes on primary residences, or homesteads.
If approved by voters, state economists predict Amendment 3 would cost local governments, including cities and counties in Florida like Kissimmee, an estimated $5 billion collectively in the first year, and $12 billion in recurring funds each year after.
About 30 percent of Kissimmee’s general fund is funded by property taxes, according to the city. Losses in revenue could affect funding for essential public services such as public safety, public parks, libraries, infrastructure, and public hospitals.
“With Amendment 3 looming, that’s a major, major hit to our budget,” said Steigerwald, who essentially serves as chief executive officer of city operations. “If it does pass, that’s going to require additional measures that we’re going to have to look at.”
City leaders, even so, discussed a meager 3 percent raise for city employees to help support staff retention — save for Kissimmee police, who are represented by a union, and thus have the power to collectively negotiate with the city for a better deal.
“Likely, that will be a higher increase [for police] in order to keep pace with the salaries that the sheriff and St. Cloud are negotiating at this time,” Steigerwald acknowledged.
Some city commissioners pointed out that a 3 percent raise isn’t going to meaningfully show up in city employees’ paychecks, and asked about alternative options.
“Three percent is probably what? Maybe over the course of a year, maybe an extra — I’m speaking hypothetically, this might not be the exact figure — it may be an extra grand. It could be less than that, it could be a little bit more,” said commissioner Angela Eady. “Why not just give them a one time-payout and then freeze their salary?” she asked. “At least they’ll be able to see the one-time payout.”
“We’re in a situation right now, and I’m talking about countrywide, where people are really struggling.”
“We’re in a situation right now, and I’m talking about countrywide, where people are really struggling”
Kissimmee city commissioner Angela Eady
Others, however, pointed out that a one-time payout could cause wage compression issues, where the payout disproportionately benefits some, while doing less for others.
“With the uncertainty of the economy and the Amendment 3 issue, I would say, well, maybe we could do a 3 percent and then do a one-time bonus that is equivalent to an additional percent,” Steigerwald suggested.
Kissimmee Mayor Jackie Espinosa — who recently dodged potential impeachment by fellow city leaders over alleged ethics violations — asked city staff to do further analysis on the wage issue.
She noted that, during the Great Recession of 2008, the city saw significant compression issues because they had frozen wages and only offered bonuses to help employees get by.
“It’s just very, very tricky to do it that way,” she said. But wages aren’t the only strain. According to budget documents, increased healthcare costs and pensions have also stretched the city’s budget for staff.
“This year’s pension and health care increases dealt a huge blow to the budget increasing 20% and 13% respectively,” the budget proposal reads. “These increases caused us to reevaluate many new long-term plans for additional positions.”
There are other ways the city is looking to cut costs. Kissimmee leaders also discussed limiting their available funding for out-of-state travel, for instance, which is used for excursions such as government conferences or business conventions. Some asked for nuance.
“I don’t have an issue with the out-of-state travel for the commissioners, but I think that every item should be brought to the board so that we can evaluate and make sure that it is something that is going to benefit the city,” said city commissioner Janette Martinez.
She cited meetings of the Florida League of Cities — a statewide association of city leaders — and the National League of Cities as examples of productive trips for commissioners. “These are courses and things that help us gather information and also educate ourselves on new things that other cities are doing that are implemented or not working for them,” she argued.
The city’s theme for this year’s budget is “Propel Kissimmee.” But Steigerwald admitted it took city staff some work to nail down a budget that, in his words, will “move the city forward.”
“Originally, I was going to call it ‘Survival’ because I really didn’t think that we were going to be able to do much in this budget to balance it,” he said (joked?).
“The good news is, is through the hard work of the departments and the finance and budget team, we were able to get to a place that we’re able to propel the city forward in meeting your objectives as a Commission, and pursuing those initiatives and projects that are important to move the city forward, while at the same time ensuring that the city budget is well within the means of our revenue streams that are before us.”
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