"What are we going to do when we run out of revenue?"
— Kit Kitchens, as quoted by The Daily Memphian
The question was raised at Hernando's Board of Aldermen meeting on September 1, 2026, in the middle of what's usually one of the quietest items on a city calendar: adopting next year's budget. The board passed it, then un-passed it, after debate over specific line items. Earlier that same meeting, aldermen had separately passed the fiscal year 2027 property tax rate itself, holding it at 35.76 mills, the same rate Hernando homeowners paid this year. As of the most recent reporting, the tax rate stands. The broader budget document does not yet have the same certainty.
On paper, that sounds like stability. If you're comparing Hernando to Southaven or Olive Branch based on a portal's median price, a flat millage rate reads like a settled number you can plug into a mortgage calculator and move past. The budget discussion provides context for the rate: during the same year, the city addressed a multi-million dollar utility-fund accounting shortfall, and the board briefly reversed its budget vote. Buyers comparing carrying costs can consider those developments alongside the current millage rate.
The Reassessment That Started All of This
In 2025, the Mississippi Department of Revenue directed county assessors statewide to bring property values closer to fair market value. DeSoto County Tax Assessor Jeff Fitch told county supervisors his office had been running assessments at roughly 56 percent of market value and now had to move to at least 85 percent, the state's minimum. That single change pushed taxable values up across every city in the county, whether or not a given home had sold or changed hands.
Cities responded by cutting their millage rates to soften the jump. Hernando's Board of Aldermen cut the city's rate by five mills in August 2025, landing at 35.7654 mills. Olive Branch went further, dropping its rate 8.96 percent to 35.05 mills, which Mayor Ken Adams noted keeps it the lowest municipal rate in DeSoto County. Neither city was chasing extra revenue. Both were trying to keep a state-mandated reassessment from turning into an accidental tax increase.
That's the backdrop for why "flat" matters this year. A flat rate sitting on top of an already-adjusted base is a different signal than a flat rate sitting on top of untouched assessments. The cities had already reduced their rates after the reassessment. Future rate decisions will depend on each city's budget.
How the Cities Compare This Cycle
| City | FY2026-27 Millage | What Changed |
|---|---|---|
| Hernando | 35.76 mills | Held flat, after a 5-mill cut the year before |
| Olive Branch | 35.05 mills | Held flat, after an 8.96% cut the year before |
Southaven and Horn Lake also kept their rates unchanged for the coming fiscal year, according to Daily Memphian reporting from September 3, 2026. Every city in the county looks identical on a rate table right now: no increase. The table does not show the budget context for each city's rate.
What Was Actually Straining the Budget
In February 2026, Mayor Chip Johnson told the Board of Aldermen that Hernando's utility fund was facing a $2.6 million deficit, the product of accounting errors and a waste disposal cost that had climbed 16 percent a year without a matching increase in what the city collected to cover it. Johnson took responsibility for the miscalculation. The board's fix was a trash fee increase from $22 to $28 a month for city utility customers.
That's a utility fund problem, not the general fund the millage rate feeds. But it's the same city government working through the same budget cycle, seven months before the aldermen would sit down to pass the FY27 property tax rate. Kitchens raised the question during the budget discussion.
What This Means If You're Comparing Cities
None of this means Hernando is a risky place to own a home. Plenty of well-run cities have a rough budget year. This year's flat rate is one data point, not a guarantee of future rates. If you're buying with a five- or ten-year hold in mind, consider how possible rate changes could affect carrying costs.
The Other Number Buyers Miss: Assessment Ratio
There's a second mechanic in Mississippi's system worth knowing before you compare a Hernando listing to one elsewhere. Owner-occupied homes in DeSoto County are assessed at 10 percent of true value for tax purposes. Other property, including a home you buy as a rental, is assessed at 15 percent. That's a state-level formula, not a Hernando quirk, but it changes the math meaningfully if you're comparing an owner-occupant's carrying cost against an investor's carrying cost on the same house. A rental bought at the same price as the owner-occupied home next door can carry a noticeably higher tax bill from the assessment ratio alone, before the millage rate even enters the calculation.
If you plan to live in the home, filing for the homestead exemption matters more than the sticker price of the millage rate. DeSoto County's Tax Assessor's Office accepts applications each year in person at the office on Losher Street in Hernando.
A Short Checklist Before You Write an Offer in Hernando
- Ask for the parcel's current assessed value, not just the listing price. The reassessment already happened, so your number should reflect it.
- Confirm whether the property sits inside Hernando's city limits or in unincorporated DeSoto County.
- If you're buying as your primary residence, file for the homestead exemption.
- If you're buying as a rental or investment, run your numbers at the 15 percent assessment ratio, not 10 percent, so your cash flow projection matches the actual bill.
- Keep an eye on the city's budget calendar. Hernando's board meets the first and third Tuesday of most months, and decisions made in one cycle tend to show up on the following year's tax bill.
Frequently Asked Questions
Did Hernando's property taxes go up this year? The city's millage rate did not increase for fiscal year 2026-2027. It was held at 35.76 mills, the same rate set after a five-mill cut in August 2025. Whether an individual bill rises depends on that property's assessed value, which can change independent of the rate.
What is a mill, in plain terms? One mill equals one dollar of tax for every one thousand dollars of a property's assessed value, not its market value. A homestead exemption and the 10 percent assessment ratio for owner-occupied homes both apply before the millage rate calculates the bill.
Does the utility fund shortfall affect my property tax bill? Not directly. The $2.6 million utility fund deficit and the resulting trash fee increase are billed separately from property taxes. The connection is timing and capacity: the same board managing that shortfall is the one setting the millage rate, and both issues surfaced in the same budget year.
Numbers like these are exactly why a median price on a listing page only tells part of the story. If you're weighing Hernando against another DeSoto County suburb and want someone who reads the budget minutes as closely as the MLS sheet, Chad and Deanna Wardlaw at Move With Wow work this market every week. Schedule a consultation and we'll walk through what a specific address's tax history actually looks like, not just what the county average suggests.
This article is general information, not legal, tax or financial advice. Consult a qualified professional about your situation.
