Tuesday, the commission voted unanimously to enter into mediation with Panama City Beach over its two Community Redevelopment Areas (CRAs).
Panama City Beach is currently getting the property tax revenue generated from growth in both the Front Beach Road and Pier Park CRAs.
The county is getting only the same property tax levy set before the CRAs were established four years ago.
Bay County officials say the area has changed from mom and pop small motels to multi-million dollar condos and they need more money to provide services to those people.
The county must mediate before it can sue the city over the issue.