Florida’s highly polarized fight over the state’s biggest proposed property tax overhaul in a generation is intensifying as the Sunshine State barrels into a contentious final stretch before Election Day in November.
Real estate, business and local government interests are lining up on opposite sides of a state constitutional amendment on the November ballot. For now, the opposition holds a lopsided lead in organizing.
The measure would deliver homeowners the largest homestead tax cut in decades. But analysts warn that the negative fiscal drag on cities and counties could be enormous. Local government officials say the amendment may lead to financial ruin for some cities.
Florida voters are considering an amendment that would raise the homestead exemption from $50,000 to $150,000 in 2027, then to $250,000 in 2028, before indexing to inflation. It would also cut the assessment cap on non-homestead property from 10% to 5% a year.
The measure needs 60% voter approval on election day, Nov. 3, to take effect.
Florida’s record growth
Property values soared over the past several years, starting during the COVID-19 pandemic and the record domestic in-migration that followed. Residential single- and multifamily developers started building, and supply has since eased valuation and rent growth.
Gov. Ron DeSantis started tackling the state’s affordability crisis three years ago with the Live Local Act to build more affordable workforce housing.
But homeowners kept seeing their property tax bills rise and wanted relief. DeSantis pushed the substantial increase in the homestead tax exemption through a special legislative session in June, where it passed easily by wide margins in both Republican-controlled chambers.
His stance is that lowering the property tax burden on homeowners would help address affordability.
“Yes, homeowners are going to save some money,” Neil Schiller, managing partner at Florida firm Government Law Group, said in an interview with HousingWire TBD. “The delta between what they’re saving and what they are paying right now is going to be passed on to them in other ways.”
The amendment would have no impact on renters, Rick Porras, chief financial officer for apartment developer and owner Neology Group, told HousingWire TBD.
Porras said dropping the assessment cap is helpful to apartment owners from a future savings standpoint.
“But it’s still going up,” he said. “It helps my operating expense structure.”
Porras said it depends on whether the savings are worth it, or whether the bill simply transfers the costs, or the cuts, to another balance sheet.
“I can’t plan for any savings going forward until we get an idea of how the county is going to make up for the lost revenue,” he said.
The financial stakes for cities and counties
DeSantis and his administration have said that local governments will have to tighten their belts.
“But the counter could also be true,” Ken Johnson, a real estate economist with Ole Miss who previously spent a decade at Florida Atlantic University, told HousingWire TBD. “These cities, municipalities, and counties aren’t going to be able to tighten their budgets enough, and they’re going to have a budget shortfall.”
State economists project a $12 billion annual hit to local governments. Florida TaxWatch estimates cumulative losses near $45.8 billion over five years.
The Florida League of Cities projects that cities could lose nearly 38% of property tax revenue on average if they fully phase out homestead taxes. The Florida Association of Counties warns of losses of up to 35% in some counties.
To make up for lost revenue, local governments may raise stormwater and solid-waste fees, introduce new park and permit charges, increase impact fees on new development or raise millage rates on rental and commercial property.
Local government officials warn that vital services could be pared, or worse.
Joseph Abruzzo, administrator of Palm Beach County, the largest by land mass in the state and home of one of the country’s wealthiest cities, said as many as 10 municipalities in the county could become insolvent if the amendment passes.
“The issue is whether these towns would have enough revenue to pay their bills and the debt that they have accumulated over the years,” Abruzzo said at a recent panel discussion sponsored by several homeowners’ associations. “We need to prepare for the possibilities that they will not.”
A quick process raises red flags
Florida TaxWatch, a nonpartisan watchdog group, has raised a different objection, but it fits with a growing question over how the amendment moved to the ballot so quickly.
“We also believe that the entire process behind getting Amendment 3 onto the November ballot was rushed, and did not secure appropriate input from impacted stakeholders,” Florida TaxWatch President and CEO Jeff Kottkamp said during a panel discussion organized by homeowners associations in the county.
He said the group recommends that the issue be referred to the Taxation and Budget Reform Commission, which meets next year.
The measure’s original name nearly mirrored a constitutional amendment voters approved in 1992. That law, Save Our Homes, already limits how much local governments can raise property taxes on homesteaded homes. The overlap has become a flashpoint.
Lawmakers branded the new measure “Save Our Homes From Excessive Property Taxes.” A Leon County judge ruled in early August that the name is misleading because the amendment has no tangible connection to the actual Save Our Homes law.
The judge further ruled that the branding was “not fair or neutral,” calling it “a political slogan,” and ordered a rewrite. Attorney General James Uthmeier issued new language on Aug. 13, retitling it “Increased Homestead Exemption; Lower Cap on Increases in Non-Homestead Property Assessments.”
While the synopsis language was made neutral, Schiller said the ballot language still doesn’t show the potential fiscal harm to city and county services.
“Voters really need to know what they’re voting for,” he said.
A University of North Florida poll in July found that total support fell from 61% to 45% after voters learned about the budget impact.
Opposition more vocal than support
Florida Realtors is the most prominent group backing the measure. Its board voted Aug. 23 to endorse it, calling it an opportunity for “meaningful property tax relief.”
Opposition is broader and more organized. In addition to the Florida League of Cities and the Florida Association of Counties, the Florida Sheriffs Association, the Florida State Fraternal Order of Police, and firefighter groups cite funding uncertainty as a public safety concern.
In addition, the Florida Policy Institute and the national Tax Foundation both warn of distortionary tax shifts. The Florida Democratic Party formally opposes it, calling it “a scam.”
The Florida Chamber of Commerce hasn’t taken a formal position, though it flagged concerns about shifting the tax burden onto non-homesteaded property.
Opponents have organized at least three political committees, including Vote No on 3 and Floridians for Shared Prosperity.
While he urged action with a special session, DeSantis has declined to lead a campaign for the version lawmakers passed. State law also bars him from spending taxpayer money on ballot advocacy. The only funded pro-amendment group identified so far, All Voters Vote Inc., reported $6.1 million in contributions.
Political scientists say that imbalance matters. Ballot measures typically perform better with an organized campaign. With just over two months left, it’s unclear whether a well-funded “yes” push will emerge before early voting begins.
A concerted “yes” effort may not be necessary. Homeowners tend to vote favorably on measures that impact their pocketbook. Turnout could be high in an election that will decide the next governor and a new U.S. Senator.
“I would just be shocked if this doesn’t win,” Johnson said.