Cape Coral City Council heard a detailed presentation Wednesday on the possible fiscal impacts on the city if state legislators’ call for tax relief gets passed.

The overall message to the council was there would have to be a reduction in services if the revenue is not replaced.

Led by Gov. Ron DeSantis, state reps are bringing forward a number of possible proposals to reduce or eliminate ad valorem property taxes, the primary source of funding for municipal, county and school board budgets.

Any plans passed this legislative session would have to be placed on the ballot and approved by the voters before implementation.

The presentation took council members through the variety of bills that have been introduced that could reduce, or eliminate homestead taxable value and small business taxable value, as well as the impact on the city if passed.

Assistant City Manager Mark Mason said there have been 22 bills filed to date.

“All of them have something to do with property taxes in one form or another,” he said. “Some have very minimal affect to us, and some have more significant effects on us depending on what occurs by voters.”

The city has 61,599 homesteaded properties out of the 138,659 properties that represent $12,611,391,993 of the city’s taxable values. At the current millage rate of 5.1471, the homestead property tax revenue makes up $62,315,612.

Currently, the annual assessed value of owner-occupied properties increases are capped at 3%, while non-homesteaded property is capped at 10%.

Possible revenue solutions at the city level depend on how they replace whatever is taken away, Mason said. If something is taken away, the city can cut the expense and align its budget to meet whatever revenue source is available to pay for the service at whatever service level the city is looking to achieve.

Solutions could include increasing the fire service assessment cost recovery from 81% to 100%, implementing additional 3% public service tax and a one-time ad valorem tax rate increase.

“At the same time, we were kind of hoping the state would come up with a solution on sales tax. However, they did not file one for municipalities. They did file one for county and school districts,” Mason said.

Scenarios presented ranged with severe cuts on how the city operates, to minimal impacts.

The House Joint Resolution 201: the elimination of non-school homestead property taxes, would result in a loss of revenue of $62,315,612. This assumes no revenue replacement from the state.

With the loss of revenue, administration, code enforcement, transportation, parks and recreation and fire would be impacted severely.

Among the proposals with minimal impact is House Bill 393, which would remove assessed value restrictions for surviving spouses of permanently and totally disabled veterans and allow surviving spouses to carry their exemption to another jurisdiction.

Mason’s recommendation was to continue to monitor these bills through the legislature. He said House Joint Resolution 209 – increase the exemption for homestead property by $200,000 for properties that have property insurance — is  already on the second reading for the House and is expected to pass the House this week then go to the Senate.

There will be further discussion at the January budget workshop.

Many of the council members said there needs to be a community awareness campaign, so residents are educated now about all the bills and what kind of ramifications come from the passing of them.

“People, I think, need to understand what this could look like for our city in any way we can without instilling panic,” Councilmember Jennifer Nelson-Lastra said.

To reach MEGHAN BRADBURY , please email news@breezenewspapers.com