A proposed constitutional amendment that could dramatically reduce property taxes for Florida homeowners is also raising questions about how local governments would make up the lost revenue.<\/p>\n
The proposal would increase Florida\u2019s homestead exemption to as much as $250,000 by 2028. Supporters say the change could save homeowners hundreds or even thousands of dollars a year, while critics warn it could create significant budget shortfalls for cities and counties that rely heavily on property tax revenue.<\/p>\n
A homeowner with a house assessed at $350,000 currently pays taxes on roughly $300,000 of that value after homestead exemptions. If voters approve the amendment, that taxable value could drop to around $100,000. But county and city leaders are already questioning how governments would absorb the millions of dollars in revenue losses that could follow.<\/p>\n
\u201cThe budget is the budget. You know what you need to pay,\u201d Orange County Property Appraiser Amy Mercado told Channel 9. \u201cIf you\u2019re not receiving income to pay those bills, then you need to figure out what else you can use as a source of income.\u201d<\/p>\n
Could local governments simply assess homes at higher values? The short answer is yes \u2014 but there are limits.<\/p>\n
For homeowners with a homestead exemption, Florida\u2019s Save Our Homes law caps annual increases in assessed value at 3% or the rate of inflation, whichever is lower.<\/p>\n
That means if a home\u2019s market value increases by 15%, its assessed value cannot jump by the same amount for tax purposes. It is a cap that is in the Florida Constitution.<\/p>\n
Could cities and counties raise other taxes or fees? Potentially.<\/p>\n
Mercado said local governments could look at other options to recover lost revenue, including raising millage rates, although those increases are limited by law.<\/p>\n
\u201cWhether that\u2019s increasing the millage to offset some of the loss, that\u2019s possible, but the millage can only go up by so much,\u201d Mercado said.<\/p>\n
Municipalities could also consider special assessments, utility fee increases, or other local revenue sources depending on their financial needs and governing rules.<\/p>\n
What protections would homeowners have?<\/p>\n
Channel 9 asked state lawmakers supporting the amendment whether there are safeguards in place if local governments attempt to offset property tax reductions through new fees or other charges.<\/p>\n
State Sen. Jason Brodeur said lawmakers intend to closely monitor the issue.<\/p>\n
\u201cWe\u2019re going to be watching to make sure that there isn\u2019t a lot of that cost shifting going on,\u201d Brodeur said.<\/p>\n
\u201cPart of this also is continuing to adjust this. This is not a finished product,\u201d said Lt. Gov. Jay Collins said. \u201cYou\u2019re going to have to continue to legislate.\u201d<\/p>\n
The proposed amendment is set to appear on Florida\u2019s November ballot. Because it is a constitutional amendment, it would need approval from at least 60% of voters to pass.<\/p>\n
The Lt. Gov and Sen. Brodeur both acknowledged smaller municipalities could be impacted hardest, but there is grant funding available to fill the gaps.<\/p>\n
Click here<\/a> to download our free news, weather and smart TV apps. And click here<\/a> to stream Channel 9 Eyewitness News live.<\/p>\n
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