On Election Night, Florida voters approved Amendment 3: a sweeping property tax measure that's expected to reduce the amount of property tax revenue cities and counties collect.
Local officials, many of whom warned for months that the measure could be disastrous for government services, now have one year before the amendment hits their budgets to plan how to make up for cuts projected to cost hundreds of millions of dollars.
"For months, we have made clear that the loss of revenue will put significant pressure on public safety, emergency response, transportation and other essential services that our residents count on every day," said Miami-Dade County Mayor Daniella Levine Cava in a statement. "Our work begins today. There will be difficult choices ahead, but our commitment to the people of Miami-Dade County remains unchanged."
The property tax amendment was billed as a way to improve affordability for Florida homeowners by increasing the homestead tax exemption cap on primary residences to $150,000 in 2027 and $250,000 in 2028, with more increases thereafter. The measure also reduces how much assessed value on rental properties can increase each year, and significantly limits how local governments can spend property taxes.
Many cities, counties and towns in Florida rely heavily on property tax to fund services including trash pickup, police, parks and recreation and local libraries. Property taxes account for more than half of the City of Miami's operating budget, and small towns without major industries have budgets almost entirely funded by residential taxes.
In the wake of Amendment 3's passage, attorney Neil Schiller of Broward County-based Government Law Group said governments will need to get more creative about how they drive revenue and deliver services.
"This is really signaling is a new era of municipal government in Florida and how do they provide services, what services are provided to residents, what are their priorities now that funding has to be shifted," Schiller told WLRN.
Schiller represents corporate clients seeking to do business with government entities who see the new shift in property taxes as a golden business opportunity.
" I've been on the phone with clients and many are seeing this as an opportunity, a new sort of day to do business in Florida with local governments," Schiller said. "To that end, I think that local governments who once shunned private industry and private investment into their city are going to think twice and are going to look at these opportunities very, very seriously."
The tax change also signals a moment for the nonprofit sector to step up and plug potential budget holes for local government.
The nonprofit Parks Foundation of Miami-Dade is a fundraising entity for the county's park system. It gathers philanthropic dollars and puts them toward park projects including capital improvements and environmental initiatives.
Ivette Pinto, the foundation's new executive director, said she has already begun courting new and existing donors and making the case for greater donations in the face of Amendment 3.
"Ultimately there will be hard decisions that will have to be made and my job is going to be to figure out how to lessen that burden for the parks department and maintain and try to sustain the level of service, the programmatic needs and everything that the parks department already provides that people have become accustomed to," Pinto told WLRN.
The property tax amendment takes effect in January, but local governments won't begin feeling the budget impact until fiscal year 2027-2028, meaning governments have one year to prepare.
Officials in Miami-Dade County and the City of Miami say they are evaluating their budgets and planning for the potential revenue loss.
Florida Gov. Ron DeSantis has pushed for the Legislature to enter a special session to create an implementation plan for the amendment within the next two months.
"What it'll do is it'll set the schedule for further homestead exemption, because we want people to get that," DeSantis told reporters last week. "But also limiting local governments from just doing an end run around the amendment and taxing them in other ways."
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