Q&A of the Day – Florida’s Current Proposals to Reduce or Eliminate Property Taxes
Each day I feature a listener question sent by one of these methods.
Email: brianmudd@iheartmedia.com
Social: @brianmuddradio
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Today’s entry: Hi Brian, one of the criticisms I’ve heard about the DeSantis plan to eliminate property taxes is that he hasn’t produced a proposal and that he’s only talked about it. Is this true and also what is the current plan?
Bottom Line: Without a doubt property taxes are the top issue on the minds of Floridians surrounding this year’s state legislative session due to Governor DeSantis’ firm push for the eradication of homesteaded property taxes this year. It’s actually a topic he first brought up prior to the start of last year’s session spending much of the past year investigating the viability of delivering the highest impact property tax relief possible. He has now illustrated that it is possible to eliminate homesteaded property taxes in the state of Florida without the elimination of any essential services and without an increase in sales tax. So quickly...about that prior to diving into next steps with your question.
I conducted multiple analyses last year in addition to studying analysis from the James Madison Institute and Florida TaxWatch. The brass tax takeaways were these:
- Homesteaded property taxes only makeup approximately 15% of larger county revenues and 30% of smaller county revenues
- If local governments simply were to operate at the size they did prior to the pandemic (2019), homesteaded property taxes could be eliminated without any offsets being needed on average
- 34 rural counties would be the most negatively impacted and would not be able to eliminate homestead property taxes without offsets
The summation is like this... Local governments have raked in massive windfalls of pandemic-era money in addition to surging revenues from Florida’s best-in-the-nation property appreciation post-pandemic. Rather than operating governments similarly to how they’d been operated prior to the pandemic, local governments spent the additional resources growing local governments well past the point of population growth. Something Florida’s local governments have a long history of doing. As previously illustrated...
Since 2000, Florida’s population growth has been 116%. During that same time property tax revenue collection has risen by a staggering 370%. In other words, property taxes have risen at greater than 3x the rate of population growth, showing that if local governments have the ability to collect higher than needed property taxes, local governments WILL collect higher than needed property taxes. In other words, this started well before the pandemic, however it continued to accelerate after it.
To further illustrate the point about the extent to which local governments have grown well in excess of any justifiable measure – in addition to property taxes having risen by 370% since 2000 – despite a population that’s only 116% higher – the typical property has appreciated by 310% during the same time. In other words, tax collections have risen by 60% more than even property prices. This takes us to today’s question(s).
The reason you likely have heard concerns raised about Governor DeSantis having not produced a plan is due to House Speaker Daniel Perez having recently said this: In order to pass a law that has to do with property taxes, the Governor first has to have a proposal on property taxes. If the Governor has a proposal and it’s something we can agree on, then we’re ready today.
To Perez’s point Governor DeSantis hasn’t produced a bill, a function of the legislature that can be considered and voted on. However, he has outlined his agenda so that the legislature can propose and consider it. He outlined it in the phases:
1. Immediate Property Tax Relief for Homeowners
DeSantis has been pushing for immediate relief for homesteaded homeowners — those living in their primary residences. His core idea here includes:
- One-time rebates averaging about $1,000 per homesteaded property, intended to cut this year’s property tax burden.
- These rebates would be paid by the state using budget surplus/reserves, mainly by rolling back the Required Local Effort (the state-mandated portion of school property taxes) to zero and providing a rebate.
2. Constitutional Amendment on the 2026 Ballot
- DeSantis wants one clear amendment on the ballot (not many competing ones) to improve chances of passage. His proposal is the elimination of homesteaded property taxes.
3. Addressing Funding Gaps
- Backfill smaller counties’ revenue losses through allocations in his budget, ensuring they don’t lose essential funding.
- If needed - shift more of the tax burden to tourists, visitors, and non-residents via sales taxes instead of property taxes.
As DeSantis has said the 34 rural counties that would need state help could be addressed with less than $500 million annually or what he called “budget dust”. While he doesn’t believe that sales tax increases would be needed (and he’s right), his preference at the local level if governments insist on higher funding would be through raising taxes that impact visitors as opposed to residents the most.
As for where we stand...
The state legislature proposed eight different proposed amendments for consideration during this session (none that called for a total property tax elimination). Of those eight, four have advanced in multiple committees and are currently under serious consideration by the legislature:
Would establish a homestead exemption for all non-school property taxes while mandating local governments to maintain at least current levels of funding for law enforcement.
Would exempt homesteaded residents 65 and over from paying non-school taxes on their homes while mandating local governments to maintain at least current levels of funding for law enforcement.
Would increase homestead exemptions for non-school property taxes by $100,000 if the property is subject to a comprehensive insurance policy while mandating local governments to maintain at least current levels of funding for law enforcement.
- Accrued Save-Our-Home Property Tax Benefit for Non-School Property Tax
Would allow the full value of the accrued benefit on homestead property tax assessments to be transferred to a new homestead for non-school levies while mandating local governments to maintain at least current levels of funding for law enforcement.
So those are the four proposals. I’ll keep you posted on what happens from here.