Lazaro Aleman
Riverbend News
Two property tax bills that legislators passed in the last special session and that Gov. Ron DeSantis recently signed into law will significantly impact local governments’ ability to raise property taxes going forward.
The governor signed into law Senate Bill 4- F, titled Property Tax Administration, and House Bill 1329, titled Local Government Finances, on Wednesday, June 24.
Unlike the proposed amendment that lawmakers passed in the same session to lower residential and commercial property taxes by increasing the homestead exemption and reducing the cap on non-homestead properties, SB 4-F and HB 1329 do not require voter approval.
SB 4-F, in fact, went into effect immediately upon the governor’s signature, and HB 1329 is set to take effect on Jan. 1, 2027.
Per the governor’s office, SB 4-F is designed to increase transparency, accountability and fiscal discipline in local governments while supporting ongoing efforts to provide property tax relief for Florida homeowners. The legislation revises how local governments calculate the maximum property tax rate that they can adopt. Under current law, local governments may increase the rolled-back rate based on growth in Florida's per-capita personal income.
As Florida Tax Watch explains it, the state’s per-capita personal income is a measure of the year-over-year percentage change in the average income earned by individual Floridians. The metric is calculated by dividing the total statewide personal income by the total population to tracks changes in residents' overall economic well-being and spending capacity.
Considered a key indicator of economic health and growth, the metric reflects whether individual earning power is rising faster than the population. Historically, Florida law has allowed local governments to use the growth of the per-capita personal income to increase property tax millage rates up to a certain threshold with a simple majority vote.
SB 4-F removes this adjustment by restricting local governments from using the metric as a reason to automatically increase property tax rates.
The new law also establishes higher approval thresholds that local governments must meet to exceed the rolled-back rate, a value that is calculated to generate the same property tax revenue as the previous year by taking into account increases or decreases in property values during the intervening year and adjusting the rate accordingly.
Per the new law, local governments can no longer advertise a millage rate higher than the rolled-back rate with a simple majority vote. Instead, it now requires a two-thirds vote of the governing body to raise the millage rate up to 110% of the rolled-back rate.
Further, it will require a unanimous vote – or a three-fourths vote for larger governing bodies – to raise the millage rate above 110% of the rolled-back rate.
Local government’s other option to raise the millage rate above 110% of the rolled-back rate, per the new law, is to seek voter approval via a referendum.
SB 4-F also serves as an implementation measure for the property tax amendment that will be on the November ballot by authorizing the amendment’s ballot summary to exceed the usual established word limit. If approved by 60% of Florida voters in November, the amendment would increase the homestead exemption from the current $50,000 to $150,000 in 2027 and $250,000 in 2028, among other things.
The intent of SB 4-F, according to its proponents, is to limit local government’s ability to increase property taxes via the millage rate without broad public support.
“Local governments have continued to grow their budgets by resorting to scare tactics like threatening cuts to essential services,” Florida Chief Financial Officer Blaise Ingoglia is quoted saying of the new law in the governor’s press release. “This pivotal piece of legislation pulls the curtain back on local government’s wasteful spending so that Floridians are better equipped to hold their local officials accountable.”
HB 1329, meanwhile, requires that local governments post tentative or final budgets on their official websites.
Per the bill, the information provided to the public must be downloadable; address the proposed, current and previous four fiscal years’ budgets; and contain such details as a budget overview and summary, an overall summary of the public entity’s revenue and expenditures, and summaries of expenses by departments or programs and those related to debt obligations.
The bill further requires that budget officers hold budget-cutting exercises at least 14 days prior to the final budget adoption.
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