Local Government / Tallahassee

Lawmakers Send Sweeping Homestead Tax Cut to November Ballot

Mayor Reeves warns Pensacola could lose $6.4 million a year—enough to wipe out all 95 parks, all 11 community centers, and still not break even.

Florida lawmakers approved a sweeping homestead property tax exemption Tuesday, sending a constitutional amendment to the November ballot that Gov. Ron DeSantis has pushed as the centerpiece of his tax relief agenda. If voters approve it with the required 60 percent supermajority, the measure would reshape how local governments across the state are funded—and in Pensacola, Mayor D.C. Reeves says the math is stark.

What the Amendment Does

Under HJR 1F, the existing $50,000 homestead exemption would climb to $150,000 in 2027 and $250,000 in 2028. The exemption does not apply to school taxes—a change Republicans made Monday to shield school districts from the worst of the revenue hit.

The measure would also cap annual assessment increases on non-homestead properties—vacation homes, investment properties, and commercial real estate—at 5 percent, down from the current 10 percent ceiling.

First-time homebuyers would face a waiting period: starting after Jan. 1, 2027, they would need five years of Florida residency to qualify for the new super-exemption. Until they hit that threshold, they’d receive only the existing tiered exemption.

Statewide, the measure is projected to cut local government revenue by more than $8.4 billion a year.

The Vote

The House passed the measure 75–26; the Senate followed 30–9. Both votes fell mostly along party lines, though three Democrats—Sens. Mack Bernard of West Palm Beach, Daryl Rouson of St. Petersburg, and Barbara Sharief of Miramar—crossed over to vote yes.

• Two Republicans voted no: Rep. Nathan Boyles of Baker and Rep. Patt Maney of Shalimar.

Senate Appropriations Chairman Ed Hooper, R-Clearwater, who is retiring this year, captured the mood for many members before casting his yes vote. “This issue has created heartburn for me from day one, because I’m getting it from both sides,” Hooper said, noting he received 27 text messages from local officials and constituents during the debate alone.

“When the bill comes due, it won’t be paid by Tallahassee. It will be paid by your city, your county, your neighborhood school, your library, your community. This proposal does not eliminate costs, it simply moves them. It is not tax relief, it is a tax shift.”
—Sen. Lavon Bracy Davis, D-Ocoee

What Pensacola Stands to Lose

Mayor Reeves addressed the amendment Tuesday morning at his regular press conference, before the final legislative votes, laying out what a $250,000 exemption would mean for the city’s finances.

• 72% of homes in Pensacola have a taxable value at or below $250,000—meaning they would owe zero city property tax under the new exemption. (Because of Florida’s Save Our Homes cap, taxable values often trail actual market values significantly.)
• The projected hit to Pensacola’s general fund: $6.4 million per year—roughly $4 million in year one and $2.4 million in year two, based on current tax rolls.
• 60% of the general fund already goes to public safety—police and fire. Property tax is the single largest revenue source feeding that fund.

Reeves put the $6.4 million figure in concrete terms. The city’s entire budget to staff and operate all 11 community centers is $2.8 million. The normal landscaping and upkeep budget for all 95 city parks—not counting repairs, just routine maintenance—is $1.3 million. Together, that’s $4.1 million. The city’s stormwater program runs $2.7 million; street lighting and intersections account for another $1.4 million.

“All maintenance of 95 parks, all operations of community centers is about that amount that we would lose instantly.”
—Mayor D.C. Reeves

No Easy Offsets

Reeves was direct about the limits on local government’s ability to compensate for the loss. State law already restricts the types of replacement revenue cities can pursue. “There isn’t a lever that a local government” can pull to replace property tax dollar-for-dollar, he said, pushing back on the suggestion that alternative fees or charges could fill the gap.

• He wonders what happens to CRA bond obligations pledged against future property tax revenue? Pensacola has outstanding bonds from 2017 and 2019 backed by CRA tax increment financing. If the exemption eliminates the property tax base those bonds rely on, the city—and potentially the financial institutions holding those bonds—face an unresolved legal question.

“We would have a bond payment due, and we would not have property tax to then pay that bond,” Reeves said. “Where does that put us with banks? Where does that put banks with the state of Florida? I don’t know.”

A Debate About Escrow, Not Just Exemptions

Reeves also used his press conference to address what he called persistent public confusion about property taxes. Many residents who believe their homestead taxes have skyrocketed are actually seeing their escrow payments rise because of insurance costs—particularly wind insurance—not because of increases to their assessed tax bill. Under Florida’s Save Our Homes law, homestead assessed values cannot rise more than 3 percent per year.

“Homeowner’s insurance, wind insurance, somehow that sits idly by outside of the conversation, yet there is no control on the increase of wind insurance,” Reeves said. He urged residents to look up their actual tax bill online before drawing conclusions about what has or hasn’t changed.

What Happens Next

The constitutional amendment goes to Florida voters in November 2026. It requires approval by at least 60% of voters to take effect.