Update: The property tax proposal that actually passed late last week doesn’t phase out the exemption. It goes into effect immediately on Jan. 1, 2027, so the hit for the City of Pensacola could be $8.9 million in 2027. The Pensacola City Council will discuss this today.
The Florida House has passed sweeping changes to property taxes that could dramatically reshape how local government is funded. The City of Pensacola has estimated $8.9 million loss in revenue over 10 years.
House Joint Resolution 203 proposes amending the Florida Constitution to phase out nearly all non-school property taxes on homestead properties over the next decade. If approved by 60 percent of voters in the November 2026 general election, the change would take effect January 1, 2027.
Here’s how it works: Currently, homeowners receive a $25,000 homestead exemption on the first portion of their property’s assessed value, plus a second exemption that applies to the portion between $50,000 and $75,000 (adjusted for inflation).
HJR 203 would add $100,000 per year to that second exemption for ten years. By 2037, homestead properties would be completely exempt from all non-school ad valorem taxes — meaning county government, city government, water management districts, and other local taxing authorities would receive nothing from homeowners.
- By the numbers: Florida House staff estimates the amendment would hit local governments with a $4.8 billion negative cash impact in Fiscal Year 2027-28 alone, growing to a $14.7 billion recurring annual impact — and that figure keeps climbing each year of the phase-out period, eventually surpassing $14.7 billion once the full exemption kicks in after 2037.
To address concerns that local governments might gut public safety funding to cope with the revenue losses, HJR 203 includes a constitutional floor: counties and cities would be prohibited from reducing funding for law enforcement, firefighters, and first responders below whichever is higher — their FY 2025-26 or FY 2026-27 appropriation levels.
This is what the mayor’s office will represent to the Pensacola City Council today:
Estimated Loss of Revenue Annually
| Year | |
| 1 | $ 4,082,992.74 |
| 2 | $ 2,122,742.62 |
| 3 | $ 1,052,140.17 |
| 4 | $ 533,263.54 |
| 5 | $ 301,092.20 |
| 6 | $ 192,786.26 |
| 7 | $ 126,569.53 |
| 8 | $ 91,804.89 |
| 9 | $ 69,381.53 |
| 10 | $ 368,495.98 |
| Total | $ 8,941,269.46 |
The joint resolution requires a three-fifths vote of both chambers to pass the Legislature and is not subject to the Governor’s veto. That means this decision ultimately lands with Florida voters.
