Nicole Fox, a policy analyst with the Tax Foundation, said the Florida property tax measure does not amount to tax relief.
A Leon County lawsuit is challenging a November ballot measure to reduce property taxes, alleging that its summary ballot language violates Florida constitutional requirements and misleads voters about what the measure would do.
Filed in the Second Judicial Circuit Court on June 11, the lawsuit contends the measure’s ballot language is “unconstitutionally biased, misleading and improper.” The ballot measure – House Joint Resolution 1-F – emerged from a legislative special session on June 2 and was subsequently signed by Gov. Ron DeSantis.
But the measure must win voter approval by at least a 60% margin in the fall election to take effect. Supporters say it would benefit Florida families by increasing the state’s homestead exemption for current homeowners from $50,000 to $150,000 next year and to $250,000 by 2028.
The proposed constitutional amendment does not apply to property taxes collected by school boards, but critics say it would put billions of dollars now going to local services at risk, including revenues for libraries, emergency medical care, and police and fire services.
The lawsuit, however, takes aim at the proposed amendment’s ballot statement, alleging that its title – “Save our homes from excessive property taxes” – and other phrases saying the amendment “benefits Florida taxpayers” and protects small businesses amount to sloganeering rather than neutral descriptions of the measure’s provisions.
The ballot summary also tells voters that the measure “requires, through general law, a schedule for full elimination” of the property tax, but the lawsuit argues the measure does not require “full elimination.”
The complaint, which was filed by Save Our Voters From Misleading Ballot Language Inc. and two Florida voters, seeks a court declaration that the proposed ballot summary is “misleading and materially false.”
“Plaintiffs recognize the great importance of property tax reform, and understand the Legislature’s zeal to enact changes as quickly as possible,” the lawsuit states. “However, on an issue as important as this, voters are entitled to a fair, clear, accurate and nonmisleading ballot statement to assist them in making this critical decision.”
The property tax measure has faced criticisms not just in the civil justice system but from tax policy groups, including the Florida Policy Institute and the Washington, D.C.-based Tax Foundation, as well as credit rating agencies such as Fitch Ratings.
Nicole Fox, a policy analyst with the Tax Foundation, said the fiscal impact on Florida local governments once the homestead exemption hits $250,000 will be $8.4 billion. Homestead property accounts for 36.1% of real property value in Florida, according to Fox.
“... Because the cost of providing local government services cannot be eliminated, the lost government revenue will be made up elsewhere,” she told the Florida Record in an email. “This creates a strong likelihood that remaining taxable properties will face higher millage rates. It also raises the possibility of increased reliance on other revenue sources, including the sales tax.”
Millage rates refer to the amount of a property levy charged per $1,000 of its assessed value.
The Florida ballot measure cannot be considered tax relief, according to Fox.
“It is simply a shift of the tax burden to other property owners and to other revenue sources,” she said. “Eliminating school property taxes from the tax base would only intensify this shift and result in even greater pressure on alternative revenue sources.”
The measure would also limit tax increases on non-residential property from the current 10% annually down to 5% in order to ensure local governments do not attempt to pass on the cost of homestead tax relief to business owners, according to supporters.
Fitch Ratings reported that if approved by voters, the measure could put credit pressures on local governments.
“The amendment will lead to a reduction in taxable assessed values and property tax revenue, which will increase fiscal uncertainty unless policymakers take offsetting action,” the credit rating agency reported.
