Risks of the Homestead Exemption Bill and why I'm voting no on Amendment 3

The governor’s initiative, modified by the Legislature and known as Amendment 3, will appear on all statewide ballots this November and will require 60% statewide approval to pass. The ballot description is brief, as required by statute, but it does not accurately define the proposal. The intent is to decrease the real estate tax for Floridians who have homesteaded their residence. The revised initial wording clarifies that public school taxes are exempt from this proposal, thus property taxes will not be eliminated for anyone.

Homesteading does not require full-time occupancy but does require the property to be a permanent residence and significantly restricts rental opportunities. The bill increases the Homestead exemption from $50,000 to $150,000 in 2027 and to $250,000 in 2028, with the possibility that future legislators could eliminate all non-school taxes for some properties, based on their discretion.

The bill does not address the offsets or adverse effects which would follow if enacted. In addition, the bill offers no alternative sources of income to cities to replace the lost revenue supporting multiple city services. The bill is a “one-size-fits-all” approach, disfavoring cities that effectively and efficiently manage their financial resources.

In addition, the legislature passed SBF-4, which the governor signed, further restricting millage rates. This bill also represents a further attack on HOME RULE, a trend that has gained momentum over the past 10 years by continuing to usurp local decision-making in favor of State control.

This ambiguous amendment would also allow future state legislators to eliminate taxes on some homesteaded properties, except for public schools, without clarifying the process or timetable. If enacted, this amendment would shift most funding for city services to commercial and rental income properties, which I believe would not be a fair way to spread the costs of services that benefit everyone.

The bill simply requires all cities to spend less across the board while continuing to provide services, as the costs of doing so continues to rise. Amendment 3 is void of any provisions for replacing lost revenue and would result in each city and county determining which services to cut or which additional assessments or fees to consider adopting to fund the continuation of existing services.

Here are some facts to analyze actual Holmes Beach taxing highlights over the past 5 years:

1. The millage rate has been decreasing for years from 2.25 in 2020 to 1.99 in 2025, where it remained this year. The 2027 budget calls for a further reduction to 1.874.
2. The storms of 2024 resulted in a loss of $300,000,000 of taxable assessed valuation while we froze the millage rate, resulting in a revenue loss of approximately $600,000 the following year.
3. Balanced our budgets in 2024 & 2025 while utilizing some reserves, still maintaining the recommended 25% of operating budget in unassigned reserves.
4. Prudent management resulted in actual operating expenses of approximately $1,000,000 below budget for 2025.
5. The existing “Save Our Homes” Legislation caps homesteaded properties at a 3% maximum assessed valuation increase annually and allows ”portability”, allowing up to a $500,000 decrease in assessed valuation to the purchase of a different homesteaded property in Florida.
6. Holmes Beach will receive approximately 98% of all storm related costs due to adhering to FEMA guidelines.

ADVERSE AFFECTS of Amendment 3

1. There are no offsetting revenue sources identified to address the financial loss to cities and counties.
2. 47% of Manatee County properties are homesteaded, high impact for the County and cities within.
3. Cities may establish new fees to offset the losses which could result in a less equitable means of spreading the costs of city services.
4. Services such as public works, stormwater improvements, parks maintenance and future wetland purchases may be curtailed in order to balance budgets. Public safety and road maintenance & improvements could also be affected. Statewide, Public Safety represents 56% of cities general fund spending.
5. A reduction in services and or an increase in assessments are the remaining options for cities to consider. This would represent a SHIFT of revenue sources, potentially eliminating gains from the homestead exemption increase.
6. The greater the percentage of Homesteaded properties, the greater the financial loss to those communities, thus the disparity to various cities and counties.
7. A further troubling result of passage would be a continued reduction of local control or HOME RULE. Home rule is granted by our state constitution, allowing small government and local control by local citizens choosing the candidates they elect to govern their community. This amendment places future control of property tax amendments solely to future legislatures.

Considerable pushback has been established through lawsuits and opposition by multiple organizations, including the States Fire Chiefs’ Association. It is important for all registered voters and property owners to understand the full consequences of this proposal. Be thorough in your research of this proposal.

I recommend a NO vote. Click here for more information from the Florida League of Cities.

Terry Schaefer is a Holmes Beach Commissioner & Legislative Liaison.