Florida Special Session on Property Tax Has Adjourned

The Florida House of Representatives and Senate passed all three bills making up the Florida property tax reform package. The package includes a statutory rollback and cap of real estate tax rates, a proposed constitutional amendment creating a Florida “super homestead exemption” and a bill designating the upcoming January 29, 2008 presidential preference primary as the date for Floridians to vote on the “super homestead exemption” amendment.

Here is an overview and outcome of the special session broken down by the specific issue:

Statutory Millage Rate Rollback

  • Millage rollbacks will be required of cities, counties and special districts for FY 2007-08 taxes (November 2008 tax bills). Rollbacks will not be required for school taxes.
  • Rollback required will be to 2006-07 revenue levels, plus an additional cut based upon a local government’s 5-year history of property taxes on a per capita basis compared to statewide average taxes on a per capita basis.
  • Statewide average will be calculated separately for cities and counties. Cities and counties will be required to rollback 0% to 9% (0, 3, 5 or 9%).
  • Special districts will be required to rollback and cut 3%.
  • Local governments can override the rollback by extraordinary vote.
  • Vote required is:
    • 2/3 to exceed reduced level + tax on new construction up to 2007-08 revenues;
    • unanimous to exceed 2007-08 “rolled back rate” and go up to 2006-07 actual millage rate;
    • voter referendum to exceed the 2006-07 actual millage rates.



  • Provides potential for across-the-board tax relief in estimated amount of $15.6 billion over 5 years.
  • Does not apply to school taxes (approximately 40% of the property tax bill).
  • Requires greater reductions from those cities and counties who increased taxes the most on per capita basis between FY 2001-02 and 2006-06.
  • Not applicable to debt service millage, so tends to favor local governments that relied upon bonding over those who paid cash.
  • Municipal service taxing units and dependent districts, the predominant purpose of which is emergency medical or fire rescue services, are treated like independent special districts.
  • Cities and counties of “special financial concern” receive preferential treatment.
  • Revenues used to fund public hospitals in counties that levy hospital surtax receive preferential treatment.

Statutory Caps on Millage

  • Future millage increases after FY 2007-08 for cities, counties and special districts will be limited to the “rolled-back rate,” (rate that produces same taxes as prior year, exclusive of taxes from new construction) plus growth in personal income.
  • Local governments can override the cap by extraordinary vote.
  • (a) 2/3 vote of board for up to 10% increase over rolled back rate;
  • (b) unanimous vote of board for increase in excess of 10%, unless board exceeds 9 members, in which case required vote is 3/4


  • School taxes will not be capped.
  • Fees, assessments and other revenue sources are not capped.

Increased Millage Rates to Offset Constitutional Tax Base Reductions

  • If the constitutional amendment passes, cities, counties and special districts in FY 2008-09 can override caps in order to make up the loss in tax base from the homestead exemption and other exemptions/reductions.
  • Local governments can override the cap by extraordinary vote.
    • (a) by a 2/3 vote, the rate can be increased to restore 67% of the difference between the rate that would apply absent the base reduction and the true rolled-back rate; and
    • (b) by a unanimous vote, or 3/4 vote for board with 9 members or more, any rate can be imposed.


  • Substantial tax base reductions—particularly from the new super homestead exemption—will put pressure on local governments to utilize these override mechanisms to raise millage rates to make up for taxes lost to base reductions.

Constitutional Relief

  • Place on ballot for January 29, 2008 presidential preference primary election


  • If approved by the voters in January 2008, the constitutional relief would be applicable retroactively to January 1, 2008.Constitutional changes must be approved by at least 60% of the voters, and some have suggested that elimination of SOH triggers 66% vote.

Super Homestead Exemption

  • Homeowners can opt out of current Save Our Homes cap and $25,000 homestead exemption and opt into a new, 2-tiered “super homestead exemption.” Tier 1 will exempt 75% of first $200,000, with a minimum exemption of $50,000. Tier 2 will exempt 15% of next $300,000. Opt-out of Save Our Homes is irrevocable. 1st-time home buyers and those who move will not have option for SOH cap.


  • Applies to all tax bases including schools, but legislature stated intent to hold schools harmless from cuts. However, public promises by House leadership not to increase required local efforts rates suggests the Legislature will need to look elsewhere for the up to $1.5 to $2 billion per year in school property tax reductions anticipated as a result of reductions to the base.
  • Unknown. No revenue impact analysis done on amendment giving homeowners option.

Future Homestead Increases

  • Constitutional amendment annually increases $500,000 maximum value against which 15% exemption is applied by growth in personal income. Also authorizes Legislature, by 2/3 vote, to increase the homestead exemption.


  • Super homestead exemption is repealed if constitution amended to provide for assessing homestead property at less than just value.

Minimum Homestead Exemptions

  • Constitutional amendment guarantees a minimum homestead exemption of $50,000, ($100,000 to low income seniors).


  • Low income seniors exemption applies to those 65 and older whose household income is $20,000 or less.

More details coming on the following items:

  • Non-Homestead Residential Property Exemption
  • Commercial Property Exemption
  • Tangible Personal Property Exemption
  • Working Waterfronts
  • Affordable Housing
  • Valuation—Highest and Best Use
  • Valuation—Deed Restrictions


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