Legislature Changes The Math On Property Tax Plan To Protect Schools From Desantis’ Proposal

By: Christine Sexton and Jay Waagmeester

The Florida Legislature is moving quickly to put into play a revamped proposal pushed by Gov. Ron DeSantis to drastically reduce property taxes, homestead and otherwise, with potential final passage as early as Tuesday.

Top legislative Republicans in the House and Senate altered the plan Monday to exempt from reduction or potential elimination the property taxes used to help fund public schools as well as local government agencies and officers such property appraisers, tax collectors, and supervisors of elections and the expenditures they approve.

But the plan still faces opposition from both Republicans and Democrats.

Volusia County Senate Republican Tom Wright said his office received 1,282 emails and calls before the start of a meeting in which the Senate Appropriations Committee which passed the property tax resolution on a 13-5 vote.

Although Wright voted for the bill in its one and only Senate committee stop, he said he wasn’t likely to support final passage absent changes. He said the resolution was “too rushed, too fast, too quick.”

Education carve out

The House and Senate changed the resolution so it wouldn’t affect education funding despite DeSantis’s defense of having the plan hit schools during a Land O’ Lakes press conference earlier in the day.

“We’ve increased funding every year for them. But you know, you have some of these school districts that have had a decline in student population, and yet they’ve had massive, massive increases in the amount of money,” the governor said.

Local governments pay nearly half of funding for public schools, which in Florida includes a universal school voucher program that provides stipends to attend private schools to families regardless of  income. Property taxes contribute much of the local government contribution to schools.

A local government’s share of the contribution to education depends on property values and taxes levied on those properties.

House Speaker Designate Sam Garrison, R-Fleming Island, said it’s necessary to protect school funding from the property tax reductions.

“Schools don’t have the ability to be nimble and flexible like local governments do,” Garrison said, noting that schools lack the ability to charge user fees to offset any funding losses coming their way.

The education carve-out was offered in the Senate by Sen. Jay Trumbull, a Republican from Panama City.

Despite the changes made to DeSantis’ proposal — SJR 2-F in the Senate and HJR 1F in the House — the proposals face opposition from the Florida Association of Counties, Florida League of Cities, and others.

“It’s an historic shift. Cities could go bankrupt and counties could be forced to consolidate. Nobody’s modeled it,” Jeff Scala deputy director Florida Association of Counties, told members of the Senate Appropriations Committee.

Scala and many others who spoke before the House and Senate Monday repeated that the Taxation and Reform Budget Commission should delve into the issue.

Established in the Florida Constitution, the commission meets every 20 years to examine the state budgetary process, revenue needs and expenditure processes of the state, appropriateness of the tax structure of the state, and governmental productivity and efficiency. Its next meeting is next year.

Health care

SJR 2-F bill sponsor Sen Bryan Avila said a vote to protect funding for constitutional offices and officers and “the expenditures approved by such county or municipal governing bodies” would cover counties’s ability to collect money at the local level that is sent to the state to draw down matching federal Medicaid dollars.

Those funds are known as “intergovernmental transfers” or IGTs, and are used to help with supplemental Medicaid payments made to hospitals.

Specifically, Avila said, the money would protect what’s known as “Low Income Pool” payments as well as “Hospital Directed Payment Program” funds, the latter of which documents show support 280 hospitals with additional funding.

DeSantis has been discussing elimination of all property taxes for more than a year and last week sent a proposal to the Legislature that would increase the state’s homestead property tax exemption from $50,000 to $150,000 beginning Jan. 1, 2027, and to $250,000 beginning Jan. 1, 2028.

The plan requires three-fifth approval from both the House and Senate and then 60% approval by Floridians as a proposed constitutional amendment in November. It would immediately eliminate property taxes for 60% of Florida homeowners.

The governor called the Legislature back into the three-day special session to pass the proposal — a truncated timeframe that concerned many.

Sen. Tina Polsky, a Democrat from Boca Raton, called it “legislative malpractice” to consider and pass the legislation in two days. “It’s too much in too short a period of time,” she said

Florida AFL CIO lobbyist Rich Templin likened the proposal to a rushed homework assignment.

“I feel like I’m looking at one of my kids’ book reports, like, when they started the night before it was due,” Templin said.

Run the government like a business

Meanwhile, the House State Affairs committee voted, 20-7, to pass the resolution sponsored by Rep. Toby Overdorf, R-Palm City.

Since 2020, Overdorf said, there has been a “tremendous amount of increase” in tax levies. “And I do believe that the state could handle a haircut associated with the revenues that are projected to be decreased,” he said.

Rep. Anna Eskamani, a Democrat from Orlando, asked if revenue decreases but cost of county services stayed the same, where the difference gets made up?

“We’re really looking at government becoming more like a business, if you will. I have to make decisions at my business every single day with costs rising and potentially fees going down; I have to make those decisions,” Overdorf said, going on to ask counties to decide where the best place is to spend money.