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By Giulia Carbonaro
Senior Reporter
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A major property tax reform backed by more than 60 percent of Florida voters is set to reshape the state under Governor-elect Byron Donalds, the Republican who will take over from Governor Ron DeSantis in January.
Amendment 3 was approved by roughly 62 percent of voters on November 3, clearing the 60 percent threshold required to amend the Florida Constitution. The measure will significantly reduce property taxes for some Florida homeowners and change how local governments collect and spend property tax revenue.
DeSantis spearheaded efforts to provide property tax relief to struggling Florida homeowners over the past year, describing the levies as “the worst way to do taxation.” After months of debate, the measure pushed forward by lawmakers was not exactly what DeSantis had intended, and he has made clear he expects deeper cuts in the future.
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What happens next with Florida’s property taxes, however, will be up to his successor. Donalds, who is currently a U.S. congressman that was endorsed by President Donald Trump, made history on November 3 when he was elected Florida’s first Black governor, defeating Democrat David Jolly 50 percent to 48.7 percent.
Donalds supported Amendment 3 on the campaign trail but has also made clear that the voter-approved measure is unlikely to mark the end of the state’s property tax overhaul.
“Whether it passes or whether it doesn’t, next year in the [Florida Taxation and Budget Reform Commission], we are going to bring proposals for a full and complete reform of property taxes and fees in Florida,” he said in August, as reported by Florida Politics.
“We want to make sure that seniors on fixed income are not being taxed out of our state, and we want to make sure that young families, working families have the opportunity to build the Florida dream for themselves here in Florida. And we’re going to start that work next year,” he added.
But experts have raised concerns about the impact that Florida’s property tax overhaul will have on local governments’ budgets and have doubts about how Donalds will handle the financial pressure on public services.
Newsweek contacted Donalds’ campaign and office for comment by email on Wednesday and Thursday but did not receive a response.
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How Will Property Taxes Change Under Amendment 3?
Amendment 3 will increase the homestead tax exemption for non-school district property taxes in Florida to $150,000 in 2027 and $250,000 in 2028, with the amount indexed to inflation starting in 2029. The measure prioritizes long-term Florida residents, while new residents, who arrive after December 31, 2026, will receive a smaller exemption, up to $50,000, until they have lived in the state for five years.
For non-homestead properties—such as rental units, second homes, and commercial real estate—the amendment also lowers the cap on annual assessed value increases for non-school taxes from 10 percent to 5 percent.
It will also require counties and municipalities to spend property tax revenue on public safety, education, infrastructure, natural resource projects and flood control, local bonds, employee retirement benefits, and government operations.
Critics of the measure have argued that the amendment will leave a gaping hole in local governments’ budgets, negatively impacting services and programs throughout the state, including public safety, parks and infrastructure.
Then-State Senator Shevrin Jones, a Democrat, described the amendment as “lipstick on a pig,” arguing that it does not provide Floridians with the tax relief its supporters have promised. “This is a tax shift—you might not pay it on this, but you’re going to pay it on that,” he said during a news conference in September.
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When Will the Property Tax Reform Be Implemented?
The amendment will take effect on January 1, 2027.
According to Abigail Hall, Professor in Economics at the University of Tampa, “homeowners should see the changes reflected in their proposed tax notices in August 2027, and then again in their bills in November.”
Impacts will vary based on factors like a property’s assessed value, if it’s homesteaded or not, and local tax rates, she told Newsweek.
How Will Amendment 3 Impact Florida?
Many Floridians will see significant savings as a result of Amendment 3. But even more could feel the effects of the substantial revenue losses facing local governments.
According to Orange County estimates, Amendment 3 would reduce the state’s property tax revenue by $275 million by 2028. Florida’s Revenue Estimating Conference (REC) determined that the property tax overhaul would reduce local-government revenue by about $12 billion annually by fiscal year 2031–32. That estimate covers the $250,000 homestead exemption and the lower assessment-growth cap for non-homesteaded property only.
“Amendment 3’s drastic reduction in property tax revenue means that communities will be looking for ways to make up the gap—either by cutting or eliminating services or raising fees and other assessments to maintain them,” Sadaf Knight, CEO of Florida Policy Institute, told Newsweek.
According to Knight, Amendment 3 is “a cost shift that does nothing to provide real relief to Floridians—costs will be passed onto working Floridians, whether you’re a homeowner or a renter.”
Shelton Weeks, a Florida Gulf Coast University Professor in the Department of Economics & Finance, told Newsweek that “the loss in revenues will vary greatly across communities in Florida due to the differences in the composition of their tax bases.”
For example, “a community with a large proportion of commercial and industrial properties will have significantly less of a decline in property tax revenue than a community with limited commercial and industrial properties,” he said.
“The decline in revenue will also vary depending on the proportion of residential properties with homestead exemptions. Finally, rural communities with relatively lower property values will be more severely impacted than coastal communities with higher residential property values,” Weeks added.
Hall, meanwhile, fears that “renters, younger residents, and prospective homeowners” will bear the brunt of the property tax overhaul.
“They receive little or no direct benefit but may face higher fees, reduced services, or increased housing costs,” she said, adding that the measure could have a ripple effect on the state’s housing market.
“I’d not be at all surprised if this shifts the calculus for developers and local governments when it comes to choosing between developing residential versus commercial or industrial properties,” Hall said. “Simply, residential is already costly for local governments to service. With Amendment 3—building residential is a bad economic proposition. The result? Less housing.”
Knight shares similar concerns, warning that with local governments potentially facing billions of dollars lost in revenue, “attention will turn to non-homesteads like rental units and commercial properties to raise property taxes, meaning a cost shift onto renters, small businesses, and consumers.”
Nicole Fox, policy analyst at the Tax Foundation, thinks that “all Floridians” could bear the impact of local governments’ expected revenue losses.
“They may see increases in other local taxes and fees as well as see reductions in local service provisions,” she told Newsweek. “Property owners who do not qualify for the increased homestead exemption could see their property tax bills increase if local officials increase millage rates to make up for the lost homestead property tax revenue.”
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What Will Donalds Do?
Fox anticipates that there will be discussions between legislators and the Florida leadership about the property tax overhaul next year, “particularly regarding local jurisdictions who are fiscally constrained.”
Most tax reforms include trade-offs, she said. In the case of Amendment 3, the trade-offs for providing homestead property owners property tax relief could be that Floridians pay more in other taxes and fees as well as facing reduced local services.
“To the extent possible, anticipate an increase in sales taxes, taxes on tourism, and increases in fees related to cars, homes, and other licenses. Increases in gas taxes are also possible,” Hall added.
But tax increases will go against what Donalds has promised during his campaign when he pledged to continue DeSantis’ legacy.
“I doubt if we will see the Donalds administration introducing new taxes to make up for the losses,” Weeks said. “Instead, we should expect local governments to consider all available alternatives for replacing the lost revenue. I suspect most areas will see a reduction in services combined with various revenue replacement strategies.”
Howard Frank, Professor of Public Policy and Administration at Florida International University, told Newsweek he expects Donalds to do the opposite of increasing taxes.
“In California and elsewhere, local governments have typically responded to property tax rebellions by increasing user fees and sales taxes, which remain uncapped under the new legislation,” he said. “I think Donalds will start to limit the expenditure side. We will see limits on growth tied to inflation and population. Increases in user fees (often called non-ad valorem assessments in Florida) will be curbed.”
Republicans in Florida—from DeSantis to the state’s Chief Financial Officer Blaise Ingoglia—have repeatedly accused local governments of overspending and inflating their budgets with unnecessarily higher property taxes.
But Hall sees something potentially sinister in cutting their budgets so drastically. “I have real concerns about what this does for relative political and economic power,” she told Newsweek.
“Property taxes allow for local and municipal governments to raise funding and make determinations about spending, without having to ask Tallahassee. Now, for counties who are unable to cover services or projects due to shortfalls, they’re likely to have to appeal to policymakers at the state level,” Hall said. “This gives policymakers in the State capitol more concentrated economic power—and leverage.”
J. Edwin Benton, a Professor of Political Science and Public Administration at the University of South Florida, thinks that the property tax overhaul “could fly back in the face of any and all these politicians that were aware of it.”
Benton, speaking as a citizen, thinks his fellow Floridians were short-sighted in backing the amendment.
“They did not think clearly about the huge implications of what they were doing. They were thinking short-term rather than long-term,” he told Newsweek. “They were thinking, okay, I can reduce my tax bill. But I don’t think they gave full consideration to what we are going to give up in terms of both the quantity and the quality of services, especially in the area of public safety.”
Benton said that “no one wants to not have fire protection, police protection, or emergency medical services, or repairing and building streets and roads and sidewalks, libraries, parks, and recreational facilities, which typically are funded by property tax revenue.”
The expected negative impact of the reform could hurt Donalds “politically down the road when he may run for reelection in 2030,” he added.
Contact Newsweek editors for this story: Ben Kelly and Anthony Murray.
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