Credit rating agencies release analyses of Florida property tax amendment on city, county finances

TALLAHASSEE, Fla. (WCJB) - Three credit rating agencies have published analyses of the proposed property tax constitutional amendment that will be on the November ballot.

According to the Florida Association of Counties (FAC), agencies Moody’s Ratings, Fitch Ratings, and S&P Global Ratings all believe that this amendment would reduce revenue for cities and counties significantly if approved by voters.

They say this could put essential services at risk, increase financial pressure on local governments, and put the tax burden on non-homestead property owners, including commercial properties.

If approved with 60 percent support by Florida voters in November, the constitutional amendment would increase the current exemption for owner-occupied homestead property to $250,000 over two years and create a framework for full exemption over time.

“Owning your own home has been the American dream since our nation was founded 250 years ago. What better way to celebrate America’s 250th anniversary than a massive property tax cut through a $250,000 homestead exemption for Floridians,” said Senate President Ben Albritton (R-Wauchula).

The amendment would go into effect if approved on Jan. 1, 2027, giving homeowners a $150,000 homestead exemption. The next year, it would increase to $250,000 and increase by inflation every year after.

The FAC released a summary of all three statements from the agencies.

Moody’s Ratings

Moody’s Ratings has found that if the property tax exemption expands, cities and counties will collect less money. With less money coming in, public services could be cut. Savings could be used to cover costs and other ways will need to be found to raise money.

Moody’s officials say that using savings is not a long-term solution, and it could leave cities and counties in a poor economic position.

Furthermore, they say not everyone will benefit from the tax break. Those who do not qualify could end up paying more in taxes to make up for lost revenue.

Fitch Ratings

Officials from Fitch say that this plan would cut property tax money coming into local governments, and there is no backup plan to replace it. They say that could put pressure on city and county budgets.

In order to make up for the loss, local governments could raise fees or shift costs onto businesses or people. If money gets tight and cities and counties lose financial stability, it can be more expensive to borrow money or raise costs that affect taxpayers.

S&P Global Ratings

According to officials at S&P Global Ratings, this plan could significantly reduce property tax revenue with no clear plan to replace it. They say this can put financial pressures on cities and counties.

Officials say this may also limit how much tax revenue can grow and restrict how the money can be used for public safety and education.

The FAC says all three agencies point to similar concerns, and Floridians should pay attention.

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