Summary
Amendment 2 would make permanent the existing 10 percent annual assessment increase cap on non-homestead parcels, which includes second homes, rental apartments, and as commercial property. As with Amendment 1, school levies are exempted from this measure.
Fiscal Impact
We estimate little to no financial impact.
Proponents’ Argument For
Proponents argue that non-homestead properties like rental apartments and commercial property are critical to Florida’s economy and deserve permanent protection from large property tax increases in the same way that homestead parcels are. Homestead parcels are protected by a 3 percent annual cap. Proponents argue this measure makes little change to law other than making this previously agreed upon 10 percent cap for non-homestead parcel permanent.
Opponents’ Argument Against
There is currently no opposition to this amendment.
Discussion
Florida’s economy incorporates a lot of second homes, rental properties, and business properties. After the current 10 percent increase cap was put into place, property tax revenue continued to rise so there have not been negative impacts on state and local revenues but there have been real savings for taxpayers. This is particularly important for rental properties, which Florida needs more of. Restraining taxes on rental properties would help housing supply to catch up with demand. Making the cap permanent so that non-homestead parcels would not see significant property tax increases in any given year makes good tax policy and economic sense.
Voters’ Guide to the 2018 Florida Ballot Amendments
The Voters’ Guide examines the proposed amendments to the Florida Constitution that are on the Nov. 6, 2018, ballot.