As we recently reported, the Florida House of Representatives passed a bill that would eliminate all “non-school” property taxes. It still needs approval from the Florida Senate and the governor before it would go to the ballot for Florida voters to decide.
Florida House Passes Landmark Bill to Eliminate Property Taxes: What It Means for Miami Springs
What would the impact be to the City of Miami Springs?
At Monday’s Miami Springs City Council Meeting, the City Manager, J.C. Jimenez, stated the City of Miami Springs could see a shortfall of “roughly $8.4 million” per year. Since the law protects law enforcement, the departments most likely to see cuts in services and staff would likely include Public Works and Parks and Recreation.
It may also mean new “user fees” for everything from trash pick up to playing Pickleball.
The good news is that it wouldn’t happen all at once. There would be a 10 year fade away plan. This would allow municipalities like Miami Springs time to adapt and possibly add new revenue streams to offset the budget losses.
WinnersÂ
Homeowners win big!Â
This will put some extra cash in the hands of every Miami Springs homeowner as they will have a dramatic reduction in their property taxes. If you have a mortgage, this could drop your mortgage from hundreds of dollars per month to possibly thousands depending on your tax bill.
Your home value may also go up. Eliminating property taxes makes owning more affordable. That will likely increase the pool of potential buyers. As a result, we can see increased demand on the existing supply. Anytime there’s more demand than supply, prices go up.
New Home Buyers
It’s no secret that buying a home in Miami Springs has gotten a lot more expensive. However, that monthly mortgage may be significantly easier to pay if the property tax is virtually eliminated. To coin a phrase, it’ll make Miami Springs more affordable / attainable for more people.
Realtors
Eliminating property taxes on your primary residence will make Florida even more desirable than it currently is. It’ll make the sky high insurance rates a little bit more palatable knowing you don’t have to pay property taxes outside of the school taxes. It may encourage renters to purchase instead of renting. It’s also going to make Florida more desirable for residents from high tax states like California and New York.
Losers
Renters
Multi-family properties like apartment complexes will still be required to pay their full property taxes. In other words, while life may get easier for home owners, this does nothing to help with the affordability for renters.
Small Towns
Small towns like Miami Springs that rely heavily on the residential tax base and only have a small commercial base as a percentage of their tax base are going to have a major problem if this bill goes into effect.
Municipal Employees
Non law enforcement employees might be at risk. With a potential $8.4 Million loss of income, the city will have to take drastic action to balance the budget. That may include hiring freezes, salary freezes, reductions in hours, and possibly even layoffs.
What do you think?
Will you benefit from not having to pay property taxes?
How should the City of Miami Springs attempt to make up the $8.4 million annual loss if the bill becomes law?
Do you think cities like Miami Springs might try to rezone homesteaded property to multi-family or commercial in order to turn the real estate into tax collectible real estate?
Scroll down to the bottom of the page to share your thoughts.
