The city of Jacksonville could no longer afford incentives for Downtown should voters approve a Florida property tax constitutional amendment in November, Mayor Donna Deegan said June 2.
As the city considers funding for a Culinary Institute of America campus, a Publix on Laura Street and other projects, a ballot proposal that would increase the state’s homestead exemption on residential property taxes to $250,000 from the current $50,000 within three years could halt those plans.
That change, which the Florida Legislature voted June 2 to place on the November ballot, could eliminate more than $300 million in revenue for the city by fiscal year 2029, according to City Council auditor projections.
To be adopted, the measure will require 60% approval from voters in a November ballot measure.
Speaking alongside other Florida mayors at the Downtown Development Forum at EverBank Center, Deegan said the city would need an additional form of revenue to make up the difference to fund Downtown projects should the ballot measure be approved.
“We are at a point in this city right now where we have so much momentum, so much momentum, and it would be a crying shame to put the brakes on that for political expediency,” Deegan said, sitting next to Downtown Investment Authority CEO Colin Tarbert .
In February, Tarbert told the Council Special Committee on the Future of Downtown that between four projects that are under consideration by Council and six others that are expected to come forward over the next five years, completion grant requests could total almost $225 million.
Tarbert presented a list of 10 projects that included potential incentives for a potential Hard Rock Hotel at 500 E. Bay St., a Publix-anchored development of Block N7 in Gateway Jax’s mixed-use Pearl Square development, redevelopment of the Laura Street Trio and more.
The total of completion grants could increase, as City Council members voted in May to express support for up to $35 million in incentives for a CIA campus on the Northbank.
The DIA estimated completion grants for the 10 projects at $145.62 million on the low end and $224.72 million on the high end. Total development costs of the 10 projects would be $1.14 billion.
Proponents of the reform plan, including Gov. Ron DeSantis, have said that local governments’ collection of property tax revenue has become bloated in the midst of an affordability crisis for many Floridians.
Critics, including Deegan, have said that the plan would gut city budgets while offering little assistance for Florida residents who would not qualify for a homestead exemption.
“What’s being proposed right now is that you take out a load-bearing wall out of the middle of a house, and then you leave nothing there to keep the roof from falling in,” Deegan said. “I’m not sure our folks in Tallahassee really understand the entirety of how much property taxes fund our city governments in this state.”
In a message to City Council members provided to the Daily Record, Council Auditor Phillip Peterson wrote that based on FY25 property assessments, Jacksonville would lose $265 million in revenue from a $250,000 homestead exemption. That’s roughly 12% of the city’s current budget, which is slightly more than $2 billion.
Based on projected FY27 property values, Peterson said the city would lose $300 million from a $250,000 exemption.
According to a May 27 news release, DeSantis’ property tax measure would not allow municipalities to reduce funding for public safety, education and schools, infrastructure and natural resources. The plan also would create a trust fund to provide grants to local governments to maintain core local services, according to the release.
Additionally, Florida municipalities would be barred from increasing local governments’ tax assessments on small business more than 5% year-over-year. Currently, the cap is 10%.
Peterson said that change would result in further lost revenue for the city. With the state Legislature’s passage of the legislation on June 2, Peterson’s office is set to consider the matter further.