Florida voters approved Amendment 3, the Associated Press reported. Unofficial Florida Election Watch returns checked Nov. 4 showed 4,917,482 yes votes, or 61.99%, clearing the 60% threshold. The measure raises the homestead property-tax exemption for non-school taxes and could force local governments, including Miami Beach, to weigh service cuts, fees or higher millage rates.

The constitutional amendment cleared the 60% threshold required for passage, winning 62% of the vote, The Real Deal reported. The change takes effect Jan. 1, 2027.

For Miami Beach homeowners with a homestead exemption, the savings will phase in over two years. The exemption on non-school taxes jumps from $50,000 to $150,000 in 2027, then to $250,000 in 2028. After that, the Florida Legislature will adjust the exemption annually based on the consumer price index.

What it means locally

Miami Beach's general millage rate for fiscal year 2027 is 5.8060 mills, according to a city commission budget memorandum from City Manager Eric Carpenter dated Sept. 23. The city expected to collect about $307.9 million in general fund property tax revenue at that rate, based on $62.4 billion in certified taxable value.

Amendment 3 could shrink that tax base significantly. No Miami Beach-specific revenue loss estimate has been published, but the Florida Policy Institute estimated the measure could reduce local government revenues statewide by nearly $12 billion on a recurring annual basis, according to The Real Deal. The Miami Herald reported that state estimates put the loss at roughly $5 billion in 2027, climbing to nearly $12 billion by 2031.

In Miami-Dade County, an analysis from the Florida Policy Institute estimated $1.5 billion in lost revenue over fiscal years 2028 and 2029, the Herald reported in a separate pre-election analysis. Jackson Health System, the county's public health network, estimated it would lose $64 million in funding over two years.

The tradeoff

The amendment does not include a replacement funding source for local governments. As written, it does not protect funding for police, fire or other services, according to The Real Deal.

Police and fire unions opposed the measure. The Florida Police Chiefs Association, Florida Professional Firefighters, Florida State Fraternal Order of Police and the Florida Sheriffs Association all campaigned against it.

Nicole Fox, a tax policy analyst with the Tax Foundation, a nonpartisan Washington-based research group, told the Herald that local governments face three options: cut services, raise fees or increase property tax rates. Many could pursue some combination of all three, she said.

Miami Beach's current tax rate of $5.80 per $1,000 of taxable value sits well below the $10 constitutional cap, the Herald reported. That gap leaves room for the city to raise its millage rate to offset lost revenue.

Miami-Dade Property Appraiser Pedro Regalado, a vocal supporter of Amendment 3, told the Herald he does not expect dramatic millage rate increases because of the political backlash they would cause.

Commercial and rental properties

The amendment also cuts the annual assessment cap on non-homesteaded properties, including commercial real estate, second homes and rentals, from 10% to 5%. In Miami Beach, the current 10% cap already applies to non-homesteaded properties, according to the city budget memo.

Non-homesteaded properties account for nearly $443 billion, or 73%, of total assessed property value in Miami-Dade, the Herald reported. But owners of those properties may not see net savings if local governments raise millage rates to compensate for homestead revenue losses.

Alexander Ruiz, chief operating officer of South Florida developer Prestige Companies, told the Herald that local governments "are going to look to make up the revenue in some capacity."

Renters could also feel the squeeze. Tax Foundation senior fellow Jared Walczak estimated that if local governments raise rates to cover lost revenue, Miami-Dade apartment renters could face roughly $291 more per year in rent, The Real Deal reported. Single-family home renters could see increases closer to $1,200 annually.

What comes next

Gov. Ron DeSantis, who pushed the Legislature to place the amendment on the ballot, will likely call a special session to craft implementing legislation, the Miami Herald reported. Florida Rep. Chip LaMarca, a Republican whose district includes part of Broward County, said at an industry panel hosted by Master Brokers Forum that the amendment was "not perfect" but a starting point, according to The Real Deal.

Byron Donalds won the governor's race on Nov. 3 and is expected to work with the Budget and Tax Reform Commission on further property tax changes, The Real Deal reported.