Q&A – Will Local Governments Raise Mileage Rates if Property Taxes Are Cut but Not Eliminated?

Since 2000, Florida’s population growth has been 116%. During that same time property tax revenue collection has risen by a staggering 370%. In other words, property taxes have risen at greater than 3x the rate of population growth!

Episode Transcript

Speaker 1 (00:02):
You have questions. Brian has answers. It's time for today's
Q and A of the day. This is the Brian
Mud Show. Today's Q and a.

Speaker 2 (00:11):
Will local governments raise millite rates if property taxes are cut.

Speaker 1 (00:16):
But not eliminated.

Speaker 2 (00:18):
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Speaker 1 (00:40):
See it toapic.

Speaker 2 (00:40):
You may laid down a message right there, maybe for
a future Q and A just like this.

Speaker 1 (00:46):
Hey, Brian, don't you think that increasing the homestead exemption
is just.

Speaker 2 (00:51):
Going to prompt the taxing authorities to increase the militch rates?

Speaker 1 (00:56):
Yeah?

Speaker 2 (00:56):
I think you bring up a very instructive point. Today's
note is in response to the recent Q and A
discussing the possibility of raising the home set exemption. As
a listener suggested as opposed to the outright elimination of
property taxes. Notably the conversation and at times of debate

(01:18):
that we've had about property taxes in recent months, as
Governor de Santis has pushed for the elimination of home
seat of property taxes.

Speaker 1 (01:25):
It seems to be kind of an indicative of.

Speaker 2 (01:27):
The mood across the state trying to figure out what
the right play is here. One of the recent developments
is a James Madison Institute report entitled Property Tax Relief
in Florida, Challenges, Options and the Path to True home Ownership.
In the report, the Institute included their most recent surveying

(01:50):
of Floridians on the issue of property tax relief see
where there was currently enough support to potentially pass a
constitutional amendment for relief next November. What they found is
that just broadly on the issue of property tax relief,
the numbers are there. If you just say, should we
pass a constitutional amendment providing property tax relief, seventy two

(02:13):
percent of Lordians now say yeah, we should do things differently.
But how as the summation to the report read, for
Florida homeowners, the question is not whether property taxes should
be reformed but how far these reforms should go. If

(02:33):
lawmakers combine fiscal discipline with solid solutions, Florida can lead
the nation to provide long lasting relief for generations.

Speaker 1 (02:43):
Okay, so about that.

Speaker 2 (02:44):
Here's something remarkable that stood out to me in the
James Madison Institute study. This was my number one takeaway
from their entire study.

Speaker 1 (02:55):
It was the jaw dropping moment for me.

Speaker 2 (02:58):
Since two thousand, Florida's population growth has been one hundred
and sixteen percent. Okay, one hundred and sixteen percent population growth.
How much has tax revenue collection increased during that time?

Speaker 1 (03:20):
What would you would expect for it to be. I
would say it's probably around double probably somewhere in the
two to two fifty two hundred and fifty percent range.

Speaker 2 (03:30):
And that would be a lot because anything that is
not in proportion means that government grew at a faster
rate than the needs of the community. Right, if we
had one hundred and sixteen percent population growth, you should
roughly have just to keep things as they were in
two thousand, about one hundred and sixteen hundred and twenty

(03:52):
percent increase in property tax revenue collection. But no, it
was not two hundred percent Jall, not two. It was
three hundred and seventy percent. We have seen property tax
revenue collection by taxing authorities grow by a staggering three

(04:13):
hundred and seventy percent. In other words, property taxes have
risen at greater than a three times population growth rate,
three greater than three times. I never want to hear
another taxing authority in this state, as long as we
keep anything close to what we currently have in place complain. Ever, again,

(04:37):
this is outrageous on every level. I am not taking
a look back to two thousand to see just how
egregious this this had actually become. I'm not even sure
if DeSantis had, you'd probably get this too. Local governments
have shown that they will collect higher the needed property taxes.

(05:03):
This is really the question here, right, what will local
governments do given the opportunity. That's what they'll do given
the opportunity. Holy cow, So about this. If the property
tax exemption is simply raised as opposed to eliminated, isn't
it likely that local governments will just raise milit rates

(05:25):
to compensate. It's a very astute observation question. So given
the history, you have to think that's a very real possibility.

Speaker 1 (05:36):
So about that.

Speaker 2 (05:36):
According to Florida Tax Watch, the average militrate or property
tax rate that is assessed by local governments, it's just
over seventeen mills. It probably won't surprise you to know
that the average rate for all South Florida communities is
higher than the rate of the state overall. And it

(05:57):
might surprise you that these most expensive by way of
militarrate in the state is on the Treasure Coast.

Speaker 1 (06:05):
So about that.

Speaker 2 (06:05):
Let's go through some of these counties real quick. The
mills that are assessed. Remember, the average is just over
seventeen statewide, Indian River County fifteen point four, Martin fifteen
point five, Palm Beach eighteen point seven, Saint Lucie highest
in the state at twenty two point eighty five. So,

(06:28):
in terms of the view of the possible under state law,
here are the current limits on militrates that can be
imposed by local governments. A county can go up to
ten mills, a municipal government can go up to ten mills.

Speaker 1 (06:39):
School districts can go up to twenty.

Speaker 2 (06:42):
So if you take a look at I mean, you
could find a way if they all tried to maxcess
stuff out to get us to forty mills. Yeah, they
could do a lot they wanted to. Overall rates could
go a lot higher. By the way, votera referendums are
also excluded on understay law from this. So if voters
both themselves more taxes, which I mean is beyond me,

(07:06):
but voters in many counties I have done so in
the name of various different things, often schools. An answer
to today's question without getting into all the nitty gritty
possibilities unbalance the nswers. Yes, most local governments tax authorities
not only could seek to raise milit rates because they're
not at the state limit right now, but they're also

(07:30):
is a likelihood it could happen, and so that should
be part of the calculus considered by voters as they
weigh which of the proposals they favor in the state
legislative session. As I've mentioned since the onset, I fully
back Governor DeSantis' proposal to eliminate property taxes for home
seat of properties on principle, you know, the concept being
that you never really own your property if local governments

(07:51):
can take it away from you without pay annual taxes
to retain it. All any homeowner otherwise is effectively do
and just kind of renting their property from each of
them the tax and authorities on their property tax bill.

Speaker 1 (08:03):
Otherwise