Florida voters will decide in November whether to approve a constitutional amendment backed by Gov. Ron DeSantis that would raise the homestead exemption from $50,000 to $150,000 in 2028, then to $250,000 in 2029. The amendment requires 60% voter approval. If it passes, Orlando projects it would lose $30 to $35 million in property tax revenue in fiscal year 2028 alone, growing to a cumulative loss of $75 to $85 million over the first two years.
Mayor Buddy Dyer was direct in his opening remarks. “If substantial reductions in local revenues are enacted, cities like Orlando will be forced to make some difficult decisions,” he said. “Every dollar removed from local government revenue is a dollar that can no longer be invested in local priorities unless an alternative funding source is identified. There is no way around this basic fact.”
City CFO Jose Fernandez laid out how Orlando’s property tax composition makes it somewhat less vulnerable than other Florida cities, since roughly 19% of the city’s property tax revenue comes from homesteaded properties versus 81% from non-homesteaded properties, a ratio that cushions the blow compared to cities where homesteaded properties account for 40% or more of the base. Still, 20% of $360 million is still a pretty significant amount.
The city says it is taking pre-emptive steps. Fernandez announced a hiring freeze for general fund positions, requiring every vacancy to be evaluated before it can be filled. The freeze excludes enterprise funds and self-sustaining departments. The city is also creating a Property Tax Reform Stabilization Fund from any fiscal year 2025 surplus, building a separate reserve specifically to absorb the revenue hit if the amendment passes, which is separate from the city’s existing reserves, which the city wants to preserve for bond rating purposes.
The proposed fiscal year 2027 budget, presented by Assistant CFO Jason Wojkiewicz, is tentatively balanced at just shy of $1.9 billion with no millage rate increase. Property tax revenue is projected to grow about 6%, driven by new construction and rising valuations. The only departments adding net new positions are police and fire, with nine OPD positions and 37 OFD positions, primarily 30 firefighters and six paramedics for the new Fire Station 18 in the southeast. Every other general fund department saw a net decrease in positions.
The most notable operational cost pressure is in technology. The city’s contract with Axon for body cameras, Tasers, drones, and associated software now runs nearly $8 million per year. IT contracts overall are up $6.5 million for the coming year. The city also noted that property tax revenue does not cover the cost of public safety and that gap is widening, growing from $46 million in fiscal year 2026 to $58 million in fiscal year 2027.
Commissioner Shan Rose asked departments to begin communicating more visibly about what taxpayer dollars fund. “Look at your dollars at work,” she said. “OPD just had a press conference, say ‘look at your dollars at work, this drone footage.’ I think collectively all of the departments really need to start honing in on that.”
Cities across Central Florida are watching the amendment closely. Sanford’s mayor said the city would lose $15 million in tax revenue if it passes. Ocoee projects a $4.1 million loss in the first year, growing to as much as $8 million by 2028, and is already weighing whether to raise other rates to offset the lost revenue.
Two public budget hearings are scheduled before the city’s October 1 budget implementation date, at 5 p.m. at Orlando City Hall on September 14 and September 28.
