Politics
Jeff Brandes: If Amendment 3 passes, Florida will need city hospice
In November, Floridians will vote on Amendment 3, which would increase the homestead exemption on non-school property taxes to $150,000 in 2027 and $250,000 in 2028, with the exemption adjusted for inflation thereafter. The state’s Revenue Estimating Conference projects the measure would reduce local property tax collections by approximately $45.8 billion over its first five years.
I’m not writing to argue for or against it. I’m writing about what comes after. If it passes, Florida will have fundamentally changed the economics of local government. We should be just as willing to reconsider the map.
Some cities will adapt. They’ll cut costs, share services or restructure. But others, particularly small towns with limited tax bases and heavy fixed costs, may discover they no longer make financial sense as independent governments.
Take Bowling Green, in Hardee County. Ninety-eight percent of its homesteaded properties are worth less than $250,000. Once the exemption is fully phased in, only about 20 homeowners in town would still owe city property tax, and property taxes supply roughly a quarter of the town’s general revenue. This isn’t a city with layers of excess waiting to be trimmed. Bowling Green has about 2,400 residents, seven police officers and one garbage truck. And Bowling Green is not alone.
The worst outcome for towns like it isn’t consolidation or disincorporation. It’s letting a city that is no longer financially viable linger for five or 10 years while employees leave, maintenance gets deferred, equipment ages, reserves drain, fees climb and residents pay more for less.
Under that kind of pressure, cities will search for revenue elsewhere: higher fees, special assessments, fines and other charges. Some of those choices may be perfectly legal and rational. But the easiest dollars to raise are often the ones paid by people who can’t vote there. Taken too far, that incentive leads to the proverbial speed trap on the edge of town. That’s how a revenue problem becomes a public-trust problem.
If the state rewrites the economics, it has an obligation to build the machinery for what comes next. That starts with a new concept in Florida law: the Minimum Viable City. Florida has standards for creating a city. It should also have standards for whether an existing one can still govern itself.
In 2027, the Legislature should modernize Florida’s laws governing municipal merger and dissolution and establish an objective Minimum Viable City standard. The state should begin screenings in 2027 and complete the initial round by early 2028, so affected cities have their results in hand while the full state incentive is available.
Start with municipalities under 10,000 residents, roughly 6 in 10 Florida cities. But population should be the screen, not the verdict. The analysis should examine whether a city can sustainably fund acceptable levels of essential services, maintain adequate reserves, meet pension and debt obligations, maintain infrastructure and carry the fixed overhead of an independent government.
It should look five and 10 years ahead using realistic assumptions about inflation, revenues, population and personnel costs. The screening should identify which cities are financially sustainable, which need restructuring and which face serious long-term viability problems.
For struggling cities, the first answer shouldn’t be dissolution. The process should be: screen, reform, restructure, then transition. Give cities the opportunity to share services, contract with the county, streamline operations or combine functions with neighboring communities. But if the numbers still don’t work, residents deserve to know that too. And residents, not Tallahassee, should make the final call.
A city government can disappear without a community disappearing. The neighborhoods, businesses, churches and traditions remain. What changes is the governmental structure delivering services to them.
To manage those transitions, Florida should create several specialized Municipal Transition Teams. Think of them as city hospice teams. The phrase is intentionally uncomfortable, but the concept isn’t cruel. Hospice is about managing a difficult transition professionally and minimizing unnecessary suffering. Here, the patient isn’t the community. The community lives on. The governmental structure may not.
These teams should include municipal finance experts, accountants, attorneys, pension and labor specialists, and professionals in public safety, utilities and infrastructure. Their job is to establish the facts, lay out alternatives and help communities carry out whatever they ultimately decide. Every hard question should be answered before a crisis. What happens to the debt, pensions and employees? To police, fire and water? Who owns the roads, parks and buildings? Who provides services the morning after a city ceases to exist, and who pays for them?
That expertise isn’t free. The teams should be funded from the transition fund described below, with a firm cap on their share, so the program’s full cost is on the table from Day 1. Small cities shouldn’t have to hire their own consultants to plan their future.
Counties need protection, too. They lose revenue under Amendment 3 as well, and disincorporation cannot mean quietly shifting a failing city’s liabilities onto county taxpayers who are already stretched. Every Minimum Viable City analysis should calculate the fiscal impact on whichever government would inherit a city’s responsibilities, and counties should participate in the transition from the beginning.
Then start the clock. In 2027, the Legislature should appropriate $1 billion for a Municipal Transition Fund, available beginning in 2028. It should pay for the transition teams and cover legitimate one-time costs of consolidation or disincorporation, including costs borne by governments assuming new responsibilities.
Critics will call it ironic for the state to reduce local revenue and then spend $1 billion helping governments restructure. But financial distress rarely gets cheaper with time. The longer a failing city waits, the more difficult and expensive its eventual transition becomes.
This should be a one-time appropriation, never a recurring bailout. It should cover legitimate transition expenses such as pension and employee obligations, contract terminations, technology integration, debt restructuring, records transfers and public-safety handoffs. It should never pay simply to postpone a decision.
Cities should also have a reasonable window to act. The state should cover up to 50% of eligible transition costs in both 2028 and 2029. That gives communities two full years at the maximum incentive to review their screening, attempt reforms, negotiate with neighboring governments and, where appropriate, take the question to their residents. After that, the match steps down: 40% in 2030, 30% in 2031, 20% in 2032 and 10% in 2033. Then it’s gone.
The message isn’t “decide tomorrow.” It’s: Here are the facts. Here are your options. Here is time to make a responsible decision. But don’t linger.
Government’s instinct is to postpone painful choices. But a struggling city doesn’t stand still while officials debate. Reserves disappear, maintenance gets deferred and services deteriorate. Delay has a cost, and residents ultimately pay it.
Florida cannot fundamentally rewrite the economics of local government and then pretend the map of local government must remain frozen in time. Save the cities that can be saved. Consolidate the ones that make more sense together. Disincorporate the ones that no longer work.
But don’t let them linger while their residents pay the price.
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Jeff Brandes is a former Senator and the Founder and President of the Florida Policy Project, a nonpartisan public-policy organization focused on practical solutions to Florida’s most significant challenges. He represented Pinellas County in the Legislature for 12 years, including 10 years in the Senate.
Ed. Note: The Florida Policy Project is a strategic advertising partner of Extensive Enterprises, the holding company that owns Florida Politics.
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