Florida voters approved sweeping property tax cuts under Amendment 3, leaving Central Florida communities to brace for municipal budget shakeups. A new Orlando Sentinel analysis quantifies the possible pain across the region as local governments prepare for the phased implementation beginning in 2027.
Howey-in-the-Hills faces looming cuts
According to the nonprofit Florida TaxWatch, the small community of Howey-in-the-Hills—located in mostly rural central Lake County and operating with a police force of seven full-time officers—will experience $936,752 in diminished property tax income by 2028 when the provisions of Amendment 3 take full effect. That translates to 22.5% of its roughly $4.2 million general fund, the Sentinel calculated.
The town’s general fund pays for its police, library, parks, and special events, including its popular Christmas Festival. In a Friday interview, Howey Mayor Graham Wells assured residents there is no danger the city would lose its police department or its festivals.
When Amendment 3 reductions were due to begin taking effect starting October 1 of 2027, Wells admitted the municipality will need to draw upon its reserve accounts. He noted that the second year presents a different challenge.
“It’s not going to impact us from paying the bills, but the second year is a completely different ball game,” Mayor Graham Wells said.
Urban versus suburban budget impacts
Although every municipality statewide will have to confront Amendment 3 in some capacity, the impact is anticipated to be particularly challenging for bedroom towns and rural areas where a greater proportion of the tax base consists of residential properties subject to homesteaded property taxes.
The $150,000 homestead tax exemption established by Amendment 3 applies exclusively to those specific levies, increasing to $250,000 the year after. It doesn’t apply to property taxes that fund schools.
Orlando collects property taxes on downtown high-rises and commercial and industrial properties that don’t get the Amendment 3 tax benefits, alongside significant sales tax and business-related taxes. Orlando is projected to lose about $60 million in homestead property tax, which amounts to about 7.6% of its general revenues, the Sentinel calculated.
That loss is roughly six times as much as Belle Isle’s entire general fund. Belle Isle, a smaller neighbor to the south with a population of about 7,500 on the Conway Chain of Lakes, stands to give up about $2 million in tax revenue, representing 19% of its general fund.
Belle Isle Mayor Jason Carson said the city has a spending freeze in place as it assesses the fallout. Among the outlays Belle Isle would eagerly trim is the fee it pays Orange County for fire services, with officials pointing out that this cost has climbed upwards of 80% over a roughly five-year span while service calls have remained relatively flat.
Oviedo faces significant revenue losses and police consolidation discussions
Farther east in upper middle-class Oviedo, just over 66% of taxable properties are homesteaded parcels. Mayor Megan Sladek noted that difficult decisions lie ahead for Oviedo, given that the municipality faces general fund revenue losses exceeding $10.4 million in 2028, representing nearly 23% of its current budget of approximately $46 million.
Sladek highlighted the fact that the Seminole County Sheriff’s Office serves the county while each of Seminole’s seven municipalities maintains an independent police agency. She called for a full discussion on whether it makes sense to have eight law enforcement agencies.
For its analysis, the Sentinel gathered general fund figures from city and county budgets for the current fiscal year and evaluated them against the revenue reductions estimated by Florida TaxWatch. Once the rollout of Amendment 3 reaches completion in 2028, the projected revenue shortfalls will span from 4% of Eatonville’s general fund up to 32% for Lake County. Eatonville takes a relatively small hit because so much of its population is renters.
Records from the Seminole Property Appraiser’s Office indicate that homesteaded parcels make up over 70% of Winter Springs’ taxable real estate, meaning the municipality anticipates roughly $4.5 million in lost revenue by 2028—accounting for slightly more than 16% of its $26.3 million general fund budget.
“We are very fiscally responsible. So there’s just very little to cut, but we’re going to have to replace those revenues. Everything is on the table … . And it’s going to affect employee morale. And [employee] retention is already difficult for municipal governments,” said Winter Springs Mayor Kevin McCann.
