Jacksonville Adopts Property Tax Discounts for Affordable Housing

As the demand for affordable housing in Florida has increased, the City of Jacksonville recently adopted an innovative policy tool that will begin to address housing affordability. The Florida Apartment Association (FAA) has conducted expansive research into property tax discounts for affordable housing and has, for several years now, advocated for state lawmakers to pass legislation to allow local governments to leverage this creative tool to address housing supply needs. The Live Local Act (SB 102) was a product of Senate President Kathleen Passidomo’s passion for housing attainability, along with FAA’s advocacy. The passing of SB 102 at the state level during the 2023 legislative session gave local governments the ability to adopt an optional property tax discount for affordable and low-income housing. After the Live Local Act was signed into law, then-Jacksonville Councilwoman Joyce Morgan sponsored Ordinance 2023–349, which adopts the local optional property tax discount to encourage the development of affordable and low-income housing in Jacksonville.

In 2021, FAA, in partnership with HR&A Advisors, released a research project titled “Property Tax Discounts and Their Effect on Housing Affordability”, which explains how property tax discounts can positively affect the feasibility and financial viability of developments that include affordable housing. The research study analyzed multifamily housing development and demographic data across four urban metropolitan statistical areas in Florida (Jacksonville, Miami, Orlando, & Tampa). For each region, the study estimated the initial, direct, indirect, and induced impacts of increased discretionary household income through rent savings, as well as the one-time construction impacts of property tax discounts at several percentage tiers. 

The research study revealed that property discounts of at least 25 percent or more encourage the development of affordable and workforce housing within market rate apartment communities. Further, the study found that property tax discounts spur state and local economic growth by creating jobs and increasing overall economic activity. According to FAA’s research, an estimated 350 new affordable or workforce housing units can be expected to be developed in Jacksonville. The data shows that Jacksonville also has the potential to create 56 new jobs with an increase of $6.2 million in economic activity.

The Live Local Act is one of the most important and expansive pieces of housing policy legislation in Florida’s history. SB 102 was signed into law on March 29, 2023 by Governor DeSantis and took effect July 1, 2023. Jacksonville is the first local government in the state to adopt the optional property tax discount. Property tax discounts are only available for apartment communities that have at least 50 units. The ordinance provides a tax discount of 75 percent on each unit that is set aside for affordable and low-income housing. At least 20 percent of the units must be set aside for residents that earn between 30 and 60 percent of the area median income. There is also an option for the city to exempt 100 percent of the taxes if all the units at the property are restricted for those earning an income in the same range mentioned above.

The property tax discounts will be available beginning with the 2024 tax roll and eventually expire at the end of 2026. However, the city council does have the ability to extend the tax discount. Each property wanting to claim the discount must apply each year with the Neighborhoods Department by January 15. The following documentation will also be required upon application:

• The most recently completed rental market study.

• A list of the units for which the property owner is seeking an exemption.

• The rent amount received by the property owner for each unit for which the property owner seeks an exemption, and if a unit is vacant and qualifies for an exemption, the property owner must provide evidence of the published rent amount for the vacant unit.

Jacksonville is still working on a website that will include all the information required for property owners to submit an application for the discount. As more information is released, FCAA will keep members informed on any updates to the city’s property tax discount program. For questions on this advocacy update or to become more involved in First Coast Apartment Association’s advocacy efforts, please contact local Government Affairs Manager, Johnmichael Fernandez | 407-960-2910 | JohnmichaelJohnmichael@faahq.org.