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Amendment 3 Passes Statewide, Putting $3.3 Million in Fernandina Beach Tax Revenue at Risk
More than 74% of Nassau County voters backed the expanded homestead exemption, which could cost Fernandina Beach millions in annual property tax revenue.
FERNANDINA BEACH — Nassau County voters overwhelmingly approved a constitutional amendment Tuesday that could cost Fernandina Beach an estimated $3.3 million annually in property tax revenue, more than twice the $1.5 million financial cushion city commissioners built into their newly adopted budget.
Amendment 3 received 36,781 votes, or 74.07%, in Nassau County, compared with 12,874 votes, or 25.93%, against it. All 18 precincts reported, although the preliminary results exclude provisional ballots.
Statewide, the amendment passed with 61.99% of the vote, clearing the 60% threshold required to amend Florida's Constitution. Nassau County's approval rate was 12.08 percentage points higher than the statewide result.
City Manager Sarah Campbell warned commissioners in June that expanding Florida's homestead exemption to $250,000 could reduce Fernandina Beach's annual property tax collections from approximately $21.2 million to $17.9 million, a 15.6% decline.
Based on 2025 property values, Campbell estimated the exemption would remove $821.6 million from the city's taxable property value.
The amendment increases the homestead exemption for non-school property taxes to $150,000 in 2027 and $250,000 in 2028. Campbell estimated the first increase would cost the city approximately $1.98 million annually, rising to $3.3 million with the larger exemption.
Those estimates predate the city's adoption of a higher property tax rate and updated property assessments. Actual losses will depend on future property values, exemptions and tax rates.
The expanded exemption applies to property taxes other than school district taxes. The amendment also reduces the annual cap on assessment increases for non-homesteaded properties from 10% to 5% for non-school taxes, potentially reducing city revenue further.
Property taxes fund police and fire protection, emergency services, parks, street maintenance and capital improvements. Campbell said in June that property taxes accounted for approximately 47% of the city's $45.2 million General Fund budget at that time.
In September, city commissioners voted 4-1 to approve a $228 million budget for fiscal year 2026-27 and a property tax rate of 4.8530 mills, 9.24% above the rollback rate. Vice Mayor Darron Ayscue opposed the budget.
The higher rate generates approximately $1.5 million more than Campbell's original proposal. Commissioners placed the additional revenue in contingency, increasing the General Fund contingency budget to $2.04 million.
Commissioners adopted the higher rate amid concerns over the loss of paid parking revenue, waterfront redevelopment costs and the possibility that voters would approve the homestead exemption.
The potential $3.3 million annual tax loss exceeds the additional revenue commissioners set aside and could force another review of city spending and capital projects.
City officials could respond by reducing spending, delaying projects, finding other revenue sources or adjusting future property tax rates. No specific cuts have been adopted in response to Tuesday's vote.
Supporters of Amendment 3 argued that homeowners needed relief from rising housing costs, insurance premiums and property taxes. Local governments warned that expanding exemptions without replacing lost revenue could jeopardize services and infrastructure spending.
Qualifying homeowners will pay taxes on less of their property's assessed value, although individual savings will depend on assessments and local tax rates.
Campbell urged commissioners in June to begin preparing for the potential revenue losses.
"My recommendation is that our September 1 workshop discuss what our approach might look like for the '28 and '29 budgets so that the public has an understanding of the types of things that we will consider to adjust our budgets," Campbell said.
She said the changes would not affect the city's 2026-27 budget.
The city will need updated revenue projections reflecting current property values, the adopted 4.8530-mill tax rate and the amendment's provisions.
The first exemption increase takes effect for the 2027 tax year, leaving commissioners to address the potential revenue loss during the next budget cycle.
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Mark Tomes
Besides the revenue loss to municipalities, let's not forget what else Amendment 3 does: reduces taxes on second and third homes, rental properties, commercial properties, Airbnb's, etc. (a giveaway to wealthy people, at our expense); puts narrower restrictions on where property taxes can be used by municipalities, threatening purchasing and maintaining lands for conservation, providing services to citizens, etc.; restricts municipalities from changing tax exemptions in the future (reduces local control). It also doesn't address the bigger problem of multimillionaires and billionaires sucking more of the wealth out of the middle class; in fact, it just makes it worse.
Yesterday at 2:47 PM Report this
RobertR
News Alert City Officials.....Amendment 3 has passed. It is no longer a "possibility" but a reality. You could address this by reducing spending. Just as when a businesses gross sales are reduced by whatever event inorder to preserve the business, you cut costs or find new revenue sources. Office overhead,salaries,perks,etc. You just donot raise your fees and risk loosing customers. Stop with the shell games on tax collections,i.e.milliage rates,etc. The explosion of new revenue sources in new construction on Amelia Island has passed. The time for a budgetary diet has arrived.
44 minutes ago Report this
FloridaMike
74% of Nassau County voters made it pretty clear they demand property tax relief.
That $3.3 million isn’t magic money. It’s $3.3 million of hardworking residents’ money. We have to live within our means, and the city should too. Every time the city raises taxes, they’re essentially saying they deserve that money more than the people who earned it.
Fernandina Beach’s General Fund spending has grown 65% in just six years, from $21 million in 2020 to $35 million in 2026. That’s twice the rate of inflation!
To be clear, that increase is in the General Fund alone and doesn’t include the city’s separately budgeted infrastructure and capital projects.
The city’s day-to-day spending is completely out of hand. It’s time for the City Commission to stop looking for more ways to raise taxes and start figuring out how to spend less. Do better!
Instead of complaining about “losing” $3.3 million, maybe it’s time to figure out how to spend less and celebrate that residents get to keep more of the money they’ve earned.
I hope the City Commission respects the …
24 minutes ago Report this