Wyoming and Florida voters come to different conclusions on property tax reform

Property taxes were on the ballot in a handful of states yesterday, essentially asking voters to either prioritize financial relief for homeowners or better fund public services, like fire departments, sheriff’s offices, and libraries.

Two of the larger measures were in Wyoming and Florida. And while Florida voted for a property tax exemption, Wyoming voted against one.

Wyoming is considered the most conservative state in the country, and generally prefers lower taxes. But last night, residents voted overwhelmingly against a 50% cut in property taxes.

“I think we all knew it was going to be close. I thought it might be a little closer than this,” said Hank Hoversland, executive director of the Wyoming Taxpayers Association.

He thinks the vote was in response to a previous property tax cut that took a toll on public services.

“We've seen closures of libraries on certain days, slower service in emergency services like fire or inability to maintain their equipment,” he said.

Those cuts could’ve gotten much worse had the latest tax cut passed. That’s what happened in Florida last night.

“I don't think I envy Florida in what they're going to be experiencing,” Hoversland said.

Florida voters approved a tax exemption on as much as $250,000 of a home’s value. For Florida's county and city budgets, that translates to billions in revenue lost annually.

The Tax Foundation’s Jared Walczak said there’s a few ways to respond.

“They can cut spending, they can raise property tax rates on all the property that remains in the base or they can raise other taxes and fees,” he said.

The second option — raising rates on higher-value property — is actually kind of progressive, said Christopher Berry, a professor at the University of Chicago’s Harris School of Public Policy. That’s because it would benefit people who own the lower-valued properties.

Berry said that’s meaningful at a time when everything's really expensive — especially housing.

“Generally speaking, property taxes are the second biggest component of your home ownership costs, right after the mortgage. And property taxes go up over time, where as your mortgage payment doesn’t,” he said.

The tax is typically attached to home values which have gone up in a lot of places post-COVID, said David Merriman, a professor at the University of Illinois Chicago’s College of Urban Planning and Public Affairs. “Areas where they've had the most appreciation kind of feel it the most. They see big increases, and that's when you get big movements to reform property taxes.”

Merriman said what it comes down to is how much government and public services do you want? And how do you want to pay for it?