Florida weighs ditching property taxes and sticking Canadians with the bill

Florida weighs ditching property taxes and sticking Canadians with the bill

'I don't want to give Canadians a tax cut,' Florida governor says as he pushes to end property taxes for some

Florida voters are weighing whether to scrap residential property taxes and the state's governor has a solution to that potentially huge revenue loss: tax Canadians more.

Canadians who own property in Florida describe the threats to shake them down for more money as just the latest insult in a series of them since U.S. President Donald Trump returned to power last year with a decidedly anti-Canada agenda.

Republican Gov. Ron DeSantis has railed against property taxes, which fund local governments and the services they provide — law enforcement, fire, EMS, disaster preparation and mosquito control, among many others — equating them to a form of modern-day feudalism where homeowners must "pony up money to the government just for the courtesy of using your own property."

To end this, DeSantis is pushing Amendment 3, a ballot measure crafted by his Republican statehouse allies that will be put to voters in the midterm election next month.

If passed, Florida "homesteaders," as permanent residents are called, will see a dramatic increase in an existing property tax exemption.

Any Floridian with a primary residence valued at $250,000 US or less — about 60 per cent of all homesteaders, according to the governor's office, although that figure has been questioned — would pay nothing and those with a home worth more than that would pay much less than they do now. The measure also calls on the state to eliminate homesteader property taxes entirely over time.

This constitutional amendment requires a 60 per cent supermajority, and at least one recent poll suggests it will easily clear that hurdle.

State economists project such a move will cost about $12 billion US annually, forcing local and county governments that depend on these taxes to make deep cuts, find new revenue elsewhere or both.

That's where things could get more expensive for the Canadians who own an estimated $60 billion US worth of property in the Sunshine State. DeSantis has explicitly described them as a resource to tap to close expected budget gaps.

"We need to focus on our Florida residents. And focus on, in this case, Florida homeowners, particularly our homesteaded homeowners, and we need to focus the relief there," DeSantis said at a news conference last year defending his call for lower property taxes instead of a sales tax cut.

"I want Canadian tourists and Brazilian tourists subsidizing the state and making it so Florida residents pay less taxes. I don't want to give Canadians a tax cut."

In an interview with Fox Business in June, DeSantis said that while homesteader property tax revenue will be a fraction of what it once was if the measure passes, Canadian property owners won't see any of that relief, which could help pad local coffers.

"They tax property that is non-homestead: residential, Airbnb, Canadian snowbirds, commercial. That's a lot of money that they have," DeSantis said of local and county governments.

While reducing taxes for Floridians, the ballot measure also dictates that the assessed value of a non-homesteaded property — owned by a Canadian or another non-resident — can increase by up to 5 per cent a year, steadily raising the revenue local governments can collect.

"They are going to start getting more revenue from existing taxes without having to add new taxes and they're going to end up in a very stable situation very shortly," DeSantis said.

DeSantis has routinely poked at Canada — including its perennially losing hockey teams. He initially mocked the trade war-induced travel boycott, saying he didn't think it would meaningfully materialize, only to see his state tourism bureau report a double-digit drop in Canadian arrivals last year.

Some Canadians who have put down seasonal roots in the state have had enough of the taunts.

Glenn McGill of Wiarton, Ont., has been wintering in North Fort Myers, Fla., a community once well-populated with fellow Canadian sunseekers, for the last 15 years.

But after Trump's second win there's been what he describes as a "stampede" of Canadians out of the park he and his wife Deb long thought of as a second home.

He says there are only four Canadians left in the sprawling retirement community, a fraction of what there once was when he first started going south.

Some snowbirds want out of Florida. A bad housing market makes it hard to leave

McGill said DeSantis's threat to lean on Canadians to make up for lost property tax revenue will only drive more of them away, including himself — he listed his home for sale.

"They're a greedy bunch of SOBs," McGill said in an interview with CBC News. "They want to drive Canadians out."

"Those who are well off really don't care but we're not rich, we're not broke, we can do the Florida thing comfortably, but starting to pay extra taxes — that would hurt," he said.

"And this political thing with Trump, I've had enough of it."

With so many Canadians leaving or staying away, McGill says the housing market in Florida has been tough to navigate as a seller.

"The market's pretty dry," he said. "It's listed, but it hasn't sold yet."

Canadians make up the vast majority of foreign property buyers in areas along Florida's Gulf Coast.

According to Realtor.com data, Canadians represent more than 70 per cent of international demand in the Cape Coral metropolitan area, which includes McGill's community.

And with Canadian sales nowhere near pre-trade war levels, the firm says local sellers face "real pricing pressure" with properties listed for weeks longer than the national average.

The areas of Florida that have historically attracted the most Canadian interest are projected to see the largest drop in home prices this year, according to the firm's projections.

Edie Ousley, a spokesperson for Vote No on 3, a group opposing the property tax ballot measure, anticipates more housing market shocks given a possible flood of new Canadian-owned home listings if this tax change takes effect.

"Gosh, it wouldn't surprise me if there's an exodus of Canadians — they are going to be hit significantly," Ousley said in an interview.

"Amendment 3 is a train wreck. It's a train wreck for Floridians. It's a train wreck for those who come in the winter. Those Canadian snowbirds are going to be impacted with additional taxes — this is a tax shift, it's not tax relief," she said.

Ousley said a shrinking Canadian population base alone can't replace what will be lost if homestead taxes disappear.

Many municipalities are already warning that a sudden erosion in their tax base will decimate public services, most notably law enforcement and 911 response times.

"Everyone is going to lose with cuts," she said.

John May of Ottawa offloaded his Key West, Fla., condo after getting sick of hearing people he thought were friends parrot Trump's harsh rhetoric about Canada.

He said he felt like he was swimming in "a sea of stupidity" with falsehoods about his country commonplace.

"Trump would say something stupid, Governor Trudeau, 51st state and all that, and they'd stand there and laugh and I'd say to myself, 'Well, I just lost all respect for you,'" May said in an interview.

"And then you start avoiding people because you know what the conversation is going to be. If you try and have a logical discussion with somebody who's a Trumper, just forget about it," he said.

Jo-Ann Rowe, a Canadian who was wintering in Fort Lauderdale for years with no issue before Trump's return, had the same experience.

"The 51st state thing, my American friends all thought that was quite funny. And I really don't," she said.

She left Florida for a rental property in Puerto Vallarta, Mexico. "I found it totally disrespectful. And I just couldn't do it anymore, this was my little part to do," she said.

Lilly White of Almonte, Ont., spent the last 25 years going to Tarpon Springs, Fla., near Tampa and then Flagler Beach on the other side of the state to escape Canadian winters.

White describes her time there in glowing terms, but said things changed dramatically in the Trump 2.0 era and she had to leave.

"It's not that we don't like it. We're just uncomfortable now. We'll always love the U.S. They'll always be our neighbours. They will always be friends. That's a choice we can make. But we can also choose not to fall down the rabbit hole of what's going on over there right now," she said in an interview.

White said any move to take more property taxes from Canadians is unfair to those who have pumped a lot of money into the state's economy over the years.

The many small businesses that rely on an influx of Canadian snowbirds are surely hurting as visitor figures plummet amid the bilateral bad blood, she said.

Canadians are by the far largest single source of international tourism to the state, and the number of trips dropped by 20 per cent in the prime winter season this year, data shows.

"I can't imagine how much the businesses are losing. I know how many of my friends are not going down anymore. And we were big spenders," she said.

J.P. Tasker is a journalist in CBC's parliamentary bureau who reports for digital, radio and television. He is also a regular panellist on CBC News Network's Power & Politics. He covers the Conservative Party, Canada-U.S. relations, the Crown in Canada, health policy and the Senate. You can send story ideas and tips to J.P. at jp.tasker@cbc.ca