CITY COUNCIL AGENDA ITEM
Memo Date: October 22, 2024.
Agenda Date: November 12, 2024.
Prepared By: Jennifer Webster, City Planner
Through: Stockton Whitten, City Manager
Requested Action:
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Consideration of a Resolution of the City of Cocoa, Florida, electing to not exempt certain property from ad valorem taxation, as allowed under section 196.1978(3)(o), Florida Statutes, providing for conflicts, severability, and an effective date.
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BACKGROUND:
LIVE LOCAL ACT
Florida’s Live Local Act was created by Senate Bill 102 and became effective on July 1, 2023. Section 3 of the Live Local Act (LLA) created new subsection (7) in Section 125.01055, Florida Statutes, which relates to affordable housing.
The statute permits a development project to be exempted from a municipality’s established zoning requirements such as maximum density, height, and allowable uses, to increase the availability of affordable housing. It also allows these developments to be built in zoning districts not designated for residential development such as Commercial and Industrial zoning districts. This can often be contrary to the municipality’s established Future Land Use pattern and the mandated Comprehensive Plan. The act provides for administrative approval of residential and mixed-use multifamily rental developments in which at least 40 percent of the residential units are, for a period of at least 30 years, affordable as defined in Florida Statutes.
With regard to local government control, the bill also:
• Removes a local government’s ability to approve affordable housing on residential parcels by bypassing state and local laws that may otherwise preclude such development, while retaining such right for commercial and industrial parcels.
• Removes provision in current law allowing local governments to impose rent control under certain emergency circumstances, preempting rent control ordinances entirely.
• Requires counties and cities to update and electronically publish the inventory of publicly owned properties which may be appropriate for affordable housing development.
• Authorizes the FHFC, through contract with the Florida Housing Coalition, to provide technical assistance to local governments to facilitate the use or lease of county or municipal property for affordable housing purposes.
• Requires local governments to maintain a public written policy outlining procedures for expediting building permits and development orders for affordable housing projects.
The bill also introduced three ad valorem property tax exemptions, including:
• Authorizing counties and municipalities to offer, through ordinance, an ad valorem tax exemption to property owners who dedicate units for affordable housing for households earning 60 percent of the AMI (area medium income) or less.
AMENDED IN 2024
The LLA was amended in 2024 by Florida Senate Bill (SB) 328 and companion House Bill (HB) 7073. This became Chapter 2024-158, Laws of Florida. Among the changes to SB 328 was regarding the methodology for property appraisers to determine values of tax-exempt units, as such:
“Qualified property may receive an ad valorem property tax exemption of:
1. Up to 75 percent of the assessed value of each residential unit used to provide affordable housing if fewer than 100 percent of the multifamily project’s residential units are used to provide affordable housing meeting the requirements of this section [of the legislation].
2. Up to 100 percent of the assessed value of each residential unit used to provide affordable housing if 100 percent of the multifamily project’s residential units are used to provide affordable housing meeting the requirements of this section [of the legislation].”
HB 7073 - AD VALOREM “OPT OUT” PROVISION
Section 16 of Chapter 2024-158, Laws of Florida, and F.S. Section 196.1978(o), provides that a taxing authority (including the City) starting with the 2025 tax roll, is authorized to opt out of providing the aforementioned tax exemptions for these projects under the Live Local Act, if the following criteria are met:
1. The City of Cocoa must be in a county in which the number of affordable and available units for households at or below 120% AMI is greater than the number of households at that income level, as determined by the most recent Shimberg Center for Housing Studies Annual Report.
The City of Cocoa in Brevard County is located within the Palm Bay-Melbourne-Titusville, Florida Metropolitan Statistical Area (MSA). The data in this Report shows that in this MSA, the number of affordable and available units is in fact greater than the number of renter households MSA in the 0 to 120 percent (AMI) category. This qualifies the City of Cocoa as eligible to opt-out of providing the tax exemptions. (see Report excerpt, provided below).
2. This resolution to opt out from providing the property tax exemption must be approved by a two-thirds vote by City Council.
3. This Resolution must be duly advertised in accordance with Section 50.011(1), Florida Statutes. This item was advertised as required by Florida Statute on November 7, 2024. The affidavit for the advertisement is attached.
Shimberg Center for Housing Studies, 2023 Annual Report, available at:
<http://www.shimberg.ufl.edu/publications/Shimberg_annual_report_Dec_2023.pdf>
(For reference, the full texts of SB 102 can be found in Exhibit ‘A’. The full text of SB 38 can be found in Exhibit ‘B’. The full text of HB 7073 can be found in Exhibit ‘C’.)
PRIORITY AREA CONNECTION:
Economic and Community Development.
BUDGETARY IMPACT:
Budgeted N/A
PREVIOUS ACTION:
N/A
RECOMMENDED MOTION:
Recommendation
Staff recommends City Council APPROVE this Resolution of the City of Cocoa, Florida, electing to not exempt certain property from ad valorem taxation, as allowed under section 196.1978(3)(o), Florida Statutes, providing for conflicts, severability, and an effective date