The Florida Senate
BILL ANALYSIS AND FISCAL IMPACT STATEMENT
(This document is based on the provisions contained in the legislation as of the latest date listed below.)
Prepared By: The Professional Staff of the Committee on Community Affairs
BILL: SB 328
INTRODUCER: Senator Calatayud
SUBJECT: Development
DATE: January 8, 2024
ANALYST STAFF DIRECTOR REFERENCE ACTION
1. Hunter Ryon CA Pre-meeting
2. FP
I. Summary:
SB 328 amends various provisions of the Live Local Act (act), passed during the 2023 Regular
Session, which made substantial changes and additions to affordable housing related programs
and policies at both the state and local level.
As it pertains to the act’s preemption of certain local zoning and land use regulations to expedite
development of affordable housing, the bill:
Removes the directive for local governments to approve qualified developments in industrial
areas, leaving the provisions applicable only to areas zoned for commercial and mixed-use.
Preempts a local government’s “floor area ratio” for qualified developments.
Limits the height preemption by entitling qualified developments to the highest currently
allowed height for a building within one-quarter mile (instead of one mile) and provides
additional considerations if the height of all adjacent buildings are three stories or less.
Prohibits qualified developments within one-quarter mile of a military installation from
utilizing the act’s administrative approval process and exempts certain airport impacted areas
from the act’s provisions.
Clarifies that a local government’s “currently allowed” density, height, and floor area ratio
does not include any bonuses, variances, or other special exceptions provided in their
regulations.
Requires developments authorized under the act be treated as a conforming use even after
expiration of the development’s affordability period and after the expiration of the applicable
statutes.
As it pertains to the act’s ad valorem tax exemption for newly constructed multifamily
developments, the bill makes the following changes:
Clarifies that “substantially renovated” units may qualify for the exemption, and provides a
definition.
REVISED: BILL: SB 328 Page 2
Requires 10 units, rather than 70 units, to be set aside for income-limited persons and
families in Florida Keys qualify for the exemption.
Clarifies that the Florida Housing Finance Corporation’s (FHFC) duties are ministerial in
certifying eligibility for exemption, while local property appraisers maintain authority to
grant tax exemptions.
Outlines the method for property appraisers to determine values of tax exempt units.
The bill appropriates $100 million in non-recurring funds from the General Revenue Fund to the
FHFC to administer the Florida Hometown Hero Program and makes one administrative
programmatic change for more efficient administration.
The bill takes effect upon becoming a law.
II. Present Situation:
Affordable Housing
One major goal at all levels of government is to ensure that citizens have access to affordable
housing. Housing is considered affordable when it costs less than 30 percent of a family’s gross
income. A family paying more than 30 percent of its income for housing is considered “cost
burdened,” while those paying more than 50 percent are considered “extremely cost burdened.”
What makes housing “affordable” is a decrease in monthly rent so that income eligible
households can pay less for the housing than it would otherwise cost at “market rate.”
1
Lower
monthly rent payment is a result of affordable housing financing that comes with an enforceable
agreement from the developer to restrict the rent that can be charged based on the size of the
household and the number of bedrooms in the unit.
2
The financing of affordable housing is made
possible through government programs such as the federal Low-Income Housing Tax Credit
Program and the Florida’s State Apartment Incentive Loan program.
3
Resident eligibility for Florida’s state and federally funded housing programs is typically
governed by area median income (AMI) levels. These levels are published annually by the U.S.
Department of Housing and Urban Development for every county and metropolitan area.
4
Florida Statutes categorizes the levels of household income as follows:
Extremely low income – households at or below 30% AMI;
5
Very low income – households at or below 50% AMI;
6
Low income – households at or below 80% AMI;
7
and
Moderate income – households at or below 120% AMI.
8
1
Florida Housing Coalition, Affordable Housing in Florida, p. 3, available at: https://flhousing.org/wp-
content/uploads/2022/07/Affordable-Housing-in-Florida.pdf (last visited Jan. 6, 2024).
2
Id.
3
Id.
4
U.S. Department of Housing and Urban Development, Income Limits, Access Individual Income Limits Areas – Click Here
for FY 2023 IL Documentation, available at https://www.huduser.gov/portal/datasets/il.html#2021 (last visited Jan. 8, 2024).
5
Section 420.0004(9), F.S.
6
Section 420.0004(17), F.S.
7
Section 420.0004(11), F.S.
8
Section 420.0004(12), F.S. BILL: SB 328 Page 3
Florida Housing Finance Corporation
The Florida Housing Finance Corporation (FHFC) is a public-private entity created by the
Legislature in 1997 to assist in providing a range of affordable housing opportunities for
Floridians.
9
The FHFC is a corporation held by the state and housed within the Department of
Commerce (department). The FHFC is a separate budget entity and its operations are not subject
to control, supervision, or direction by the department.
10
The goal of the FHFC is to increase the supply of safe, affordable housing for individuals and
families with very low to moderate incomes by stimulating investment of private capital and
encouraging public and private sector housing partnerships. As a financial institution, the FHFC
administers federal and state resources to finance the development and preservation of affordable
rental housing and assist homebuyers with financing and down payment assistance.
Zoning and Land Use Preemption for Affordable Developments
The Growth Management Act requires every city and county to create and implement a
comprehensive plan to guide future development.
11
All development, both public and private,
and all development orders
12
approved by local governments must be consistent with the local
government’s comprehensive plan unless otherwise provided by law.
13
The Future Land Use
Element in a comprehensive plan establishes a range of allowable uses and densities and
intensities over large areas, and the specific use and intensities for specific parcels
14
within that
range are decided by a more detailed, implementing zoning map.
15
The Live Local Act (act)
16
preempts certain county and municipal zoning and land use decisions
to encourage development of affordable multifamily rental housing in targeted land use areas.
Specifically, the act requires counties and municipalities to allow a multifamily or mixed-use
residential
17
rental development in any area zoned for commercial, industrial, or mixed-use if the
development meets certain affordability requirements.
18
To qualify, the proposed development
9
Chapter 97-167, Laws of Fla. From 1980 through 1997, the former Florida Housing Finance Agency, placed within the
former Department of Community Affairs, performed similar duties.
10
Section 420.504(1), F.S.
11
Section 163.3167(2), F.S.
12
“Development order” means any order granting, denying, or granting with conditions an application for a development
permit. See s. 163.3164(15), F.S. “Development permit” includes any building permit, zoning permit, subdivision approval,
rezoning, certification, special exception, variance, or any other official action of local government having the effect of
permitting the development of land. See s. 163.3164(16), F.S.
13
Section 163.3194(3), F.S
14
When local governments make changes to their zoning regulations or comprehensive plans some structures may no longer
be in compliance with the newly approved zoning and may be deemed a “nonconforming use.” A nonconforming use or
structure is one in which the use or structure was legally permitted prior to a change in the law, and the change in law would
no longer permit the re-establishment of such structure or use.
15
Richard Grosso, A Guide to Development Order "Consistency" Challenges Under Florida Statutes Section 163.3215, 34 J.
Envtl. L. & Litig. 129, 154 (2019) citing Brevard Cty. v. Snyder, 627 So. 2d 469, 475 (Fla. 1993).
16
The “Live Local Act”, Ch. 2023-17, Laws of Fla., made various changes to affordable housing related programs and
policies at the state and local levels, including zoning and land use preemptions favoring affordable housing, funding for state
affordable housing programs, and tax provisions intended to incentivize affordable housing development.
17
For mixed-use residential, at least 65 percent of the total square footage must be used for residential purposes.
18
See ss. 125.01055(7) and 166.04151(7), F.S. BILL: SB 328 Page 4
must reserve 40 percent of the units for residents with incomes up to 120% AMI, for a period of
at least 30 years.
Additionally, the local government may not restrict the density
19
of qualifying developments
below the highest allowed density on land within its jurisdiction where residential development
is allowed, and may not restrict the height below the highest currently allowed height for a
commercial or residential development in its jurisdiction within 1 mile of the proposed
development or 3 stories, whichever is higher.
20
An application for a development must be administratively approved and no further action is
required from the governing body of the local government if the development satisfies the local
government’s land development regulations for multifamily in areas zoned for such use and is
otherwise consistent with the jurisdiction’s comprehensive plan.
A local government must consider reducing parking requirements for these developments if they
are located within one-half mile of a major transit stop, as such term is the local government’s
land development code, and the major transit stop is accessible from the development.
These provisions do not apply to recreational and commercial working waterfronts in industrial
areas,
21
and only mixed-use residential developments must be authorized under these provisions
in areas where commercial or industrial capacity is exceptionally limited.
22
These provisions are effective until October 1, 2033.
Ad Valorem Exemption for Newly Constructed Developments
The ad valorem tax
23
or “property tax” is an annual tax levied by counties, municipalities, school
districts, and some special districts based on the taxable value of property as of January 1 of each
year.
24
The Florida Constitution allows the Legislature to exempt from ad valorem taxation
portions of property that are used predominantly for educational, literary, scientific, religious or
19
“Density” means an objective measurement of the number of people or residential units allowed per unit of land, such as
residents or employees per acre, See s. 163.3164(12), F.S.
20
While the act expressly preempted density, it did not address intensity. Intensity is often measured in terms of floor area
ratio (FAR). FAR is the measurement of a building’s floor area in relation to the parcel or lot that the structure is built on. For
a general overview of FAR, see: Metropolitan Council, Local Planning Handbook, Calculating Floor Area Ratio, available
at: https://metrocouncil.org/Handbook/Files/Resources/Fact-Sheet/LAND-USE/How-to-Calculate-Floor-Area-Ratio.aspx
(last visited Jan. 5, 2024).
21
Sections 125.01055(7)(h) and 166.04151(7)(h), F.S.
22
Sections 125.01055(7)(f) and 166.04151(7)(f), F.S.
23
For an in depth review of ad valorem taxation and the specific taxes discussed herein, see Florida Senate Committee on
Appropriations, Bill Analysis and Fiscal Impact Statement, CS/SB 102 (2023) pages 30-34, Feb. 24, 2023, available at
https://flsenate.gov/Session/Bill/2023/102/Analyses/2023s00102.ap.PDF (last visited Jan. 7, 2024).
24
Both real property and tangible personal property are subject to tax. Section 192.001(12), F.S., defines “real property” as
land, buildings, fixtures, and all other improvements to land. Section 192.001(11)(d), F.S., defines “tangible personal
property” as all goods, chattels, and other articles of value capable of manual possession and whose chief value is intrinsic to
the article itself. BILL: SB 328 Page 5
charitable purposes.
25
The Legislature has implemented these exemptions and set forth criteria to
determine whether property is entitled to an exemption.
26
The Live Local Act established a new ad valorem tax exemption for owners of newly
constructed multifamily rental developments who use a portion of the development to provide
affordable housing.
27
Eligible property includes units in a newly constructed multifamily
development containing more than 70 units dedicated to housing natural persons or families
below certain income thresholds. However, units subject to an agreement with FHFC are not
eligible for the exemption.
“Newly constructed” is defined as an improvement substantially completed within 5 years before
the property owner’s first application for this exemption. The units must be occupied by
individuals or families become income thresholds and rent limited so as to provide affordable
housing at either the 80 or 120 percent AMI threshold. Rent for such units also may not exceed
90 percent of the fair market value rent as determined by a rental market study.
Qualified property used to provide affordable housing at the 80 to 120 percent AMI threshold
receives an exemption of 75 percent of the assessed value of the affordable units, while such
property providing affordable housing up to the 80 percent AMI threshold receives a complete ad
valorem tax exemption for the affordable units.
To receive this exemption, a property owner must submit an application by March 1 to the
property appraiser, accompanied by a certification notice from the FHFC. To receive a FHFC
certification, a property owner must submit a request on a form including the most recent market
study, which must have been conducted by an independent certified general appraiser in the
preceding 3 years; a list of units for which the exemption is sought; the rent amount received for
each unit, and a sworn statement restricting the property for a period of not less than 3 years to
provide affordable housing.
The certification process is administered within the FHFC. Their responsibilities include
publishing the deadline for submission, reviewing each request, sending certification notices to
both the successful property owner and appropriate property appraiser, notifying unsuccessful
property owners with reasons for denial.
This exemption first applied to the 2024 tax roll and will expire on December 31, 2059.
Florida Hometown Hero Program
The Live Local Act established in statute the Florida Hometown Hero Program,
28
a
homeownership assistance program administered by the FHFC. Under the program, eligible first
time homebuyers have access to zero-interest loans to reduce the amount of down payment and
closing costs by a minimum of $10,000 and up to 5 percent of the first mortgage loan, not
exceeding $35,000. Loans must be repaid when the property is sold, refinanced, rented, or
25
FLA. CONST. art. VII, s. 3(a).
26
Section 196.196, F.S.
27
Section 196.1978(3), F.S.
28
Section 420.5096, F.S. BILL: SB 328 Page 6
transferred unless otherwise approved by the FHFC. Repayments for loans made under this
program must be retained within the program to make additional loans.
Such loans are available to those first-time homebuyers
29
seeking first mortgages whose family
incomes do not exceed 150 percent of the state or local AMI, whichever is greater, and is
employed full-time by a Florida-based employer. The borrower must provide documentation of
full-time employment, or full-time status for self-employed individuals, of 35 hours or more per
week.
The Live Local Act appropriated $100 million in non-recurring funds to the FHFC to implement
the Florida Hometown Hero Program for the 2023-2034 fiscal year.
30
The FHFC obligated the
full appropriation by August 22, 2023, assisting over 6,400 families and leveraging
approximately $2 billion in first mortgages.
31
III. Effect of Proposed Changes:
Live Local Zoning and Land Use Preemption
Sections 1 and 2 of the bill amend ss. 125.01055 and 166.04151, F.S., respectively, to modify
certain provisions pertaining to the zoning and land use preemption for approving affordable
multifamily rental developments.
First, the bill removes the directive for local governments to approve qualifying affordable
multifamily developments in industrial areas.
The bill additionally preempts counties and municipalities on “floor area ratio” for qualifying
developments. As such, a local government may not restrict the floor area ratio of a proposed
development below the highest currently allowed residential floor area ratio, pursuant to the
locality’s land development regulations.
The bill limits the height entitlements for qualifying developments by reducing the distance from
one mile to one-quarter mile. This change entitles a qualifying development to the highest
currently allowed height for a commercial or residential building within one-quarter mile
(instead of one mile) or three stories, whichever is higher. However, the bill provides that if the
height of each building on property adjacent to the proposed development is three stories or less,
the local government may restrict the height of the proposed development to 125 percent of the
tallest adjacent building or 3 stories, whichever is higher.
29
The requirement to be a first-time homebuyer does not apply to those qualifying as servicemembers or veterans.
30
Chapter 2013-17, s. 44, Laws of Fla.
31
See Florida Senate Committee on Community Affairs, Presentation by the Florida Housing Finance Corporation on its
implementation of the Live Local Act (SB 102 – 2023 Regular Session), Nov. 7, 2023, available at
https://www.flsenate.gov/Committees/Show/CA/MeetingPacket/5940/10486_MeetingPacket_5940_2.pdf (last visited Jan. 8,
2024).
BILL: SB 328 Page 7
The bill clarifies that the currently allowed density, height, and floor area ratio does not include
projects authorized under the Act or any bonuses, variances, or other special exceptions provided
in the local government’s land development regulations as incentives for development.
The bill provides that qualifying developments must be treated as a conforming use after
expiration of the development’s affordability period of at least 30 years and after the sunset of ss.
125.01055(7) and 166.04151(7), F.S., on October 1, 2033. However, if at any point during the
development’s affordability period the development violates the affordability requirement, the
development must be allowed a reasonable time to cure such violation. If the violation is not
cured within a reasonable time, the development must be treated as a nonconforming use.
The bill precludes a proposed development located within one-quarter mile of a military
installation identified in s. 163.3175(2), F.S., from being approved administratively.
Section 5 of the bill amends s. 333.03, F.S., to identify certain airport-impact areas where the
land use preemption provisions of the act do not apply. Specifically, ss. 125.01055(7) and
166.04151(7), F.S., do not apply to proposed developments:
Within 10,000 feet of the nearest point of any existing airport runway or planned airport
runway identified in the local government’s airport master plan;
Within any airport noise zone identified in the federal land use compatibility table; or
That exceeds maximum height restrictions identified in the political subdivision’s airport
zoning regulation adopted pursuant to this section.
Live Local Ad Valorem Exemption for Newly Constructed Developments
Section 3 of the bill amends s. 196.1978, F.S., to make the following changes to the ad valorem
tax exemption for newly constructed developments:
Clarifies that units that have been substantially rehabilitated may also qualify for the
exemption. “Substantial rehabilitation” means the repair or restoration of a unit which
increases the market value of such unit by at least 40 percent.
Requires fewer units in developments located in the Florida Keys
32
to be set aside for
income-limited persons and families (10 instead of 70). This acknowledges the stricter land
development regulations for that area as compared to the rest of the state.
Clarifies that FHFC duties are ministerial while property appraisers maintain the ultimate
authority to grant exemptions.
Outlines the method for property appraisers to determine values of exempted units in a
manner that is similar to other exemptions in statute.
As provided in section 4 of the bill, these changes are intended to be remedial and clarifying in
nature and apply retroactively to January 1, 2024.
32
As provided in the bill, “…an area of critical state concern, as designated by s. 380.0552 or chapter 28-36, Florida
Administrative Code…” refers to the City of Key West and the Florida Keys Area, which includes unincorporated Monroe
County and the municipalities of Layton, Islamorada, Marathon and Key Colony Beach. BILL: SB 328 Page 8
Florida Hometown Hero Program
Section 6 of the bill amends s. 420.5096, F.S., to remove the requirement that borrowers provide
documentation to the FHFC that their full-time employment or self-employment status equates to
35 hours or more per week.
Section 7 of the bill appropriates $100 million in nonrecurring funds from the General Revenue
Fund to the FHFC to implement the Florida Hometown Hero Program.
Effective Date
Section 8 provides that the bill shall take effect upon becoming a law.
IV. Constitutional Issues:
A. Municipality/County Mandates Restrictions:
Article VII, s. 18(b) of the Florida Constitution provides that except upon the approval of
each house of the Legislature by a two-thirds vote of the membership, the Legislature
may not enact, amend, or repeal any general law if the anticipated effect of doing so
would be to reduce the authority that municipalities or counties have to raise revenue in
the aggregate, as such authority existed on February 1, 1989. The mandate requirement
does not apply to laws having an insignificant impact,
33
which for Fiscal Year 2024-2025
is forecast at approximately $2.3 million.
34
The Revenue Estimating Conference has not reviewed the portions of the bill related to
the ad valorem tax exemption on newly constructed affordable housing.
B. Public Records/Open Meetings Issues:
None.
C. Trust Funds Restrictions:
None.
D. State Tax or Fee Increases:
None.
E. Other Constitutional Issues:
None.
33
FLA. CONST. art. VII, s. 18(d).
34
An insignificant fiscal impact is the amount not greater than the average statewide population for the applicable fiscal year
times $0.10. See FLA. SENATE COMM. ON CMTY. AFFAIRS, Interim Report 2012-115: Insignificant Impact (Sept. 2011),
available at: http://www.flsenate.gov/PublishedContent/Session/2012/InterimReports/2012-115ca.pdf. BILL: SB 328 Page 9
V. Fiscal Impact Statement:
A. Tax/Fee Issues:
None.
B. Private Sector Impact:
With the funding of the Florida Hometown Hero Program, Floridians who are first-time
homebuyers will have access to zero-interest loans to help pay for their downpayment
and closing costs.
C. Government Sector Impact:
The provisions amending the ad valorem tax exemption on newly constructed affordable
housing, which include substantially renovated improvements and a reduction in required
units in areas of critical state concern, are stated by the bill to be clarifying in nature, and
as such should not generate a fiscal impact. To the extent that this clarification attracts
further development or alters administration of the exemption, local governments may
see a negative impact.
The bill appropriates $100 million in non-recurring funds from the General Revenue
Fund to the Florida Housing Finance Corporation to implement the Florida Hometown
Hero Program.
VI. Technical Deficiencies:
None.
VII. Related Issues:
None.
VIII. Statutes Affected:
This bill substantially amends the following sections of the Florida Statutes: 125.01055,
166.04151, 196.1978, 333.03, and 420.5096.
This bill creates undesignated section of Florida law.
IX. Additional Information:
A. Committee Substitute – Statement of Changes:
(Summarizing differences between the Committee Substitute and the prior version of the bill.)
None. BILL: SB 328 Page 10
B. Amendments:
None.
This Senate Bill Analysis does not reflect the intent or official position of the bill’s introducer or the Florida Senate.