Street Economics

Arcadia, Florida

HJR 1 Homestead-Exemption Tax-Base Exposure

DeSoto County . 2025 final assessment roll

Snapshot

The Arcadia read

Arcadia carries the Balanced / Diversified archetype: a genuine mix of residential, commercial, and other uses with no single category overwhelming the base, which is the healthiest profile a Florida city can carry into this amendment. At full phase-in in 2028, 22.9% of the city’s non-school taxable base is exposed, stepping up from 18.5% at the 2027 threshold. The residential share takes a hit, but the commercial and rental base cushions it, which is exactly what a diversified base is supposed to do. Among ranked Florida cities, Arcadia sits at 201 of 404 by exposure, placing it squarely in the middle of the state distribution.

Of 2,797 residential housing units, 41.9% are owner-occupied, 10.2% are owned by out-of-state owners, and 48.0% are non-homestead but Florida-owned. That 48.0% Florida-owned non-homestead share is the dominant story in the ownership mix: this is a local rental market, not an absentee-ownership market, and that distinction matters for how the city thinks about housing policy alongside fiscal strategy.

Land-use composition

Share of taxable value by category, Arcadia, 2025 roll:

Two patterns stand out in the out-of-state columns. Multifamily shows 8.3% of parcels and 19.7% of value in out-of-state hands, meaning the out-of-state-owned multifamily properties tend to be larger and higher-value than the locally-owned ones. Commercial and Other/Vacant each show 14.4% of value out-of-state despite modest parcel counts, a similar dynamic. Industrial shows 10.0% of parcels out-of-state but only 3.7% of value, the reverse pattern: many small out-of-state-owned industrial parcels with limited aggregate value.

What the exposure band means

Moderate exposure. A meaningful but absorbable hit. The place has some non-homestead base to lean on. Mitigation is about steering future growth, not emergency response.

Looking ahead

Neither of the following changes the exposure figures above; both shape how Arcadia grows its base after the amendment takes effect.

First, beginning January 1, 2027, the annual assessment-increase cap on non-homestead property drops from 10% to 5%, covering commercial and industrial real property and small residential rentals of nine units or fewer. Because a capped property’s assessed value can only rise 5% per year, the main engine of base growth in these categories shifts to transactions: a sale or change of control resets the property to market value. Transaction velocity matters more to non-homestead base growth under the new cap than it did under the old one.

Second, new Florida residents who did not maintain a Florida permanent residence as of December 31, 2026 phase into the larger exemption over five years rather than receiving it immediately. This cannot be read from the assessment roll, so all exposure figures here assume full application of the exemption to every homestead. Near-term exposure could run slightly lower than modeled in places with many recent arrivals still inside their five-year window.

Where the opportunity is

These recommendations are based solely on the tax roll’s land-use composition. They do not account for whether local land development regulations and zoning permit any of these uses, whether there is local obstruction, or the political dynamics that typically decide what actually gets approved. This is a starting point for a conversation, not a development plan.

• Arcadia’s diversified base is its primary asset, and the first priority is maintaining that balance deliberately rather than letting it drift.
• The cushion the city has at 22.9% exposure exists because commercial, rental, and other non-homestead uses are already present in meaningful shares; that cushion erodes quietly if every new approval is another owner-occupied subdivision.
• The city should treat its current composition as a target to defend, not a baseline to take for granted.
• The diversified base is also a recruiting advantage that is underused.
• A city that can absorb this amendment without a services crisis is a more stable operating environment for businesses and investors than one facing a fiscal cliff.
• That stability is a legitimate economic-development signal worth putting in front of site selectors and developers.
• The next increment of growth should be steered toward whichever non-homestead category is thinnest.
• Industrial at 0.6% of total value and 20 parcels is the thinnest category in the roll, and adding even modest industrial square footage along established corridors or on vacant and converting land would broaden the base without tilting it back toward residential.
• Multifamily rental at 8.7% is the next candidate: adding rental units, particularly along arterial frontage or in the commercial core, deepens the Florida-owned rental base that already provides significant cushion.
• Commercial and rental growth should be directed into the established commercial core and corridors where it reinforces the existing diversified base rather than scattering it.
• Infill and conversion of Other/Vacant parcels, which represent 719 parcels at 2.0% of value, into commercial or multifamily uses is the most direct way to convert underperforming land into non-homestead taxable base without requiring greenfield development.

Watch-out: diversification erodes quietly if every approval is another subdivision. Arcadia should keep an explicit composition target and track it against the roll each year so the balance that provides the cushion does not slip away one approval at a time.

Source and scope

All figures are computed from the Florida Department of Revenue 2025 final assessment roll, the most recent certified roll in the state’s possession. The roll is used as a structural proxy for Arcadia’s tax-base composition, not as a dollar forecast for any specific budget year. HJR 1 / CS-HJR 1F is on the November 2026 ballot; the 2026 roll is the assessment roll in place when voters decide. If the amendment passes, the first roll affected by the larger exemption is the 2027 roll at the $150,000 step, followed by the 2028 roll at full $250,000 phase-in. When the 2026 and later rolls are certified, the analysis re-runs on the new data.

Ownership shares are measured on a residential-unit basis: each homestead-eligible parcel counts as one unit and each multifamily parcel counts by its number of apartment units. The out-of-state ownership figure is a mailing-address proxy; it undercounts true outside ownership because an out-of-state owner using an in-state LLC mailing address counts as Florida-owned, and it does not prove where any owner actually lives. This is a land-use-composition starting point, not a full fiscal, economic, or legal analysis.

Place: Arcadia, Florida