Florida TaxWatch, a prominent fiscal watchdog, called on state lawmakers Tuesday to leverage tax credits to combat Florida’s worsening affordable and workforce housing shortage, spotlighting a crisis that continues to squeeze low- and middle-income residents.
The recommendation comes in a new report, More States Are Using State-Level Tax Credits to Address Workforce and Affordable Housing Deficits, a follow-up to the group’s 2019 critique of diverted housing funds.
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“Despite Florida’s recent laudable efforts to provide more housing, the ability to find an affordable place to live is still problematic for many Floridians,” said Dominic M. Calabro, president and CEO of Florida TaxWatch. He pointed to a stark deficit of low-income rental options and a fading American dream of homeownership, driven by inflation, a 39% statewide property tax hike over three years, and soaring insurance costs. “This is a significant deficit,” Calabro added, noting that homeownership is slipping further out of reach for hardworking middle-income families.
The report praises recent legislative steps, like the 2023 Live Local Act, which incentivized affordable housing development, but argues the problem remains “enormous.” Florida ranks last in the Southeast—and second-worst among the 10 largest states, behind only California—with just 25 affordable and available rental units per 100 “extremely low-income” households.
Statewide, 2.4 million low-income households spend over 30% of their income on housing, while 1.3 million shell out more than 50%, a burden that fuels social and economic strain.
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Jeff Kottkamp, Florida TaxWatch’s executive vice president and general counsel, urged lawmakers to adopt state-level tax credits to bridge the gap.
“Florida should consider a State Low-Income Housing Tax Credit, a corporate income tax credit for homebuilders to help build more single-family homes affordable to middle-income families, and a credit for rehabilitating historic properties for affordable housing,” he said. Thirty states already pair such credits with the federal Low-Income Housing Tax Credit (LIHTC), reporting boosts to both housing stock and local economies.
The stakes are high. Lack of affordable housing harms children’s health and education, limits self-sufficiency for the elderly and disabled, and drives up costs tied to homelessness, the report warns. Conversely, investment in housing cuts those expenses while spurring construction jobs and workforce growth.
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Yet homeownership—a cornerstone of economic stability—has grown elusive. In 1980, most Floridians owned homes by age 30; by 2021, that milestone shifted to 42, squeezed by rising costs and a tax system that favors long-term owners over first-time buyers via the Save Our Homes cap.
Florida’s housing crunch has drawn national attention as its population booms, yet supply lags. The federal LIHTC has aided efforts, but advocates say state-level action is critical to meet demand. “The Legislature should be commended for their efforts to date, but the shortage of affordable and workforce housing units is still massive,” Kottkamp said.
As lawmakers gear up for the 2025 session, Florida TaxWatch’s push frames tax credits as a pragmatic fix—potentially easing the burden on millions while fueling economic activity. Whether the proposal gains traction remains to be seen, but with homeownership and rental affordability at a tipping point, the call to act is louder than ever.
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