TALLAHASSEE, Fla. – Nov. 26, 20007 – Continuing to bash a property-tax plan he reluctantly voted for, House Speaker Marco Rubio is now urging supporters to back a citizens’ petition to cap the total amount of taxes paid by every property owner.

The proposed constitutional amendment would limit the amount of taxes a property owner pays to 1.35 percent of the value of his property. So a home or business with a taxable value of $100,000 would pay a total of $1,350 to all area local governments and school districts.

The backers of the amendment, Tampa-based Cut Property Taxes Now, made its political presence known in September when it paid for 1,100 cable TV advertisements against Weston Mayor Eric Hersh because of his lawsuit that led a judge to strike the Legislature’s last property-tax plan from the Jan. 29 ballot.

In response to the judge’s ruling, the Legislature came up with a replacement to ask voters to boost homestead exemptions and allow homeowners “portability” to transport homestead exemptions to another residence.

But Rubio reiterated in an e-mail to supporters that the legislative plan “falls short” and that “only a citizen-led petition drive will ever result in meaningful tax reform and relief.”

To that end, Rubio said that Cut Property Taxes Now offers the best solution because people could understand the measure and it significantly cuts property taxes. Homeowners now benefit from the Save Our Homes cap that limits increases in the taxable value of their homes to 3 percent a year. But owners of commercial property and second homes don’t have a cap and the cap doesn’t limit taxes when a homeowner moves to a new house.

“This plan is simple, it applies to all properties, it keeps Save Our Homes and it cuts almost $8 billion in property taxes,” the West Miami legislator wrote.

Those who live in high-value areas with low tax rates might see fewer savings under the plan because they’re already paying a relatively lower percentage of tax than those in less wealthy areas. Legislative analysts estimate the statewide average tax percentage this year is about 1.65 percent, compared to the 1.35 percent that this petition seeks.

Rubio technically won’t be campaigning against the Legislature’s plan, which Gov. Charlie Crist is actively backing.

Crist this week met with business groups to shore up support for a campaign that could raise and spend upward of $10 million. The governor-backed group, Yes on One, is also mounting an advertising and campaign blitz and the governor’s deputy chief of staff, Arlene DiBenigno, is taking a leave to run the campaign.

The citizens’ petition isn’t the only one that Rubio will be involved with, though. He has lent the House staff to help Carlos Lacasa prepare a constitutional amendment for review by the Taxation and Budget Reform Commission. Lacasa, a Miami lawyer, is Rubio’s appointment to the tax panel, which has the power to put constitutional amendments directly on the November 2008 ballot without going through the cumbersome petition signature drive that Cut Property Taxes Now must follow.

Lacasa is working on a plan to cap property taxes for commercial property and give homeowners a super-sized homestead exemption that far exceeds the current $25,000 exemption.

Rubio will likely raise money and support any measure that would bring big tax cuts, said his top legislative lieutenant, Rep. David Rivera of Miami.

“He wants to cut property taxes, and a lot of people do, and he wants to help them,” Rivera said.

Rubio has a distant hometown connection to Cut Property Taxes Now: Ira Paul, a Hialeah teacher who placed the ads against Mayor Hersh. On the committee’s website, www.cutpropertytaxesnow.com, the backers also take Crist to task for failing to make good on his pledge to have taxes “drop like a rock.”

The committee anticipates the biggest challenge to the measure will come from people who fear cutting money from schools. However, in its frequently asked questions section, the supporters say school money shouldn’t be cut too badly because the Legislature will be able to decide what portion of the property-tax pie schools could receive.

The website also notes that local governments have dramatically increased spending since 2000, and that this plan doesn’t affect Save Our Homes, the tax plan that limits tax-assessment increases to a maximum 3 percent a year.

The biggest enemy to the proposal right now is time: Backers need 611,000 voter signatures by Feb. 1 to get the measure on the November 2008 ballot.

Rubio urged people to get friends, family and church members to go on the website and download and sign the petition. But, he said in October, it is unlikely any citizen petition drive will be completed before the 2010 ballot.

Even if the matter winds up on the ballot, it faces another test: It must win approval from 60 percent of the voters.

Copyright © 2007 The Miami Herald, Marc Caputo. Distributed by McClatchy-Tribune Information Services.

November 15, 2007

FL Today Poll: Close call on Fla. tax relief passage

Mason-Dixon survey shows 56% support measure; 60% needed –11/15/07

BY JIM ASH
FLORIDA TODAY CAPITAL BUREAU

TALLAHASSEE – Most voters support a $12 billion property tax relief proposal that will appear on the Jan. 29 ballot, but not enough to enshrine it in the state constitution.

A Mason-Dixon poll released today shows 56 percent of likely voters would support the measure, just 4 points shy of the required 60 percent margin required by law.

The survey showed 22 percent of voters are opposed and 22 percent undecided.

“If it were a simple majority vote, I think it would pass today,” said pollster Brad Coker. “Getting it over 60 is going to take some work.”

Mason-Dixon surveyed 700 likely voters from Nov. 12-14. With the margin of error at 3.8 percent, the measure still falls just shy of the mark.

Gov. Charlie Crist, the measure’s cheerleader in chief, isn’t worried.

"That sounds like pretty good numbers to me,” Crist said. “We only have to gain 4 and we've got a lot of undecideds, so I'm very encouraged about that."

The measure sells itself, Crist insisted.

"Look, the people get it,” he said. “I mean, if you just tell them that if they vote yes, their property taxes go down, if they vote no they stay up. It's kind of a simple thing to explain.”

The numbers hold some solace for supporters, Coker said. The key is in the party breakdown.

Democrats, traditionally less enthusiastic tax cutters than Republicans, support the measure by a margin of 53 to 23.

The measure’s success or failure will rest on how strongly Democratic voters respond to warnings about cuts to education and local services, Coker said.

“Are they going to vote their political conscious, or are they going to vote their pocket book?” Coker said. “Democratic voters typically respond to these kinds of pleas, but they’re frustrated too, that their taxes keep going up.”

Turnout will also be crucial, Coker said.

If New York Sen. Hillary Clinton’s nomination seems a foregone conclusion, that could keep opponents home on election day, Coker said.

Republicans flocked to the polls in higher number than Democrats in the gubernatorial primary in 2006. Republican turnout was 986,000 to the Democrats’ 858,000.

The proposal would double the $25,000 homestead exemption for homes worth more than $50,000, allow homeowners to take up to $500,000 in “Save Our Homes” assessment cap savings with them when they move and offer a Save Our Homes-like 10 percent cap for commercial and non-residential property.

It would also give a $25,000 exemption for the taxes businesses pay on equipment and other tangible personal property.

Rebecca O’Hara, legislative director for the Florida League of Cities, a chief opponent, said the results are encouraging.

“What it says to me is that people are going to be looking at this a lot more carefully than that you might otherwise have suspected,” she said. “I think the public is picking up on the idea that this is tax relief and not reform. They might be questioning whether the trade off is worth it.”

Supporters, backed by the Florida Association of Realtors, have a war chest with slightly more than $1 million. O’Hara said it’s too early to say what kind of opposition campaign the league will wage.

The league unanimously passed a resolution last week to oppose the measure at its annual legislative conference in Orlando, O’Hara said.

“That’s very telling,” she said.

FAR policy representative Trey Price declined to respond to the poll until he had a chance to study the numbers.

November 14, 2007

Experts agree: Florida is feeling the tax squeeze

Florida Today Panel answers reform queries – 11/14/07

BY JOHN McCARTHY
FLORIDA TODAY

MELBOURNE - More than 200 people crowded into FLORIDA TODAY's community room Tuesday night to hear three experts discuss a hot topic: property tax reform.

The panel, which took questions from the audience, included:

• Sen. Mike Haridopolos, R-Indialantic, a leader in the Legislature's tax reform movement.
• Dr. Sean Snaith, an economist and director of the Institute for Economic Competitiveness at the University of Central Florida in Orlando.
• Brevard County Commissioner Truman Scarborough, the board's chairman in 2008.

Haridopolos hammered home a consistent theme throughout the event, organized by the newspaper: Floridians pay too much in taxes and should get a break.

"We know taxpayers can't afford to be squeezed anymore," he said.

Snaith agreed that for many people, property tax bills are very high. But he said that was because of the state's two-tiered system that gives tax breaks to longtime homeowners. He suggested perhaps it is time to rethink the ways the state and local governments raise revenue rather than trying to force across-the-board tax cuts.

"Trying to navigate a trillion dollar economy on the cheap might not be the best idea in the long run," Snaith said.

Scarborough pointed out that some studies have shown that Florida already is the third-lowest state in the country for taxes, when all taxes are tallied up. And he pointed out that much local government spending is for voter-approved or state-mandated items.

"All aspects of our local budgets are governed by the state," Scarborough said.

There are four main components to the Legislature's new plan:

1. Doubling the homestead exemption to $50,000 for all homes assessed at more than $75,000.
2. Making Save Our Homes tax savings portable.
3. Eliminating taxes on the first $25,000 of equipment for business owners.
4. Capping annual increases in the assessed value of nonhomestead properties to 10 percent.

The proposal needs to be approved by 60 percent of voters to take effect. The vote will be held on Jan. 29 in conjunction with presidential primaries.

Haridopolos told the crowd the matter is their hands now: "You have every right to have the final say."
Contact McCarthy at 752-5018 or jmccarthy@floridatoday.com.

The latest version of property tax reform: How it works

TALLAHASSEE, Fla. – Nov. 1, 2007 – The Florida Legislature, caught in a game of “chicken,” approved a measure that will appear before voters on the Jan. 29, 2008, ballot. With time working against them, lawmakers agreed on a measure that scaled back earlier initiatives, and even current reforms pushed by the House.

What the current amendment includes:

Homestead exemption

The homestead exemption increases. The current $25,000 homestead exemption remains; but a second $25,000 exemption is added for home values between $50,000 and $75,000. The second $25,000 exemption does not apply to school taxes, however, which translates into a lower-than-expected savings of about $240 per homesteaded owner. The portion of a home valued between $25,000 and $50,000 will still be taxed at all levels. FAR fought to include this taxable portion in order to maintain fairness for smaller cities and counties with lower median home values.

Portability – Moving up

Property tax savings portability (money saved over time on property taxes because of yearly increase limits through Florida’s Save Our Homes amendment) applies to homesteaders (homeowners with a homestead exemption) moving anywhere within Florida. Up to $500,000 of accumulated savings, applied to taxable value, may be transferred when one home is sold and another is purchased, with the transfer applying to all taxes, including the school portion. Homeowners have two years after they sell a home to buy a new one and transfer the savings.

If buying a more expensive home, a homesteader calculates savings by subtracting the assessed value (taxable value) from the just value (market value). The amount (savings over time) is then subtracted from the just value on the new home purchased. In most cases, the $50,000 homestead exemption will also be subtracted.

Example: Susie currently owns a home and has lived there for a long time. The house’s just value is $500,000, but because of Save Our Homes, the assessed value is only $200,000. Susie buys a new house for $700,000. The following year, she’ll pay taxes on only $400,000, however, because she’s “porting” $300,000 in value to her new home. After factoring in the new homestead exemption of $50,000, her total assessed value would be $350,000.

If buying a less-expensive home, the calculation changes and is based on the percentage of tax savings rather than a dollar amount. If the assessed value on the original home was 50 percent of the just value, for example, the homesteader would transfer that percentage to the new home, or have a new assessed value that is 50 percent of the new home’s just value. The percentage system was created to keep homesteaders from effectively eliminating their property taxes altogether by moving from a high-cost area of Florida to a low-cost area – a change that could severely hurt smaller rural economies.

Example: Susie currently owns a home and has lived there for a long time. The house’s just value is $500,000, but because of Save Our Homes, the assessed value is only $200,000. Susie buys a new town home for $300,000. She’ll pay taxes only on $120,000 because when buying down in value, she’ll keep the same ratio (40 percent) of assessed value to just value that she enjoyed in her old home. After factoring in the new homestead exemption of $50,000, her total assessed value would be $70,000.

Also, portability is retroactive to Jan. 1, 2007 – so everyone who bought this year and moved from an established homestead will be able to “port” their savings for next year. Since yearly tax values are based on ownership as of Jan. 1 each year, portability would not affect this year’s tax bills, which most homeowners have already received; but the savings will be applicable to next year’s tax bill.

Non-homesteaded property tax cap

A win for FAR and an important piece of the amendment is a 10 percent annual assessment cap on non-homestead property. Similar to Save Our Homes, this cap limits the assessed increases of commercial, rental and second home property taxes to a maximum amount of 10 percent per year starting in 2009, protecting against high spikes in taxes from year-to-year.

While property values will not rise 10 percent every year, FAR believes the cap offers some relief and protection to properties in high-value markets and waterfronts from unpredictable tax increases. The Constitution mandates a tax reassessment to just value upon transfer for non-homestead residential properties of nine units or less, but allows the Florida Legislature to determine how reassessment will occur for commercial and higher-unit residential properties. However, implementing legislation passed during the Special Session provides for reassessment of these properties upon a change in ownership or use.

Tangible personal property exemption

Under the amendment, the Tangible Personal Property (TPP) exemption for businesses is $25,000. The Legislature estimates that this tax – paid to local governments on items such as shelving, desks, computers, and other office equipment – will exempt about 1 million of Florida’s 1.2 million businesses that currently pay it. The amendment also drops the requirement to file for the TPP tax.

Work not done

While the proposed amendment will save property owners as much as $12 billion (depending on the portability amount used), FAR will work for greater relief measures. The association also has serious concerns about a challenge to the constitutionality of portability.

Earlier versions of property tax reform included provisions to help first-time homebuyers, a move missing in the current version. With that protection gone, FAR considers it possible that it will be challenged under the U.S. Constitution along with the entire Save Our Homes property tax system. If that happens, it could bring everyone back to the table yet again.

© 2007 FLORIDA ASSOCIATION OF REALTORS®
 

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November 11, 2007 •• 1311 words •• ID: brv26007205
By JOHN McCARTHYFLORIDA TODAY Voters have less than three months to decide whether to approve the biggest change to the property tax system in 15 years. They face a four-part ballot proposal in January that promises tax breaks for homeowners, businesses and people who own second homes in Florida. It would: --- Make the savings from the "Save Our Homes" tax cap portable. The new proposal would allow homestead owners to apply up to $500,000 of the sheltered

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November 10, 2007 •• 263 words •• ID: brv26009674
JIM ASH Florida Today TALLAHASSEE -- The Florida League of Cities, wrapping up an annual legislative conference in Orlando, decided Friday to fight a $12 billion property tax relief package that lawmakers placed on the Jan. 29 ballot. "It really fails to deal with the disparities and the inequities in our current tax system," said the league's legislative director, John Thomas. "It further exacerbates an unfair system."

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October 30, 2007 •• 437 words •• ID: brv25520000
By JIM ASHFLORIDA TODAY TALLAHASSEE -- A bitterly divided Legislature voted Monday to put a $12 billion property tax relief package before voters Jan. 29. The stripped-down proposal calls for doubling the $25,000 homestead exemption for resident homeowners whose houses are worth more than $50,000, a move estimated to save the average homeowner about $240. Homesteaders would be able to take up to $500,000 in Save Our Homes assessment protections with them when they move.