Property Tax Reform: Is The End In Sight?
There may be significant progress toward agreement on Property Tax Reform. Today, the House issued a version that seems to have very good support (yes, even among the Democrats!).
The House proposal will be voted on this Monday; then over to the Senate to reconcile differences with its plan. The two keys changes recommended in the House version are:
--Guaranteed Save Our Homes Benefit – For non-school taxes, instead of doubling the homestead exemption, this approach would guarantee a minimum Save Our Homes exemption of at least 40% of the county’s median home value. This approach will target relief precisely toward those homesteaded property owners who bought homes in the last few years and new homestead property owners who need it most.
--Protection of a 5% Save Our Homes-like cap on non-homestead and commercial property - Capping assessment increases on all non-homestead and commercial properties at 5% will help restore fairness, equity and predictability to our property tax system by providing real protections against any outrageous tax increases in the future. It would provide much the same taxpayer protections for renters, affordable housing, second-home owners and small business owners that primary homeowners currently enjoy.
Here is a link to a summary of all the elements of the House plan:
http://blogs.tampabay.com/buzz/files/refined_property_tax_plan.pdf
What do you think? Would you vote for this proposal if it is offered as a Constitutional Amendment on January 29, 2008? Why or why not?
UPDATE: The House has just approved (10/29--7:00PM) the Senate version of Tax Reform. See a further explanation in the thread below.
posted by Blog Master @ 7:02 PM
56 Comments:
Too complicated. How they going to explain this on a ballot? People will be in the voting booth for hours trying to read and understand.
Better than increasing our taxes. It would be even better if the school taxes were exempted for all over age 70.
Don
(OTOW)
Don when you were raising kids did the folks over 70 have to pay taxes?
Don't go there.
Maybe workers under 30 shouldn't have to pay Social Security taxes since seniors and baby boomers will likely deplete the account before young adults ever see a dime!
Screw complex tax laws! Go back to the first idea--eliminate all property taxes and replace them with an increase in sales tax of 2.5%. I'll vote for that.
I’d bet you that section about the Legislature controlling the taxing authority of local government doesn’t make it. Too many Democrats want to let local government tax and spend.
You want a simple solution? How about a Constitutional Amendment that caps property taxes at 1.25% of taxable value?
Check out how it might benefit you and how to sign the petition:
http://cutpropertytaxesnow.com/
Florida Tax Watch, the government spending watchdog, says the House plan is better than the Senate plan because it better targets relief to those who need it most and starts to slow the shift of tax burden to non-homestead properties by placing a 5-percent cap on businesses and second homes.
Complicated or not, it is a good start.
10:56
The under 30s should be allowed to stay out of Social Security. They might be better off. They could still be allowed to participate in Medicare but only by paying a much higher premium than a Social Security member.
Don
(OTOW)
I wish I could.
The average savings in the Huse Plan for a Marion County taxpayer (with homestead) is $185 per year.
Smoke and mirrors folks. That's not drop like a rock savings. And to think, the House plan is better than the Senate version.
If your figure is correct, what a disappointment to taxpayers.
I'M FOR THE 1.25% PROPERTY TAX CAP PROPOSAL BY THE CUT TAXES NOW GROUP.
Am I understanding correctly that the school tax is excluded in applying the increases in the homestead exemption? If so, that's a bummer.
Did you know? Local governments receive the great majority of their total revenue from OTHER SOURCES like fees, licenses, bonding, etc.
% of Total Revenue from Property Taxes--
Government Entity (FY 2003-04 - most recent data available):
Counties 31%
Cities 18%
School Districts 38% (in 2004-2005)
Special Districts 20%
Interesting.
Several months ago I remember County Administrator General Howard saying something like we will get the money one way or another. Well, the county government has many ways other than our property taxes and they will use all 70% of them.
The House passed its revised property tax bill by an incredible vote of 108-2. This came after hours of debate, and without the sharp partisan differences that have marked past property tax debates.
The bill now goes over to the Senate for its consideration and further negotiations. Puts the Senate in quite a spot.
The house plan looks pretty good. However, if it were to become part of the constitution, local governments would increase every other fee and tax they can. That is why it is important to pass a total revenue cap only breakable by voter approval.
Crist and the Florida senate should get on board this train.
If anyone is interested, I obtained a comparison of how our current $25,000 Homestead Exemption compares with the 40% Exemption under the House of Representatives Plan.
2007 Median 40% of
Home Value Home Value
$141,155 $56,462 (Marion County)
$149,900 $58,960 (Alachua County)
$ 89,245 $35,698 (Levy County)
$167,268 $66,907 (Lake County)
Bottom line, under the House Plan, Marion County taxpayers get an added $31,462 in Homestead Exemption and $6,462 more than under the Senate Plan. The Homestead amount would change each year based on the county’s change in median home value.
I’d say the change in the Homestead Exemption recommended by the House is not even getting Marion County up to par with what inflation has done to $25,000. It is about $8,000 short.
A $25,000 Homestead Exemption in 1980, when it was authorized, would be worth about $64,000 today.
Hold your horses on the Homestead Exemption changes!! Things are not always exactly as they seem.
Further analysis of the House bill would indicate that the new (higher exemptions) will not apply to anyone who already has "Save Our Homes (SOH)" protection in excess of the higher exemption amounts.
The only advantage would be "portability" (i.e., transfering any accumulated SOH when buying another home in Florida).
So, $25,000 would remain the standard Homestead Exemption for most everyone, except certain senior citizens.
More on this tomorrow.
IT'S WAY TOO COMPLICATED FOR ME.
Simple solution, do ALL the house of rep. ideas EXCEPT the 'special' save our homes exemption. Instead of that one just increase the homestead exemption to $60,000 for all homestead property owners and then index it to annual change in inflation.
Screw the businesses and the snowbirds who don't live here all the time. They should not get any special property tax breaks. Take that money and further reduce the taxes of resident home owners.
Great for the housing industry. Should help people who want to move but don't want to have to pay higher assessments on another home.
The polling organization, Quinnipiac University, found 59 percent of voters support three major portions of plans that are being debated in the Legislature: doubling the homestead exemption, portability and first-time home-buyer breaks.
Doubling the homestead is most popular (74 percent), though the plan really doesn't do that because schools are exempt and therefore cuts about 40 percent off the average savings. Portability: 57 percent. Tax breaks to first-time homebuyers: 46 percent.
The polling organization didn't have time to survey the House plan, which uses a median-county value approach to increasing homestead exemptions and caps commercial property taxable value increases.
Voters also said that they approve of the way Charlie Crist is handling property-tax cuts by just a 45-39 percent margin.
Anonymous said...
I'M FOR THE 1.25% PROPERTY TAX CAP PROPOSAL BY THE CUT TAXES NOW GROUP. (8:41 PM, October 21, 2007)
You better check this one out on your own property before buying in to the proposal by the Cut Taxes group. It would increase my taxes by $650.
3 blog posts in four days?
Sounds like it's time for a new subject.
Rubio has the Senate and old Crist by the short hairs!!!!
Rubio for Governor 2010
The Senate has developed revisions to the House plan. Here are the highlights of the Senate plan, now at $12.4-billion savings over five years:
-- Save Our Homes portability, up to $500,000.
-- Doubling the $25,000 homestead exemption. Schools are exempt so the break is more like $15,000, according to some estimates.
-- Tangible personal property break at $25,000.
-- 10 percent assessment cap for nonhomestead property, with school taxes exempt.
Rubio is the only one doing anything important for taxpayers about our property taxes. The rest are giving it lip service.
I believe the feelings of many voters about the Legislature and the property tax issue is shown in this comment from an Orlando blog:
It is all smoke and mirrors! These people are so incompetent - little sheep that do the Parties' bidding. They couldn't care less about the average working person/the taxpayer.
After they fixed the property tax crisis the first time - property taxes went up.
After they fixed the property insurance crisis - property insurance went up.
After they fixed the PIP crisis - auto insurance went up.
Vote anti-incumbent - whoever replaces them couldn't do worse.
And for this they are getting a 3% raise and are paid over $30,000 for their 60 days of "work" plus additional moneys for each day they are in Tallahassee plus per diem! And these part-time workers earn better than full-time benefits (free health insurance for them and their families, free dental, and better than state employee retirement).
Kick these bums out since they can't get the job done!!!
P.S., Blogmaster—Technically, the Senate Plan you summarized is not a revision of the House Plan. Anyway, doubt anyone knows the difference.
With too many idiots working on the tax problem, it will never get solved. Here is an example of a comment from one of our esteemed and "intelligent" State Senators about the portability provision in the House and Senate plans:
{Miami Democratic Sen. Larcenia Bullard just said she initially didn't understand portability and that "I thought it was some place to go to the bathroom."}
UNBELIEVABLE!!!
Tax Reform to Go on Ballot:
The Florida House just voted to concur with the Senate's property tax bill, putting aside major disagreement with the scope of the plan and the way it was presented. The bill passed 97-18 and putting it on the ballot on January 29 was 112-3.
As previously posted, the Senate plan includes doubling the homestead exemption, Save Our Homes portability and a 10 percent cap for non-homestead property assessments.
There is a very good chance the portability component just passed will be held unconstitutional because the Senate removed the first time homebuyer component from the House version. With the inclusion of the first time homebuyer benefit, the equal protection legal argument to challenge portability was difficult - now it’s easy.
The Senate and House basically passed a bill, which if it passes on the ballot, will likely get overturned because they ELIMINATED THE PART THAT MADE IT CONSTITUTIONAL! Was that dumb or what?
Why exempt the school systems from any tax cuts? They should be treated just like the rest of government. Schools are full of waste and bloated payrolls. Cut them also.
The Legislature has passed a Constitutional Amendment that:
1. Guts public education by $2 billion.
2. Threatens to eliminate Save Our Homes, through a likely unconstitutional portability plan.
3. Provides no meaningful relief for businesses.
4. Provides no relief for low-income senior citizens.
5. Provides no protection for fiscally strained municipalities.
This is what our Legislature -- Republicans and Democrats – are now on record as supporting.
Instead of dropping taxes like a rock, what may be dropping like a rock is the reelection chances of many incumbent lawmakers!
Are you nuts!
Vote no to a tax reduction. Small or not, I'll take it. If they would keep the damn schools from being excluded, we could have an even larger cut.
What property tax reform? The $20 per month tax relief will be mostly offset by the recently announced surcharge that will be added to insurance premiums. Ain’t the Governor and Legislature really helping us with their give and take shell game!
Gun nutt says...
Vote no said that the property tax cut, "Provides no protection for fiscally strained municipalities."
I think the only thing that will be strained by the cuts will be our eardrums from all the crying of the local offials. They are afraid that their gravey train is going to be derailed. Well I hope it is.
Remember real estate prices have gone up a lot lately. Since property taxes are based on the prices of property, the taxes have also gone up a lot lately. It's time to bring them back to Earth.
Vote for any and all tax cuts!
A very good friend of mine, who owns both homestead and non-homestead property, told me his concerns about the recently passed Tax Reform Plan. Some of his concerns were similar to those in this article link:
http://www.sun-sentinel.com/news/local/florida/sfl-flfproptax1031nboct31,0,1841072.story
I believe the one thing that could kill passage of the Tax Reform Amendment in January 2008 will be a "fear campaign" emphasizing that voting for passage of this Amendment could open up homestead property owners to a loss of ALL current accumulated SOH benefits via a legal challenge to the Amendment. I will not vote for the Amendment, if a good case can be made that it will not withstand a legal challenge. I’m sure not willing to play Russian Roulette with my current SOH protection to help our Governor try to win some personal, political popularity poll that may well be short lived!
Our only hope for meaningful and realistic property taxpayer relief may be in the form of a Citizens’ Initiative. Speaker of the House Marco Rubio is considering this--realizing it could take some time to implement. However, doing what's right for citizens is more important to me than doing something on the basis of a political poll, which seems to be the current modus operandi of Governor Crist and other politicians (especially those in our State Senate).
What kind of legal advice do our legislators get? Isn't Crist a lawyer? How could they pass something that has a determined possibility of being unconstitutional?
If the Save Our Homes exemption is going to be at risk, I'll also vote against the tax reduction package. It's not that a big of a financial break unless you have been in your home many years and plan to move...which I don't.
If you want to get homeowners more interested in the spending of coutny gov't. than they are, just take away all that save our homes build up they have and raise their taxes to cover it. Watch them come out of the woodwork and be all over the local gov't. spenders.
Stan-
I'm with you. However, the real solution is one that no politician, including Rubio, is willing to push. We need to seriously consider an income tax to replace some or all of the current property tax burden. Think that will ever happen?
A good solution to property tax reform.
Former state Senate President John McKay, a member of the Tax Reform Commission, is proposing a tax plan that would reduce homeowners' property taxes up to 45 percent at the expense of business interests that have been exempted from sales tax for decades. The plan would eliminate property taxes for education, except those that have been pledged for bonded capital projects.
He has filed a proposed constitutional amendment with the Commission that would direct the Legislature to review all items and services that are not being taxed in order to repeal $15 billion worth of sales-tax exemptions on services and items like lawn care service, professional sports skyboxes and cattle growth enhancers. The new revenues collected would replace a bulk of the property taxes collected for schools.
"Necessities of life" items like food, prescription drugs and health services would remain exempt from sales tax. But hundreds of other exemptions would be reviewed and could be subject to sales taxation. McKay estimates up to $100 billion in sales taxes goes uncollected each year
www.bradenton.com/local/story/188824.html
Not a bad idea.
iowa just started taxing pumpkins, saying they not a food. Florida to start taxing watermelons? maybe.
A good letter appearing in the Gainesville Sun.
"Rubio Understands Florida's Problems"
The unions hate him. The Democrats hate him. Government employees hate him. Taxpayers and working people love him.
Florida Speaker of the House Marco Rubio is the only elected official who understands the plight of the state.
Florida is headed for a massive recession. That means less money for everyone, including all the governments in the state. You can't have the real estate industry that represents one-third of the economy go in the tank and not feel it.
Rubio understands that 50 percent of all the homes in Florida do not have their assessments capped. These owners have been slammed with tax increases.
Rubio also understands that new buyers see this and are no longer coming to Florida. Our source of money is drying up and real estate prices are dropping like Gov. Crist's rock.
And with dropping prices come dropping assessments on all those homes that are not homesteaded. That means a whole lot less tax revenue for the local county and city. Who is going to make that up? Watch and see - this time next year massive millage increases on everyone.
Rubio is the only one who has thought this through. It is time for a citizens initiative to end property taxes forever. It is also time for Marco Rubio to run for governor.
Mark Generales,
Gainesville
Rubio could be a good governor in the future. However, right now Charlie Crist is the man. He’s getting things done. Governor Crist and Republicans with his moderate political style are working hard at making Democrats in the State of Florida obsolete and needless in our political system. Why would anyone want to vote for a Democrat when so many good things are being accomplished by Crist and Republicans like him?
Agree that Crist is popular—at the present. The Democrats are playing him like a fiddle to get what they want. They’ll continue to do that until a Democratic candidate for Governor is determined in 2009-10. Then Crist will get the knife in the back and will be left hanging. He may not even have enough Party support to win a Republican primary. Once the Democrats abandon him and his own Party dumps on him for his populist positions and turning on fellow Republicans, he will have to find gainful employment in some other field. How about as a male model or selling tanning beds?
Tanning bed salesman--that's a good one LOL!!!
I just read the "Critic from Belleview" post to Stan asking if he thinks we will ever solve the tax problem with his solution -- an income tax. Usually, I find some agreement with Critis, but let me answer for Stan:
Hell No!
Income taxes are what has driven people by the tens of thousands from up north to Florida. Newspapers love them, Democrats love them, and voters hate them.
Government expands in direct proportion to space and money, and if you think an income tax will solve the problems of financing government, you should look at how fast they filled up their new building department facility enxt to the library. Or watch them fill up the new courthouse. Four years ago, the Judges said they had plenty of room. Then they saw how easy it was to pass the facilities sales tax (one cent for two years) and they suddenly needed more space and $42 million.
The solution is not new taxes, and surely not an income tax. If you want to get a 90% voter turnout, try to change the constitution to get an income tax.
You ruined my day. I should have skipped the block another day. but I'd have been back sometime. --pwf
Critic From Belleview,
Sorry, I missed seeing your question.
I think PWF is basically on point about an income tax. However, if it was applied only to “earned income” (i.e., dividend and interest income not taxable) and designed to replace/offset some of the state sales tax and/or school tax, it might be easier to sell. In the current anti-tax environment it’s doubtful an income tax could get any legs.
I saw a poll that shows quite a bit of voter uncertainty about the property tax amendment. 31% of likely voters, including Republicans, Democrats and Independents, are certain to vote Yes on the amendment, 13% are certain to vote No. 56% are not certain.
This may be just what the Tax Reform Amendment needs to get the 60% vote it needs.
Mobile home owners who own the homes but rent the lots now pay the Florida Department of Motor Vehicles an annual registration fee, usually between $55 and $400 depending on the home's size. Then the county property appraiser's office sends them a tangible tax bill for any additions, like a storage shed, carport or porch. The average mobile homeowner will save $100 a year.
If voters approve the January amendment, these homeowners would no longer have to pay the taxes for tangible personal property assessed at up to $25,000.
Doubt they will have that much impact.
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