FAIR PROPERTY TAX FOR ALL, INC

The State of Florida has proposed an Amendment (“Amendment One”) to Florida’s constitution for voting on January 29, 2008.  This amendment is currently being supported by Governor Charlie Crist who has named the campaign “Yes on One.”  If approved, this amendment would:

• Increase the homestead exemption

• Permit the portability of Save Our Homes

• Provide a $25K exemption from the tangible personal property tax

• Place a 10% per year assessment limitation on non-homestead properties.

“Amendment One” creates confusion with other tax lowering initiatives, mostly with the 1.35% property tax cap initiative for which signatures are currently being collected. AMENDMENT ONE HAS NOTHING TO DO WITH THE 1.35% PROPERTY TAX CAP PETITION. Some advertising seeks to tie “Amendment One” to unrelated initiatives causing confusion amongst voters and taxpayers.

INCREASE IN HOMESTEAD EXEMPTION

Approving this measure will give taxpayers the illusion of having gone as far as they can or accomplishing all they can. When in reality the current amendment on the ballot gives taxpayers minimal property tax relief.

“Amendment One” Increases the homestead exemption by exempting the assessed value between $50,000.00 and $75,000.00. This exemption does not apply to the portion of property taxes paid for schools.

This is confusing because in reality the current exemption for most Floridians is $25,000.00. 

It allows homestead exemptions to be repealed if a future constitutional amendment provides for assessment of homesteads "at less than just value" rather than as currently provided "at a specific percentage of just value" rather than as currently provided "at a specific percentage" of just value.  This is most concerning in light of the fact that it has already been established by the Florida Supreme Court that the homestead exemption is necessary to enact Save Our Homes Protection.

If Amendment One were to pass, not only would it severely limit future tax reform amendments, but it could also very well lead the abolishment of Save Our Homes.

PORTABILITY

Portability potentially creates a twofold problem:  first it gives current property owners an additional advantage over first time buyers; this can possibly cause a backlash and a legal challenge to the current Save-Our-Homes potentially undoing both Save-Our-Homes and Portability.

Furthermore, portability exacerbates an unfair tax structure and punishes young families making an already unfair tax system even worse.  It shifts the burden to non-homestead and first-time homebuyers (including families relocating from other states) since for them portability simply does not exist.  Small businesses also will suffer the undue burden since this amendment gives preferential treatment to existing homesteads ONLY.  Additionally, allowing homeowners to take their Save Our Homes savings with them could be unconstitutional since it would add to the tax burden on out-of-state buyers.

Portability would violate the Equal Protections Act in the 14^th Amendment of the US Constitution by creating a permanent class of unequal under the law.

Portability modifies the Save Our Homes law and this could mean the loss of Save Our Homes benefits for homestead homeowners forever.  These issues could provide the legal argument to abolish SOH.

It is interesting to note that Save Our Homes just barely made it past the Florida Supreme Court but since it would not be in effect at the sale of the property, it was approved.

Portability creates permanent entitlements that have no end for certain homeowners and is therefore unconstitutional.

Portability would be allowed within one year and not more than two years after relinquishing the previous homestead.  This is confusing as to the dates of eligibility of transfer.

10% PER YEAR LIMITATION

10% cap on non-Homestead property leaves a lot of room for local governments to continue frivolously wasting taxpayer dollars and placing undo pressure on rental and commercial property owners and by extension on to their tenants. Why does this provision take effect in 2009 or 2010 and not 2008 or 2009 like homestead property? This again does not affect the portion of taxes paid for schools.

The 10% for levies other than schools plus 7% for schools equal a 17% tax increase assuming the school levies make up 35% of the property tax bill as it occurs in most areas.  The 10% will sunset in 10 years however school taxes are exempted under the cap therefore will result in a failure of what the 10% cap is attempting to solve.

TAX BURDEN FOR SCHOOLS ONTO LOCAL HOMEOWNERS

The legislature has direct control over almost half of your property tax bill that is the portion that goes to schools.  The state decides how much property tax local school boards must levy through what is known as “required local effort” in order to fund education.

The state government, that has a constitutional duty to fund education, has instead pushed over $4 Billion in educational costs onto local homeowners since 2001 while its own contribution to education has declined.  Today homeowners provide nearly half of all the educational funding through local property taxes.  This last year, the legislature voted to raise property taxes for schools by 7%.  The year before last it was 17%. 

CONCLUSION

For these and other reasons it would not be advantageous for voters to approve the constitutional amendment that appears on the January 29th ballot.