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Simpler Tax Overhaul Proposed

COLIN HACKLEY / Tampa Tribune

House Speaker Marco Rubio, R-Coral Gables, talks about the latest version of the property tax reform bill during a news conference Wednesday at the Capitol in Tallahassee.

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By JEROME R. STOCKFISCH, The Tampa Tribune

Published: October 11, 2007

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TALLAHASSEE - They pitched the total elimination of the Florida property tax system as we know it. They tried to clamp down on local government spending. They offered a 'super' homestead exemption that could have slashed tax bills.

Now, state lawmakers appear to be returning to a much more modest and simple property tax reform strategy advocated more than a year ago by then-gubernatorial candidate Charlie Crist: Double the homestead exemption and make 'Save Our Homes' benefits portable for those who move.

Those are the foundations of a property tax reform proposal pushed once again by Crist this week. On Wednesday, House Speaker Marco Rubio, R-West Miami, and Senate President Ken Pruitt, R-Port St. Lucie, indicated they were onboard. The legislative leaders extended the ongoing special session and said they expected to vote out a tax package by the middle of next week.

On the upside for the Florida Legislature: A constitutional amendment providing some measure of property tax relief will likely appear on the Jan. 29 primary ballot, after a judge threw out an earlier proposal for the 'super' exemption because of misleading language. Homeowners clamoring for a break will have something to vote on.

On the downside: The doubling of the homestead exemption provides an average tax break of just $214 to the average Florida homeowner. According to calculations by the governor's office, the average Floridian who moves to a new house and carries the existing 'Save Our Homes' valuation benefit with them would save $831.

The governor and others, however, have promised taxes would 'drop like a rock,' a political boast Floridians have heard before regarding their homeowners insurance premiums.

Rubio said the legislation was 'the most we can agree on' to get something on the Jan. 29 ballot. The deadline for ballot items is Oct. 31.

'There is going to be some disappointment about the part of the governor's plan that involves doubling the homestead exemption - not because anyone's against it, but because it doesn't do enough for taxpayers. It doesn't do enough for our economy,' Rubio said. 'It's not the governor's fault. I assure you that if it was up to him, it would be a lot bigger.'

In addition to doubling the homestead exemption, which lowers the taxable value of a home, and providing portability of the 'Save Our Homes' protection, Crist's plan would create a new exemption for first-time homebuyers equal to 25 percent of the market value of the property. It would also exempt the first $25,000 of the tangible personal property of businesses.

Crist's proposal would trim $6.3 billion from the collections of counties, cities, and other local taxing districts, with school districts exempt. That's a far cry from the $16 billion cut that was expected from the 'super' homestead exemption.

On Wednesday, Rubio said the House would seek to address a handful of additional issues. Those House add-ons would eliminate property taxes for low-income seniors; give added relief to mom-and-pop waterfront businesses and affordable housing; and offer breaks to homeowners and businesses making energy-efficient improvements.

A Senate report issued later in the day included the same issues, with the exception of the energy breaks.

The added provisions would yield another $3 billion in tax savings over four years, which would translate to additional savings for the groups targeted.

Rubio vowed to continue to push for lower property taxes.

'There's a lot more to do. This property tax issue is not going to disappear upon passage of this amendment,' he said. 'I would predict that ... it's only going to get bigger, and the calls for action are only going to get louder.'

Rubio said he still favors eliminating local property taxes altogether in exchange for a 2 1/2 cent increase in the state sales tax, something he proposed at the beginning of the year. He said he would support any citizen initiative that would advance such a system.

He acknowledged, however, that 'political realities' drove the tamer tax cut package.

Putting a constitutional amendment on the ballot requires a three-fifths majority of both chambers. Democrats are outnumbered 26-14 in the Senate and 77-42 in the House. That means the legislation could be derailed with just a few defections from House or Senate Republicans.

A spokesman for House Democrats said late Wednesday the members were still reviewing the legislation and would not offer a position statement until today.

Reporter Jerome R. Stockfisch can be reached at (850) 222-8382 or jstockfisch@tampatrib.com.

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