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Ruling On Tax-Swap Amendment's Clarity Pending

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By CATHERINE DOLINSKI

The Tampa Tribune

Published: August 14, 2008

TALLAHASSEE - A circuit court judge could rule as early as this morning on whether a sweeping tax-swap proposal should appear statewide on November's ballot.
Amendment 5 would chop property tax bills by 25 percent to as much as 40 percent by eliminating the portion that pays for K-12 public schools. Lawmakers would be forced to use other revenue to replace the lost funding, calculated as the $8 billion raised through property taxes for schools this fiscal year, plus an allowance for growth based on past trends.

Although the property tax cut would be permanent, the guarantee of replacement revenue for schools would apply only in 2010-2011, the first year that the tax cut would take effect. After that, the Legislature would be free to fund education at whatever level it deems adequate.

That one-year caveat does not appear in the amendment summary that voters will see, prompting a coalition of plaintiffs to argue in Leon County Circuit Court on Wednesday that the question is misleading and should not appear on the ballot.

"It states there is an equal trade-off," said Barry Richard, attorney for a broad coalition of plaintiffs including local school boards and big businesses.

Attorney Mark Herron countered that nothing stated in the ballot summary language is incorrect.

The summary, he said, does not have to specify how long the "hold harmless" guarantee will last to be accurate.

"It does not hide the ball," said Herron, representing "Vote Yes On 5 For Property Tax Relief," a political action committee headed by the amendment's author, former Senate President John McKay.

Both sides said they will appeal Cooper's decision if they lose.

McKay proposed the amendment as a member of the state Taxation and Budget Reform Commission, which approved the plan for the ballot.

After the hearing, McKay said it would not have made sense to guarantee a replacement of revenue for schools beyond one year, based on a previous year's funding level.

"It's logical to assume that there's no significant change in student enrollment from one year to the next," he said. "But to go on, ad infinitum, would be hazardous. So what we wanted to do in the amendment was to give voters comfort that education funding would not be negatively affected."

A publicity campaign will educate voters about the nuances, he said.

The opposing counsels clashed over several other issues as well, including the need to explain to voters that although the amendment would automatically wipe out the schools portion of property tax, lawmakers would have to follow the orders in the amendment to replace the lost revenue, even for one year.

The amendment summary does not explain the pivotal role of the Legislature, prompting Richard to argue that individual lawmakers legally have the freedom to vote their conscience on any bill. That raises uncertainty about whether they will carry out the constitutional mandate, he said, which the summary does not explain.

Louis Hubener, a defense attorney who appeared on behalf of the state, said a ballot question summary is not the place to raise that issue.

"I don't think it would be appropriate to suggest in an amendment that directs the Legislature to do something and say, 'by the way, the Legislature may not do this even though they're being directed to do it,'" Hubener said.

Judge John C. Cooper seemed to appreciate that argument. However, throughout much of Wednesday's hearing he appeared skeptical about the amendment, peppering the attorneys with questions that essentially made many of Richard's arguments for him.

"I have a very high level of confidence, which I had walking in," Richard said afterward. "If anything, it's higher walking out."

Reporter Catherine Dolinski can be reached at (850) 222-8382 or cdolinski@tampatrib.com.

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