Property tax consultants are in their glory these days. Instead of causing conversation to grind to a halt, property taxes are suddenly a hot topic at every luncheon, networking meeting and cocktail party. So, in the spirit of gathering our rosebuds while we may, what follows is the latest scuttlebutt on what may be offered in terms of property tax reform at the about-to-be-convened special session of the Florida legislature.
Those in the know are already aware that the special session of June 12-23 has been scheduled for the purpose of resolving the impasse between the State House and Senate about what to do to cure inequities in Florida’s property tax system.
At the start of the regular legislative session, Florida House Speaker Marco Rubio (R-West Miami) unveiled a plan intended to eliminate all property taxes on homestead residences. This was to be accomplished by raising sales tax by as much as 2.5 cents to 8.5 cents on the dollar.
The Florida Senate and Governor Charlie Crist opposed the sales-tax increase. Since no alternative plan was approved by both House and Senate, the 11-day special session will be the legislature’s last chance this year to resolve the property tax conundrum.
In the event no consensus comes out of the special session, Florida’s regular 20-year constitutional revision commission is expected to be called upon to address the property tax puzzle. Indeed, since many of the property tax bills filed during the regular legislative session have constitutional implications, the revision commission will have a multiplicity of property tax issues to discuss in any event.
Watch for the Senate’s first female president--and one of our favorite role models--Senator Gwen Margolis (D-N. Dade) to play a leadership role in the constitutional revision commission’s discussion of property tax reform. Sen. Margolis is a former chair of the Miami-Dade County Commission and the Miami-Dade County Value Adjustment Board, and is a property tax maven of the first order.
To get back to the legislature’s special session, it is apparent that Speaker Rubio will be prepared to abandon the trade-off of sales taxes for complete exemption for homesteads. Rubio is floating a new plan to cut property taxes by dramatically increasing the state's homestead exemption and giving a break to all other property owners.
Under Rubio’s revised plan, Florida homeowners would no longer have to pay property taxes on as much as 80% of the first $300,000 in value of their primary—or homestead—residence. The concept of linking property-tax cuts to a percentage of property values appears to be one which will garner philosophical and economic support in both the House and Senate. This cross-chamber, cross-party popularity distinguishes the increase in homestead benefit from the sales tax increase idea, which is traditionally regarded as regressive, having a disproportionate impact on wage earners, since a larger percentage of their disposable income would be consumed by a 40% increase in the level of sales taxes.
Watch this space for discussion of more Florida property tax news as it develops.
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Daniel A. Weiss has over 26 years experience as a Florida property tax attorney. Daniel Weiss was named in the 2007 Annual Edition of the South Florida Legal Guide as one of the top lawyers in the practice area of Real Estate - Land Use, Zoning & Environmental.
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What happens under the new FL property tax law to a homestead owner's property taxes on property he purchased in 2006. The taxes in 2006 were low with the prior owners' 10 years of save our home. Will the new owner be taxed at appraised value?
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