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One property tax cut, but House slices it 2 ways

Author johnbsims3
Admin Male

#1 | Posted: 19 Apr 2007 06:49 
One property tax cut, but House slices it 2 ways

Months of debating over how best to lower property taxes came to this on Wednesday: The state House of Representatives couldn't settle on one plan, so it passed two.

The most popular, a proposal to slash taxes an average of 19 percent for all property owners in the state and require deep cuts in government spending, won unanimous approval. The other plan, to ask voters to wipe out taxes on homestead property in exchange for a hike in sales taxes, was the preferred choice of House Speaker Marco Rubio but mustered only a party-line vote of 78-40.

Rubio's plan is likely dead in the Senate, where leaders say they have unanimous support for their bipartisan plan to scale back all property taxes 7.6 percent without raising sales taxes to do it.

The two chambers will begin to hash out the differences next week, after the Senate votes out its own plan Friday.

Strengthening the Senate's negotiating hand is the House's schizophrenic approach to slashing taxes. One House bill -- the one that passed unanimously -- cuts taxes by $6.3 billion by rolling them back to 2001 levels. The other cuts them by $4.4 billion to 2003 levels.


''We are sort of navigating in the dark here,'' said Rep. Dan Gelber, the House Democratic leader from Miami Beach, after the votes. ``The House passed out two different versions of the same measure today. So, obviously, my colleagues haven't figured out what the right number is.''

He added that Democrats supported the larger rollback only on the condition that it be made more ''reasonable'' when the House negotiates with the Senate.

Rubio was at pains to explain why the House chose different dates, and he brushed off talk about the fact that one of his chamber's plans isn't bipartisan.


''We would like to have consensus,'' he said. ``We work toward consensus. It's ideal. But it is not our goal. Our goal is to make sure that the next time that the taxpayers of the state get a property-tax bill, it's one they can afford to pay.''

The House's 2003 rollback plan that Rubio endorses includes a proposed constitutional amendment to raise the six-cent sales tax by a penny, eliminate all property taxes that pay for schools, and give voters in each county the option of eliminating property taxes on primary homes while raising sales taxes by up to 1.5 cents.

The measures are the first step toward resolving the 60-day lawmaking session's priority. And while neither the Senate nor House plans will look the same by session's end May 4, the final plan will likely reflect the Senate's more targeted approach, which local governments fear far less than the House's plan.


This much is clear: Both chambers' plans cut business taxes paid on so-called ''tangible'' property such as computers, and there is universal agreement that legislators will roll taxes back to reduce Floridians' tax burden. The question is how much.

The Senate plan rolls back local governments' property-tax bases to the 2005-06 tax year, freezes the rate for a year, and then gradually adjusts them forward to account for population and wage growth.

The plan gives breaks to first-time home buyers and affordable-housing providers, and it allows people to transfer their existing tax savings to a new house.


As with the House's tax-swap measure, parts of the Senate plan require voter approval of a constitutional amendment, likely next year.

A leading House negotiator, Republican Rep. Ray Sansom of Destin, said a resolution should be relatively easy to achieve because the House and Senate agree on broad ''concepts,'' such as rollbacks, caps and transfer of homeowner tax savings.

Yet House leaders still proudly touted their tax-swap plan as bold and innovative, calling it the ''largest tax cut in the history of Florida.'' They promised that it would have wide-ranging benefit not just to homeowners, but to businesses and renters.

But Democrats argued that the proposal would have far-reaching negative consequences.

Renters and businesses would see little relief, they said, while homeowners would get the greatest benefit. They said low- and middle-income homeowners would shoulder the greatest share of the sales-tax increase while seeing the least benefit. And the elimination of the property tax on homes, Democrats said, would result in a more apathetic citizenry and a vulnerable state tax base that could jeopardize the state's bond rating.

Three Democrats, Reps. Luis Garcia and Ed Bullard, both of Miami, and Rep. Michael Scionti of Tampa, voted with Republicans on the tax swap. Two Republicans, Reps. Gayle Harrell of Stuart and Andy Gardiner of Orlando, voted against it, saying they were uncomfortable with raising taxes.

Garcia said he voted for the constitutional amendment ''for his district,'' as some of his closest friends had come to Tallahassee as part of the rally Tuesday.

''I feel that the Speaker's plan by no stretch of the imagination is a perfect plan,'' he said. ``It's better than nothing and a lot better than the Senate.''


The 2001 rollback plan was far easier for Democrats to support. They said it sends a message that they support tax cuts but warned that they want it revised to have a more reasonable impact on local government.

And there was this advantage: ''We knew they weren't sincere about their numbers. So this vote was easy for us,'' said Rep. Jack Seiler, a Wilton Manors Democrat. ``They even admitted their 2001 date was pulled out of the air, was arbitrary. We all agree there should be a rollback, so why not support this and move on?''

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One property tax cut, but House slices it 2 ways
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