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Save Our Homes portability back in play for tax cuts

Author johnbsims3
Admin Male

#1 | Posted: 5 Oct 2007 04:16 
Save Our Homes portability back in play for tax cuts

A judge's recent ruling junking the Legislature's property-tax plan has turned out to be a blessing in disguise for lawmakers, because it is allowing them to dig for something better in their favorite place for tax plans: the recycling bin.
And their latest rediscovery -- portability -- seems to be their surest bet to get something before voters Jan. 29 because of Gov. Charlie Crist, who has recently moved from the sidelines on the issue to center stage.

In general terms, the idea of portability is simple and attractive: It allows people to keep their Save Our Homes tax cap and carry the tax-exemption savings from an old home to a new one. It has none of the baggage of the confusing and now-scrapped plan to expand homestead exemptions that legislators approved in June but which was invalidated last week by a judge as ``misleading.''

Portability is one of the many ideas that have re-emerged in the past week as legislative leaders, already meeting in a special session to cut $1.1 billion from the state budget, agreed to call yet another one for later this month to deal with property taxes.

Portability has bipartisan support, as does another popular plan: Making the first phase of the tax cuts -- which called for cities and counties to roll back tax rates and cap them -- deeper and tougher for local governments to escape.

About 40 percent of local governments have taken super-majority votes to avoid the cuts. Overall, though, local governments ended up cutting taxes deeper than legislative analysts had anticipated, according to figures from the Department of Revenue. The analysts estimated in June that about $2 billion in taxes would be cut. Local governments actually cut about $2.1 billion.

Other ideas include fixing the junked amendment or reviving House Speaker Marco Rubio's plan to eliminate all homestead property taxes and replace them with a sales-tax increase. Rubio's likely successor, Rep. Ray Sansom, said he'll put the sales-tax proposal ''in the forefront'' next year or when he becomes speaker.

Sen. Mike Haridopolos, a Melbourne Republican, is confident something can be done to reduce property taxes more.

''There's nothing new out there and we're just looking for the right tools in the toolbox to get us the necessary 30 votes in the Senate,'' Haridopolos said, adding ``everyone's talking about property taxes.''

The governor first pushed a portability plan on the campaign trail, but lawmakers rejected it in their spring session as impractical, because it gave Florida residents an unequal and potentially unconstitutional advantage over newcomers.

Unlike the regular session, when the governor was more cheerleader than negotiator on property taxes, Crist is now working behind closed doors to aggressively push portability and a plan to double the homestead exemption, which could cost local governments statewide about $2 billion a year.

Crist has worked the phones, met legislators individually and even button-holed lawmakers in the House chamber Thursday. The governor raised the issue in separate discussions with Democratic Rep. Jack Seiler of Wilton Manors, Republican Rep. David Simmons of Longwood and Democratic Senate leader Steve Geller of Cooper City.

''It's clear on this issue the governor is fully engaged,'' said Simmons, who met with Crist Monday and promised to get cost estimates to him about his plan.

Portability has become increasingly attractive for several reasons: It does well in public-opinion surveys and could muster the 60 percent threshold for a constitutional amendment, unlike the super exemptions; it could help revive some new-home sales, and both House and Senate leaders and members of both parties like it. Doubling the homestead exemption, however, is not popular with Democrats.

But there's no clear consensus on a plan and therefore lawmakers haven't agreed on a special session date for a property-tax fix. To get on the Jan. 29 ballot, any measure would have to be approved by a supermajority vote in each chamber by month's end.

Seiler and Simmons have also revived a new option that the governor is reviewing carefully. They suggest allowing homeowners to keep 50 percent -- or $250,000 -- of the first $500,000 in property value off the tax rolls. Simmons then wants to give homeowners another 60 percent off the next $500,000 in value and 70 percent off the next $500,000. Seiler, however, wants the exemption to be 40 percent off the second $500,000 and 30 percent off the next $500,000.

Regardless of the approach, the idea is simple, Seiler said. ``Whoever buys that property gets that exemption and it's not contingent on them being a Florida resident.

''For us to do this right, it has to be meaningful and it has to be simple,'' he added. ``I think they realize now that what they did back in June was really not meaningful and it wasn't simple and it was doomed.''

The junked amendment would have created a sliding scale for homestead exemptions that maxed out at $195,000 for a $500,000 home. Because a homeowner would have to choose between the super exemption or the popular Save Our Homes tax cap, the measure would have eventually phased out Save Our Homes. Those who wanted to keep Save Our Homes could have, but the benefit would have disappeared when the home was sold.

Leon County Circuit Judge Charles Frances threw that measure off the ballot last week, saying the wording was misleading. House Democratic leader Dan Gelber said the judge did Republican lawmakers a favor.

''They were crying crocodile tears,'' Gelber said. ``No one really liked what we had.''

But some Republicans defended their original plan and accused Gelber and other Democrats of being tax-and-spend naysayers. That was especially true with the budget.

Friday, both the House and Senate are expected to approve rival budget-cutting plans that range between $1.12 billion and $1.14 billion. Sen. Lisa Carlton, an Osprey Republican, said the differences between the two proposals are ``minor.''

The Senate calls for raising fees charged to grocery stores, fertilizer and commercial feed dealers, while the House has proposed changing state law to allow community colleges and state universities to raise tuition automatically each year based the rate of inflation.

House Republicans have proposed increasing spending on KidCare by $3.8 million, which is enough money for 5,000 more spots in the program that provides subsidized health insurance to children. The House also wants to cut by one-third the budget of the office that former Gov. Jeb Bush set up to help minority-owned vendors win state contracts after Bush eliminated affirmative-action policies in state purchasing.

The vote Friday will likely be split along partisan lines. Democrats on the House Policy and Budget Council voted against the budget-cutting plan on Thursday, citing, among other reasons, that the state is shifting more of the cost of public schools onto local property taxpayers.

Democrats also said the cuts would harm South Florida because they curtail payments to hospitals that provide care to immigrants and slice money from needed water-quality and alternative water supply projects.

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Save Our Homes portability back in play for tax cuts
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