Posted on 07/09/2004 4:52:33 AM PDT by Jacquerie
Florida voters might unwittingly amend the state constitution to increase taxes on poor renters and force local governments to raise property tax rates. Most voters would be surprised at that result, but if a proposed amendment to double the homestead exemption gets on the ballot and wins majority support, that and worse will happen.
The problem begins with deceptive wording. A summary of the amendment change promises it ``provides property tax relief to Florida home owners by increasing the homestead exemption on property assessments by an additional $25,000.''
Your tax bill would be lower only if tax rates stayed the same - which they won't. The loss is so great that rates are sure to increase to cover at least part of the shortfall. This amendment misrepresents its primary promise.
Obviously, if a homeowner is allowed to exempt from taxes $50,000 in value instead of the current limit of $25,000, local governments will have less value to tax. In round numbers, a typical homeowner appears to save $500.
That translates into a revenue loss of about $68 million a year for the Hillsborough County general fund and about $42 million for county schools. Almost no one thinks these budgets contain anywhere close to that much fat.
Fifteen years ago, about 19,000 single-family homes were totally off the tax rolls in Hillsborough County because each was valued at less than the $25,000 exemption. Over the years, rising property values have reduced that untaxed number to 6,200 single-family homesteads as of this year, says Warren Weathers, Hillsborough County's chief deputy property appraiser. Were the exemption to double, 42,000 houses would drop off the rolls next year.
Owners of those homes won't care how high tax rates go. Those untaxed homesteads would still send children to school, need their streets swept, and expect police and fire protection. They would still want their properties protected through zoning laws. Why should they pay no property taxes?
The homestead exemption applies only to owner-occupied dwellings. Landlords get no break, so property taxes are passed on to renters. Business owners also enjoy no exemption.
Another property tax reform, which took effect in 1994, caps annual increases in taxable value of a homestead each year, regardless of the market value. Weathers says that constitutional limitation saves a typical homeowner $700 a year in Hillsborough County. Some 258,000 county properties are now protected by the cap.
Doubling the exemption won't make streets cheaper to pave or schools less costly to operate. It will only pressure officials to increase tax rates, jack up fees or impose new taxes.
If we dump the Bullet Train and Class Size Ammendments, there would be less of a problem.
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