Plans to lower property taxes

Senate plan to save property owners $11B in taxes

By MICHAEL PELTIER
staff writer April 13, 2007

The Florida Senate unveiled its property tax relief package Thursday that retains Save Our Homes protections while providing, backers say, long-term predictability without unduly hindering local governments. "This is an across-the-board plan," said Sen. Mike Haridopolos, R-Indialantic and chairman of the Senate Finance and Taxation Committee. "We're trying to help every single Florida taxpayer, whether that is a first-time home buyer, a person who feels trapped in their home because they have a growing family or are an empty nester."

The proposal is the latest in a series of plans unveiled over the past several weeks as lawmakers try to address a statewide hue and cry over skyrocketing property tax rates. Fueled by a white-hot real estate market beginning in 2004, property taxes have soared across the Treasure Coast.
The Senate plan would save taxpayers about $11 billion over the next five years. The House plan provides $6.3 billion of property tax relief in the first year and up to $15.8 billion by the third year.
Several steps are needed for the Senate plan to become law. Provisions for increasing the homestead exemption and tangible property taxes, and for allowing portability of Save Our Home savings, would have to be added to the state constitution. Backers would need to convince three-fourths of their colleagues to agree to put the issue on the November ballot.
More plan details will become available today as Senate finance and taxation members discuss the proposal. A committee vote is expected Tuesday.
COMPARING THE PLANS
Other property tax rollback plans proposed this legislative session:
HOUSE
Roll-back tax rates immediately to 2000-2001 levels adjusted for inflation. Voters would be asked to approve a constitutional amendment that eliminates property taxes on homesteaded residences. Increasing the state sales tax by 2.5 cents would make up lost revenue.
DEMOCRAT
Allow homeowners to carry up to $250,000 of Save Our Homes benefit to a more expensive home. Measure also would relax Save Our Homes cap by allowing local property appraisers to raise assessed value of a home more than the 3 percent now allowed under the 1992 constitutional amendment. Plan requires two constitutional amendments, one for portability of savings and second to increase annual property assessment.
GOVERNOR
Double the $25,000 homestead exemption and allow homeowners to carry their Save Our Homes tax savings to new homes, and expand exemptions to businesses.

SENATE REPUBLICAN
Plan highlights unveiled Thursday:
• Roll-back property tax rates to 2005-2006 levels. After accounting for population growth and inflation, rates would be frozen for two years. After that, local governments could not increase revenue by more than the inflation rate. Public school districts would not be required to roll back rates.
• Retain Save Our Homes protections for homeowners and allows them to transfer up to $500,000 in savings when they move. If a homeowner purchases a more expensive home, tax increases would be limited to 10 percent a year until the tax equaled the new property's purchase value. Thereafter, the increases would be capped at 3 percent.
• Give first-time homebuyers an additional $25,000 homestead exemption, bringing the total to $50,000.
• Provide small businesses with $25,000 tangible personal property tax exemption. Sponsors say that would eliminate the need for almost 1 million businesses to file tangible tax returns and reduce the amount paid by 300,000 more businesses.
• Help landlords by assessing their property based on rental income, not market value, which is often higher.