Property tax plan doesn't fix inequities
By HOWARD TROXLER
Published February 1, 2007
From time to time, my cat Abou delivers a fruit rat to the front door. I always feel a little ungrateful about complaining, since he went to all the trouble.
In the same way, I hate to seem ungrateful to our new governor, Charlie Crist, who delivered a big box labeled "Property Tax Relief" to the front door this week.
But on balance, the fruit rat is looking better.
The governor is right that we need to do something. Florida's property taxes are all messed up.
What he wants to do, however, is to give popular tax breaks while not fixing the overall situation and in some cases making it worse.
Here's our basic problem:
- Homeowners enjoy a tax cap in Florida - our property value can go up no more than 3 percent a year - but only as long as we stay in the same house. As soon as we buy a new house, we get whacked with a shocking new bill. People don't want to move. People don't want to buy.
- Yet meanwhile, local governments keep spending more money. We can debate whether that's a necessity or a luxury. But they are doing it, and they are taking it out of the hides of all the other, nonhomestead taxpayers.
With each passing day, therefore, Florida is getting more and more unfair. Next-door neighbors pay wildly different taxes for living in the very same place, depending on when they bought.
And try to run a mom-and-pop business - or try to hold onto any nonhomestead property - while getting stomped with tax hikes that can be 40 or 50 percent.
Something's gotta give.
Enter the governor. First, his plan is to double the tax exemption for homeowners, from the first $25,000 to $50,000 of a home's value.
Yay, a free lunch! As a homeowner, I ought to jump up and down and say, selfishly, the heck with everybody else.
Except, you have to figure local governments will just raise taxes and revenue sources elsewhere.
Crist would also make the tax cap "portable," meaning that you could buy a new house and keep your old cap. But that preserves all the existing inequalities, and it does nothing to help the new home buyer, who still gets whacked over the head.
Next, says the governor, let's create the same 3 percent-a-year tax cap for everybody else, homeowner and nonhomeowner alike. Hey, it's a start - we'd all be treated the same in the future.
But again, it keeps all the past unfairness in our system. Plus it creates new inequality. In just a few years, we'll be hearing about how terrible it is that Business X is paying twice as much in taxes as its competitor, Business Y.
So, what's the answer?
Well, if we're in the mood to do something big, then why not just cap the growth of government spending altogether? Forget giving some people better deals than others.
Yay, a cap on government spending! A free lunch!
Except it wouldn't be.
It's fun to believe the government is run by free-spending drunken sailors. But the truth is that the cost of local government has not grown too much faster than that of state government.
Stuff costs money. So if we did this, we'd have to cut big at City Hall, at the School Board and the County Commission. I'm up for trying if you are.
Even so, it would be much better if we were all playing by the same rules. We should start from, uh, scratch.