Crist, Baker outline way ahead on taxes
By A TIMES EDITORIAL
Published April 27, 2007
Two influential voices are offering some helpful suggestions on property tax relief, and state legislators ought to hear them out. Gov. Charlie Crist and St. Petersburg Mayor Rick Baker are offering specific ideas that could advance the discussion and jump-start the stalled negotiations between the House and Senate.
For the first time, Crist is calling for rolling back local government property taxes. It would not affect schools, water management districts and hospital districts. And the governor who prefers compromise to confrontation has chosen 2003 as a rollback date. That is further back than the Senate wants but not as far back as the House plan. We have opposed across-the-board rollbacks, and turning back the clock four years would trigger untenable cuts in services and programs by cities and counties. But this is movement toward a middle ground, and that trend needs to continue.
Baker's most significant contribution to the debate is a thoughtful suggestion to limit increases in assessed value on nonhomesteaded property to 8 percent and make that limit retroactive to one year ago. That would steer immediate tax relief to the property owners who need it most and avoid double-digit spikes in property values in the future. While it would limit future revenue increases for local governments who have been enjoying the fruits of soaring property values, it would not decimate their budgets. Legislators interested in prompt, targeted relief should take a close look at the mayor's suggestion.
Both the governor and his hometown mayor also propose allowing current homeowners to take benefits from the Save Our Homes cap with them when they move. The Senate has a nuanced approach aimed at avoiding constitutional problems with so-called "portability"; the House has shown little interest. Similarly, Crist, Baker and the Senate offer varied plans to double the homestead exemption; the House doesn't.
See a trend? Most significantly, House Speaker Marco Rubio and his Republican allies stand alone in embracing a fatally flawed plan that could abolish property taxes on homesteads and increase the sales tax up to 2.5 cents. That won't fly economically or politically. But Rubio and House Republicans have put too much stock in bad advice from paid consultants still pushing the flawed ideology that taxes based on consumption rather than assets are fair; Proposition 13 was a good thing for California; and Reagan-era supply-side economics benefit everyone. That is a prescription for disaster in Florida, and Crist and the Senate know it. The governor is just too polite to say it.
As more rational fiscal conservatives begin to focus on common themes, Rubio needs to climb off the limb before it is sawed off behind him. The Miami Republican has set himself up to overpromise and underdeliver. He has gone on Spanish radio in Miami to criticize the governor and whine that everyone is against him Tallahassee. That might be good political strategy in Rubio's legislative district; it doesn't look so smart on a statewide stage.
The negotiations in Tallahassee have focused too much attention on the size of any tax relief and not enough on the wisdom of the policy behind the numbers. With just a week left in the legislative session, doing nothing now would be preferable to a rash agreement that further undermines the tax structure and still doesn't satisfy angry taxpayers. There's always the possibility of a special session, and the Taxation and Budget Reform Commission can deal with real tax reform in time for the 2008 ballot.
For lawmakers who still hope for a reasonable deal, St. Petersburg's governor and mayor have put some ideas on the table that could lead to something. The goal must be to provide adequate, fair tax relief for property owners who need it most - not to see who can claim the biggest tax-cut number and raise unrealistic expectations the highest.
[Last modified April 27, 2007, 08:23:51]
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