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Get tax reforms right or go home
By A TIMES EDITORIAL
Published May 2, 2007
If Florida legislators can't reach a reasonable compromise on property tax relief and explain it to taxpayers by sundown today, they need to give up, at least for now. This issue is far too important and too complicated to cut a backroom deal at the last minute and then ram it through the Legislature just before the session ends Friday. As Senate President Ken Pruitt observed Tuesday, nothing good happens when lawmakers rush or work late into the night.
Floridians need property tax relief, but they need it done right. That means it has to be equitable, fair and reasonable. It should be targeted toward the taxpayers who need it most: businesses, nonhomesteaded property owners and recent home buyers. It should spread the tax burden, not merely shift it from one group of taxpayers - homeowners - to another - consumers who may not even own property. And it should not force local governments to make painful cuts in programs and services that residents expect in safe, vibrant communities.
Legislators feel the public pressure to do something - anything - in the next three days. It is understandable they aren't looking forward to returning home this weekend and explaining why they failed to address the state's top priority. But doing nothing now is preferable to hastily agreeing on a deal that is not well understood or well reasoned. The worst outcome would be to approve a plan that makes the tax system even more unfair and offers false hope.
There are legitimate reasons why legislators are struggling to find an answer to the property tax crisis. The situation was created by historic increases in property values and by Save Our Homes, the constitutional amendment that artificially limits annual increases in assessed values for tax purposes on homesteads to no more than 3 percent. But it's difficult to turn back the clock and roll back property tax revenues to provide substantial relief without squeezing local governments. And nobody has figured out what carrot might persuade voters to adjust the Save Our Homes cap and spread the tax burden more fairly.
In Tallahassee, House and Senate negotiators have been unable to agree on the size of tax relief and on how to provide it. The Senate's package, which includes rolling back property tax revenues to 2005, doubling the $25, 000 homestead exemption for first-time home buyers and allowing homeowners to take the Save Our Homes benefit with them, is more reasonable and thoughtful than the House's plan. House Speaker Marco Rubio's plan to roll back property tax revenues to as far back as 2001, potentially abolish property taxes on homesteads and raise the sales tax by up to 2.5 cents, is as regressive as it is reckless. Gov. Charlie Crist's proposed compromise, which includes elements of the Senate's package but rolls back property tax revenues to 2003, is not enough for the House and is too much for the Senate.
There are two significant changes legislators could approve before Friday. There is widespread agreement to limit commercial property assessments to current use instead of best use. There also is a consensus to exempt $25, 000 in business equipment from a tax on tangible property. But lawmakers don't seem inclined to break these pieces away from the broader negotiations.
Barring a miracle today, a time-out is in order. The governor always can call a special session of the Legislature in a few weeks after everyone has had time to reconsider the options, including some that aren't on the table now.
Rubio is right about one thing - there is no point in passing a "Tallahassee special" that promises Floridians one thing and delivers something else entirely.