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"Super exemptions" could cost local budgets millions

Appraisers figure the impact of "super homestead."

By MIKE DONILA, Times Staff Writer
Published August 24, 2007

Want a bigger tax break? Get ready for some sacrifices, local leaders say.

Governments across the Tampa Bay region are bracing for deep repercussions if voters sign off on the super homestead exemption, the second part of the state's plan to curtail property tax revenue.

In Clearwater, officials warn that recreation centers and a library could face the chopping block. Largo says it might ax a 20-year-old after-school program and a nature park. Operating hours at Hillsborough libraries may shrink.

And in St. Petersburg, officials say the little money they saved for arts and social service groups would most likely disappear.

The discussions come as the county property appraiser's offices this week tallied "worst-case scenarios" for governments throughout the region if voters approve the proposed constitutional amendment on Jan. 29.

The results? Anywhere from a paltry $39,000 hit for Belleair Beach to more than $101-million for Hillsborough County. Pinellas County would bring in about $51-million less, while St. Petersburg estimates the hit at $10.4-million and Clearwater about $3.6-million.

"Recreation, law enforcement and fire services certainly won't escape this next round of cuts," Pinellas County Commissioner Ken Welch said. "More jobs, more services, everything. You can't squeeze blood from a turnip, and we're at that point."

Officials in Hillsborough County say they set aside $30-million in case the super exemption passes. But that doesn't mean the cuts won't be difficult, said Eric Johnson, the county's director of management and budget.

The super exemption -- which needs 60 percent voter approval to pass -- would exempt 75 percent of the first $200,000 of property currently with a homestead exemption, and 15 percent of the next $300,000. The new exemption does not include the 3 percent Save Our Homes cap.

To measure the possible impact, appraisers calculated this year's taxable values as though the new exemption was available, and every homeowner selected the option that would provide the biggest tax break.

"It's a good ballpark figure and a good exercise for (cities) to have, so they'll have an idea about how it will affect them," said Pinellas County chief property appraiser Pam Dubov.

Still, some say the local leaders are crying wolf.

During this summer's first round of state-mandated tax cuts, officials threatened to chop a number of services and jobs. They did, but not to the degree they predicted.

"I'm not surprised by the reaction," said state Rep. Ed Hooper, R-Clearwater. "The first time it was gloom and doom, and they said they'd have to lay off firefighters and police officers, and they didn't know how to go on. Well, it was a good exercise, but they didn't lay off any fire or police."

The first part of the Legislature's plan to slash taxes pushed local property tax collections for the upcoming fiscal year below the current year's levels.

To accommodate the rollback, cities and counties chopped jobs, slashed library operating hours and reduced funding for affordable housing programs, youth athletics and neighborhood enhancements.

The second part of the tax package is the super homestead exemption.

Most taxpayers would be immediately better off under the super exemption than they are now under Save Our Homes protection, which caps at 3 percent annual increases in assessments on homesteaded properties.

But how beneficial the super exemption will be in the long term depends largely on how long homeowners plan to stay in their homes. In general, the longer they stay, the more likely they will be better off keeping the existing Save Our Homes cap and $25,000 exemption.

Local officials say they just want people to be aware the amendment will affect more than just their pocketbook.

"We've been thinking about the January vote a lot and if we lose another $2-million, there are things that will go away," said Largo Mayor Pat Gerard, responding to the possible impact for her city.

"People say there is a lot of fat in our budgets, and that's just not true," she said. "Yeah, if the referendum passes, we'll be cutting some programs that people like a lot."

Staff writers Aaron Sharockman and Bill Varian contributed to this story.

FAST FACTS: Local coffers wouldn't be filled as deeply

The Pinellas County Property Appraiser's Office tallied worst-case scenarios for local governments if voters in January okay the super homestead exemption. Here's a look at how much less some cities and the county would collect:

Largo: $2-million (-12 percent in property tax revenues)

Clearwater: $3.6-million (-7.5 percent)

St. Petersburg: $10.4-million (-11 percent)

Dunedin: $1.2-million (-14 percent)

Pinellas County: $51-million (-12 percent)

[Last modified August 24, 2007, 01:15:29]