Politics

Tax reform in jeopardy

By Steve Bousquet and Alex Leary, Times Staff Writers
Published October 24, 2007

ADVERTISEMENT [Scott Keeler | Times] A grim-faced Gov. Charlie Crist reacts to the impasse on property tax legislation. The Buzz: Read comments, share yours

TALLAHASSEE - Hopes for an agreement on a plan to cut taxes for Florida homeowners and businesses faded further Wednesday as Senate President Ken Pruitt told senators to stay home at least until Monday.

The decision now leaves lawmakers in an extremely tight jam: They have only one day to agree on a plan to put a tax cut proposal before voters on the Jan. 29 statewide ballot.

Pruitt acknowledged that it won't be easy.

"The time clock is not our friend," he said.

If lawmakers can't agree on a ballot proposal to enlarge the homestead exemption, expand the Save Our Homes tax cap and other changes, it will rule out any possibility of increased tax relief until 2009.

Gov. Charlie Crist paused for 15 seconds to speak with a reporter on his way into a meeting Wednesday morning.

"I continue to be encouraged," Crist said. "I talked to the Senate president. I think it's going to work out. Am I disappointed? No, I'm not disappointed. I'm patient."

The question is whether Florida taxpayers will be as patient as Crist. He has invested much more time and effort on property taxes this round than he did in April or June, but he has been unable to broker an agreement between the Senate and House. Earlier this week, Crist said: "It's up to the leadership. The ball's in their court."  

A ranking House Republican called the development "extremely disappointing" and lashed out at Pruitt's insistence on hewing to a pre-arranged framework.

"I’m not sure what playbook they are using," said Rep. Ellyn Bogdanoff of Fort Lauderdale. "It’s a shame. Hopefully we can come to an agreement. We can’t get hung up on the initial framework."

Pruitt sent a memo to senators Wednesday morning that made it clear the Senate prefers its own tax package to the one the House passed Monday.

"Should we proceed with a tax reform and reduction package, we believe it will be important to include the basic principles that were the foundation of the Special Session call," Pruitt's memo said. "First, we must reduce property taxes for Floridians. Second, we must minimize any negative impact to education. Finally, we must craft a proposal that will be understood and accepted by Florida voters.

"Senators, these important points will be the basis of any plan that would be considered," Pruitt continued. "Because our Governor and our partners in the House of Representatives have publicly shared these goals throughout the process, I believe we have reason to be cautiously optimistic. However, there is still much work to be done, and the time clock is not our friend."

The collapse of tax talks reflects a growing estrangement between Pruitt and his counterpart, House Speaker Marco Rubio, R-West Miami.

The House made two moves last week that the Senate considered an affront to the deal even to call a special session. A committee added to the legislation a cap on nonhomestead property and a 1-cent sales tax increase to cut school property taxes.

Senate leaders quickly determined the changes were outside the framework of a deal agreed to by Pruitt and Rubio, and as early as Friday there were signs the session was beyond repair.

"When two business people have an agreement, if there is one of the parties that wants to change the agreement, you can't change the agreement at the end. You start anew," Sen. Dan Webster, R-Winter Garden, said Friday. "I think we have to start all over."

The sales tax swap was discarded, but the House changed the plan once again by adding a homestead exemption worth 40 percent of the median housing value in a county.

The House passed the plan 108-2 on Monday night.

The breakdown in negotiations could hurt Gov. Charlie Crist's standing with voters because Floridians generally view the governor as the most influential policy maker. 

According to a new Quinnipiac poll, 74 percent of voters support doubling the homestead exemption and 57 percent support making it portable, so it would apply to their purchase of a new house. Voters were split 46 to 44 percent about giving first-time home buyers a tax break.

"Even Rep. Dan Gelber is running away from his vote," said Sen. Mike Fasano, R-New Port Richey. "They're worrying about the impact on schools."

Like many lawmakers, Fasano has been on the receiving end of e-mails from frustrated constituents demanding action on property taxes. He has said he dreads what the reaction will be if the Legislature fails to offer a tax-cut proposal on the Jan. 29 ballot.

"There's still hope," Fasano said.

Steve Bousquet can be reached at bousquet@sptimes.com or (850) 224-7263.

[Last modified October 24, 2007, 11:14:12]