Now Legislature will try again to fix tax problem

Eight weeks ago in this column, I discussed the proposal by Republicans in the Florida House of Representatives to fix the property tax problem.

I’m sure you remember the proposal: Property taxes would be eliminated on homesteaded properties and the Legislature would increase the state sales tax by 2.5 cents to make up the revenue shortfalls counties would suffer with the elimination of those taxes.

Earlier this month, before the regular legislative session ended, this plan did indeed pass the Florida House. However, the Florida Senate failed to pass similar legislation, and conference discussions could not produce a compromise bill before the session ended. Thus was born the special session this month that will send state lawmakers back to Tallahassee to, hopefully, get a bill passed.

There is good and bad to what happened during the last session. The overwhelming good was lawmakers were discussing this issue and working hard to find a solution. I have many friends who are all too familiar with the inequities of the current property tax system, and without some type of relief soon may find themselves forced to move out of the state.

I know many more people afraid to move up or move down from their current homes since the move would cost them their Save Our Homes exemption and cause the property taxes on their next home to skyrocket. Either way, not exactly an enviable position.

Had this proposal passed both chambers, the resulting home-building, home-buying spree in Florida would have been tremendous. Imagine talking to your friends in North Dakota and telling them they could buy a house in Florida and not pay property taxes. I’m not sure how much you really have to convince someone living in North Dakota to move to Florida, but just think how much faster they would get here knowing they wouldn’t be paying property taxes.

Plus, think of the sales taxes these new folks would put into state coffers. I venture to say that while counties would experience an initial hit to their budgets as their anticipated revenue streams decreased with the loss of property taxes, the effects would be very short term. The resulting sales taxes from these new residents would quickly bring in more dollars to the state, and thereby local jurisdictions, almost negating their short-term loss.

With the good comes the bad. The bad in this case is twofold. First, after all the debate and discussion, in the end we still are where we were when all this got started. Granted, the special session should produce legislation that will provide tax relief, but it was discouraging to watch legislators agree on the problem and not be able to fix it. However, the biggest downside to this whole situation was that the Legislature was put in a position to have to solve the property tax problem.

For several years, citizens have tried unsuccessfully to convince local lawmakers of the problem and the need for some kind of relief. While city and county commissioners may have heard the voices of the people, they weren’t listening. The sight of the goose laying the golden egg (property taxes) was just too juicy to turn away from.

City and county government must surely have felt citizens wouldn’t want to see local services cut in order to operate more within our means instead of spending everything they could get their hands on. I guess this thinking was pretty much wrong!

Now local government finds itself in a pickle trying to decide what goes and what stays when it comes to local services as it adjusts to the anticipated loss of revenue.