Tax plans may trim county's revenues
Published: Friday, January 5, 2007 at 6:01 a.m.
Last Modified: Friday, January 5, 2007 at 12:00 a.m.
Gainesville's Mike Blanchard is like a lot of homeowners — wide-eyed at his property tax bill.
But he is unlike others in that he's got several tax bills — he owns three rental homes and three rental townhomes.
So Blanchard is glad — but skeptical — that Gov. Charlie Crist and the Legislature seem intent on trying to do something about taxes.
"I think it would be wonderful, but the only way I can figure it out is if they are taking that much less from the homeowners, they are going to have to shift more of the onus on the businesses," Blanchard said. "That's where it's killing me because I have a bunch of investment properties. I'm having to take up the slack. I have to pass it on."
Realtor Anne Koterba is well aware of the pain, and sometimes heartbreak, caused by high taxes. But Koterba said residents deserve services such as parks and roads.
"Commissioners keep approving subdivision after subdivision west of Interstate 75. They are getting a lot of money from those people. Why not give them services?" Koterba said.
Balancing that public demand for lower taxes with the desire for services could be trouble for Alachua County in the next few years.
Taxation will be a hot issue for the Florida Legislature this spring. But capping taxes limits the amount of money the county can raise, which limits the money it spends on services.
So county officials are starting to plan for changes that could come in a few years.
"These are issues that sound good, but implementing them is a difficult issue," said Commission Vice Chairman Rodney Long. "We're talking about maybe gutting some departments — major surgery."
Public frustration over taxes swelled statewide last year and was a major election issue. Steep rises were due in part to rapidly escalating home values from an overheated housing market.
Former Gov. Jeb Bush created the Florida Property Tax Reform Committee to develop recommendations for relief.
In December the committee released an interim report that included several options for further study.
The most publicized is doubling the homestead exemption from the current $25,000 a year to $50,000. It would require a constitutional amendment.
Another consideration is Save Our Homes portability. Save Our Homes caps property tax growth at 3 percent a year. Taxes shoot up to the true value when the home is sold, so buyers end up paying more.
Save Our Homes is great for longtime homeowners who have no intention of selling. Others often find they cannot afford to sell because taxes on a new home — even a smaller one — would be too high.
Portability would allow homeowners to carry tax savings to a new home.
Alachua County Property Appraiser Ed Crapo said that in 2006 the $25,000 homestead exemption kept about $1.2 billion worth of property from being taxed, while Save Our Homes reduced the value of taxable property by almost $1.9 billion.
Crapo estimated that if the homestead exemption were $50,000, the total loss of the value of taxable property by 2011 would be $15.4 billion.
County budget and management Director Suzanne Gable said the $25,000 homestead exemption accounted for a loss of about $10 million in general revenue raised through taxes on homeowners countywide.
Unincorporated homeowners pay additional taxes for various services. Homestead exemption losses to those funds were $1.1 million for law enforcement, $780,000 for fire services and $275,000 for general services, Gable said.
Those losses would be roughly double with a $50,000 homestead exemption, Gable said.
Meanwhile, Save Our Homes cost the county about $16 million in the 2007 budget.
"We are absolutely planning with the mindset that there is going to be a change," Gable said. "In a county like ours this is a big impact."
Alachua County's taxing authorities reaped a windfall last year because of dramatically increased property values.
But Crapo believes the housing market has slowed. He said that may vent some of the current taxpayer steam.
"The appreciation is still going to be there, but it's not going to be at the phenomenal rate it was before, where people could buy something and make a killing on it in six months," Crapo said. "It will make the rate at which values go up slow down."
Also to be studied by the committee are caps on the amount of tax revenue local governments can collect and caps on the tax increases on individual property.
Some of the options are drawing opposition from the Florida Association of Counties, whose legislative program has been adopted by Alachua County.
Cindy Swirko can be reached at 374-5024 or firstname.lastname@example.org
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