Crist carries tax cut to victory
Published: Tuesday, January 29, 2008 at 10:45 p.m.
Last Modified: Tuesday, January 29, 2008 at 10:45 p.m.
Voters approved a historic property tax cut Tuesday, deepening the benefits for longtime residents by making permanent their tax advantage over businesses, first-time homebuyers and part-time residents.
Amendment 1’s passage, with well over the necessary 60 percent of votes, also marks a huge political victory for Gov. Charlie Crist, who campaigned in 2006 on the promise to increase the homestead exemption and allow residents to keep their accrued Save Our Homes tax break if they move.
‘‘I think what it means was that the people wanted a tax cut very, very badly,’’ Crist said in Miami. ‘‘They wanted it and now they got it.’’
Opponents said Floridians will see little tax savings and dramatic cuts in law enforcement and education. But Rich Templin, a spokesman for the Florida AFL-CIO , said tight economic times meant voters welcomed any tax cut.
‘‘Even though it's only a $20 (monthly) savings for the voters, they want that $20,’’ said Templin. ‘‘This really is going to destroy a lot of services for a lot of people. People are not going to believe it until they see it.’’
The popularity of any tax cut was almost certain to gain a majority of Floridians’ support. But Crist’s popularity, rooted in his appeal to both parties, was the key in pushing Amendment 1 to the necessary 60 percent.
‘‘This was not a partisan issue that the governor championed,’’ said Rep. Jack Seiler, D-Wilton Manors. ‘‘I think Charlie Crist is the best retail politician in this state. He put his political firepower behind this amendment.’’
‘‘Charlie Crist proves again that he truly is the people’s governor; this is a big win for Floridians and for Gov. Crist,’’ said Senate President Ken Pruitt, R-Port St. Lucie.
For residents, Amendment 1 increases the homestead exemption and allows them to keep accrued Save Our Homes tax breaks if they move.
Businesses and part-time residents will receive a new 10 percent cap on year-to-year assessment increases in the future, and businesses will get a new $25,000 exemption for equipment.
Economists from the Legislature, academia and think tanks all have warned that the new tax plan only deepens the shift of taxes to businesses, part-time residents and new homeowners. Longtime Floridians will now have a permanent tax cut of hundreds or thousands of dollars that they will keep regardless of where they move in the state.
Lawmakers struggled for months before reluctantly putting the plan on the ballot, and even then it was a desperate result borne of finding what could possibly come near the 60 percent threshold for voter approval. Few legislators felt passionately about Amendment 1, leaving Crist as the indefatigable cheerleader.
‘‘It (the tax cutting plan) might not be Mr. Right, but it was Mr. Right Now,’’ said Bill Herrle, the executive director of the National Federation of Independent Businesses in Florida. ‘‘At one point I felt like me and Charlie Crist were the only people in Tallahassee who thought this would pass.’’
Legislative economists predicted Amendment 1 would reduce local government funds by more than $9 billion over five years, with about $1.6 billion of that coming from K-12 funding.
The real world impact of those cuts is unknown, but those fears framed the opposition’s argument.
Opponents, led by law enforcement and public school unions, said the cuts could jeopardize public safety by lowering the numbers of police officers and firefighters.
Crist dismissed those warnings, saying that local governments survived before the tax revenue windfalls earlier this decade and should do so again with residents unaffected by the cuts.
Lawmakers ignored their own study that showed ‘‘portability’’ of Save Our Homes benefits greatly increases the chances that a federal judge could find the tax break is unconstitutional. Existing legal challenges against Save Our Home may be bolstered by Amendment 1’s passage and the deeper shift of the tax burden. Out of state owners of part-time residences in Florida have already sued the state, saying Save Our Homes violates the federal constitution by forcing them to pay more than their share of taxes. Another suit includes new homebuyers in the state who make the same claim.
While Crist’s ‘‘Yes On One’’ effort raised a modest $4 million, it was enough to air TV and radio ads, send direct mail fliers and dial up automated phone calls urging a ‘‘yes’ vote. The one constant in the multi-media assault was Crist’s face and voice.
Polls conducted for ‘‘Yes On One’’ showed a stunning approval rating for Crist of around 75 percent, a figure that crossed party lines and even to those who said they would vote against Amendment 1.
Even Save Our Homes only received about 54 percent of the vote in 1992.
With elections in November looming, lawmakers may not have the appetite for months of grueling battles when last year’s debate resulted in a failed plan.
Crist has repeatedly promised that pass or fail, Amendment 1 would not mark the end of legislators’ tax-cutting crusade.
But Pruitt said earlier this month that he was not inclined to enter the fray while an historic meeting of a constitutionally created committee was studying the issue.
The Taxation and Budget Reform Commission meets ever 20 years with its 25 members selected by the House, Senate and governor. It has a few more months of work before it offers any proposed constitutional amendments.
‘‘It would be disrespectful of me to be trying to pre-empt whatever there is that’s going to be put on the table’’ by the budget commission, Pruitt said.
The budget commission has debated dozens of ideas. But the need to get 17 votes to put a measure on the ballot may limit the possibility of sweeping plans coming forward.
House Republican leaders have sent mixed messages, led by the increasingly lonely conservative standard-bearer, House Speaker Marco Rubio, R-West Miami.
Rubio has pushed varying plans to cut or eliminate property taxes in exchange for an increase in the sales tax. He is currently supporting a petition-gathering effort that would make all property taxes — for homeowners, businesses and part-time residents — 1.35 of each property’s assessed values.
But it is unlikely that the necessary 600,000 signatures could be gathered by this week’s deadline for the November ballot.
That would allow Rubio, who is term-limited out of office in November, to maintain a statewide presence as the effort rolls toward the 2010 election.
Rubio has sent mixed signals about the odds of lawmakers seeking another property tax cut plan. He said last year that he was disappointed that Amendment 1 fell short of a needed revolutionary change and that senators had gone as far as they would go. But earlier this month, Rubio said the House may indeed revisit the issue and he included the 1.35 percent plan as an option.
Lost in all the political posturing is the fact that lawmakers already forced local governments to cut property taxes by billions last year, and required any future increases to be limited at the rate of inflation and population growth unless a super-majority of local officials override the cap.
‘‘There isn’t a local government in the state of Florida that needs the governor, or me, to lower property taxes,’’ said Rubio, but added that lawmakers need to exert themselves. ‘‘People have an expectation that we need to do better.’’
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