Local Property Taxes Fell 8 Percent in Three Years
Lower property values, local government restraint and a 2007 state law capping increases have combined to save Florida property owners more than $2.5 billion in local property taxes over the past three years, state revenue officials told a Senate panel on Thursday.
Amid a growing clamor from Tea Party-types and other fiscal conservatives, the 7.5 percent reduction in local taxes is being lost in the fog, said Sen. Thad Altman, R-Melbourne, and chairman of the Senate Finance and Tax Committee.
Local and state officials are not getting the word out to constituents that real savings followed a surge in property tax burdens during much of the last decade, Altman said following a presentation by the Florida Department of Revenue.
Since 2006, total local tax levies fell 7.5 percent, with the non-school portion of the tax bill falling even further. Non-school taxes fell $2.2 billion, or 12 percent. During the same period school tax rates, which are not subject to mandatory rollbacks, fell by less than 1 percent.
“The news is that the size of government is reduced and the tax burden is reduced by historic proportions and multi-billions of dollars,” Altman told the News Service. “It is somewhat ironic that you are seeing a lot of protests on taxes. If it’s being directed toward the state, it may be misdirected.”
James McAdams, the Department of Revenue’s property tax oversight director, said officials don’t know yet what portion of the reduced collections is due to caps placed on local tax increases in 2007 following a doubling of local taxes between 2000 and 2006 as Florida experienced white hot growth.
Property values fell and local governments, responded to voter outrage by further restraining millage increases they could have taken within the parameters of the 2007 legislation.
“It’s all part of the mix,” McAdams said.
Looking ahead, Altman said only small revisions in the Save our Homes tax increase cap are likely to be addressed by lawmakers this year, if at all. Save Our Homes limits growth in property tax assessments to 3 percent a year or the consumer price index.
There have been calls for looking closely at the increase because business groups and others say it puts undue burden on commercial property owners and recent home buyers who don’t get the benefit of the limit.
One measure dealing with Save Our Homes that lawmakers may address would eliminate a portion of the 2007 law that requires rates rise at least by the CPI. That would prevent a tax increase when property assessments go down.
Some homeowners have complained that their property taxes will rise this year despite declining property values across the state because of that provision.
Given the state’s current budget situation, Altman said it may not be prudent to further reduce tax rolls by providing even more benefits to property owners who already enjoy the benefits of recent tax reforms.
“I’m open to looking at it but I think we need to have an open and frank decision,” Altman said. “We want to give property tax relief where property tax relief is needed most.”