The League of Women Voters of Florida 

The League of Women Voters of Florida opposes SJR 4, the proposed state constitutional amendment that will be placed on the special election ballot on January 29, 2008, because it would: 

(1)    Require the state legislature to limit the ability of local governments to raise revenues to meet local needs;

(2)    Extend and increase homestead tax limitations without regard to the ability of homeowners to pay; and

(3)    Worsen Florida’s current infrastructure deficit and the decline in the level of state services and in our quality of life. 

President Dianne Wheatley-Giliotti states that “The League of Women Voters of Florida has long held the position that local governments in Florida should have available a variety of options for generating revenues to meet local needs.  SJR 4 contravenes this principle because it requires that the Legislature limit the authority of local governments to increase property taxes.” 

In addition, the League of Women Voters of Florida believes that property taxes in Florida should be levied based on ability to pay, and that tax relief or circuit breakers should be provided for all low-income persons who own or rent property regardless of age.  By allowing current homesteaders to keep the Save Our Homes tax limitation, SJR 4 runs contrary to this principle – Save Our Homes is not based on ability to pay and has introduced a bias against more recent home buyers resulting in large inequities in the taxes they pay.   

Finally, the League of Women Voters of Florida believes that our state has a present infrastructure deficit, and state service levels and our quality of life are declining.  The League’s position is that sufficient state taxes should be levied to reverse the decline in levels of service and improve the quality of life for all Floridians. According to the Legislature’s own calculations, passage of SJR 4 will result in revenue losses of $3.6 billion in 2008-09 and as much as $4.4 billion by 2010.  These losses are in addition to the already mandated revenue cap passed by the Legislature during the special legislative session.  Over the next five years, the Legislature estimates that the loss of revenue will be $32 billion, more than 16% of Florida’s budget. 

Said Fiscal Policy Chair Terry Coble, “The losses in revenue occasioned by SJR 4 would result in unconscionable cuts to our state’s infrastructure and service needs at a time when revenue shortfalls are already causing the Legislature to reduce our existing state budget.”

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PROPERTY TAXES

What the Legislature Enacted in Special Session

LWVF’s Position on the Proposed Constitutional Amendment

Next Steps 

Prepared by Terry Coble

July 30, 2007 

1.         Summary of Tax Legislation Passed in the 2007 Special Legislative Session 

Three bills were enacted by the state legislature during the Special Session held June 12-14, 2007:  HB 1, SJR 4, and HB 5.  All three bills were signed by Governor Crist on June 21, 2007 and have become law.  The following is a very brief summary of the three bills. 

HB 1 – (1) This bill imposes a “rolled-back” real property tax rate on counties, cities and special property districts for the fiscal year 2007-08, and imposes maximum increases in tax rates and in total tax revenues that counties, cities and special property districts can collect in following years, on penalty of forfeiting the ½¢ sales tax revenues that are owed to them. 

(2)  HB 1 also enacts the statutory changes that are authorized if the constitutional amendments proposed by SJR 4 are adopted by the voters at a special election on January 29, 2008. See below for a description of the constitutional changes proposed by SJR 4. 

SJR 4 and HB 5 – These bills place a referendum on the ballot at a special election to be held on January 29, 2008, concurrently with Florida’s presidential primary.  SJR 4 contains the proposed substantive changes in the constitution, while HB 5 authorizes the special election and the expenditure to hold it.  If adopted, SJR 4 will apply retroactively to January 1, 2008 and will: 

(1)    Enact a new homestead exemption in the amount of 75 percent of the first $200,000 of the homestead value, plus 15 percent of the next $300,000; provide for annual increases in the upper limit based on growth in per capita Florida personal income; provide a minimum exemption of $50,000, or $100,000 for low-income seniors. 

(2)    Allow homesteaders now subject to the Save Our Homes (SOH) tax limitation as of January 1, 2008 to keep the existing exemption or irrevocably choose the new exemption.  Homesteads established after enactment may not elect SOH. 

(3)    Authorize an exemption from taxation of $25,000 of tangible personal property (this applies only to businesses, since the personal property of individuals is not taxed.) 

(4)    Authorize lower taxes for workforce housing, affordable housing, and working waterfronts. 

(5)    Require the state legislature to limit the authority of local governments other than school districts to increase property taxes. 

2.         LWVF’s Position on the Proposed Constitutional Amendment 

The League of Women Voters of Florida opposes SJR 4, the proposed state constitutional amendment that will be placed on the special election ballot on January 29, 2008, because it would: 

(1)    Require the state legislature to limit the ability of local governments to raise revenues to meet local needs;

(2)    Extend and increase tax limitations on homesteads without regard to the ability of homeowners to pay; and

(3)    Worsen Florida’s current infrastructure deficit and the decline in the level of state services and in our quality of life. 

A more detailed explanation of this position is set forth below: 

(1)  LWVF positions provide that local governments in Florida should have available a variety of options for generating revenues to meet local needs.  SJR 4 contravenes this principle by requiring that the State Legislature limit the authority of local governments to increase property taxes. 

(2)  LWVF positions state that property taxes collected in Florida should be equitable and levied based on ability to pay.  We believe that tax relief should be provided only to those who need it, for example through a “circuit breaker” that, like the device that automatically interrupts the flow of an electric current when the current becomes excessive, provides property tax relief for households when taxes on housing exceed a certain percentage of income.  SJR 4 is contrary to these positions because it allows current homesteaders to keep the Save Our Homes tax limitation, which has produced large inequities in the taxes paid by more recent home buyers, and which grants the same tax limitations to homeowners regardless of their ability to pay.  

(3)  LWVF positions provide that Florida presently has an infrastructure deficit, and state service levels and our quality of life are declining.  We believe that sufficient state taxes should be levied to reverse the decline in levels of service and improve the quality of life for all Floridians.  According to the Legislature’s own calculations, passage of SJR 4 will result in revenue losses of $3.6 billion in 2008-09 and as much as $4.4 billion by 2010.  These losses are on top of the already mandated revenue cap passed by the Legislature during the special legislative session.  Over the next five years, the total loss of revenue due to SJR 4 is estimated to be $32 billion, over 16% of Florida’s budget.  This will compound the revenue losses that the state is now projecting due to an economic downturn which is estimated to trigger an additional $1 billion in cuts to services and infrastructure during this fiscal year alone.