Florida voters are getting a chance to give tax relief to first-time home buyers, businesses, "snowbirds" and others who own second homes as well as put a more effective cap on state revenue growth, but both proposed state constitutional amendments have drawn widespread opposition.
They are among six amendments on the Nov. 6 ballot — out of 11 — that deal with tax relief and government finance.
All were put there by the Republican-led Florida Legislature and would advance the GOP's low-tax, small-government agenda.
Most of the public debate has focused on the state revenue limit in Amendment 3 and local property tax breaks in Amendment 4. They have drawn support from businesses interests. The opposition has included local officials, liberal-leaning groups and others. All amendments require at least 60 percent approval to pass.
Amendment 3 would replace an existing revenue cap tied to increases in personal income. It has never come into play due to rising personal income, tax cuts and revenue declines resulting from the recession.
The new version, instead, would allow revenue increases in step with population growth and inflation as measured by the federal Consumer Price Index.
Amendment 4 is intended to help first-time home buyers through an additional property tax exemption that would be available to people who haven't owned a house in the previous three years.
Local
The existing Save Our Homes Amendment limits annual property tax assessment increases to 3 percent on primary homes, or homesteads. Amendment 4 would give non-homestead properties a 5 percent assessment limit.
The measure also would let lawmakers prohibit primary homeowners' assessments from going up when their property values go down due to a quirk in Save Our Homes known as the "recapture rule." This provision would apply to school taxes but the other two would not.
The liberal-leaning, Washington, D.C.-based Center on Budget and Policy Priorities estimates Amendment 3 would cut state revenue by $11 billion over the first 10 years while Amendment 4 would cost local governments $471 million by 2016 if tax rates aren't increased.
"Amendment 4 is a wolf in sheep's clothing," said Leon County Commissioner Bryan Desloge, president of the Florida Association of Counties. He said it would mean longtime homeowners ultimately will have to pay higher taxes "to subsidize tax breaks for nonresidents and real estate investors."
The proposal is being pushed mainly by the Florida Association of Realtors to help sell houses.
"We have a glut of housing in Florida," said Trey Price, the association's public policy representative. "We need to dry up that inventory."
Price said the amendment is aimed at reducing rather than increasing taxes, but he acknowledged that's an option for local governments but "one we certainly don't endorse."
The proposal also is designed to reduce inequities caused by the Save Our Homes Amendment, which shifted some of the tax burden from homeowners to businesses and other non-homestead properties such as vacation homes and rentals when it went into effect in 1995.
Recent buyers also are paying higher taxes than longtime owners for a house of the same value. Some homeowners, meanwhile, felt trapped because they'd lose their Save Our Home benefits if they sold their houses and bought new ones.
In response, voters in 2008 passed an amendment that put a 10 percent annual assessment cap on non-homestead property and allowed homeowners to take at least a portion of their Save Our Homes benefits with them if they moved.
The 10 percent non-homestead assessment limit has had little effect in a down market, so Amendment 4 would drop it to 5 percent, but Price said even at that level it shouldn't have much impact on local budgets for several years. He noted the cap would come up for another vote in 10 years and said Realtors would push for repeal if it proves to be a problem.
Amendment 4's opponents also include the Florida League of Cities, individual local governments and officials and the League of Women Voters of Florida.
Major funding to oppose Amendment 3 has come from the PICO National Network, a California-based community organizing group of faith-based organizations.
The League of Women Voters, unions representing teachers, police, firefighters and other public employees, AARP, the Florida Alliance for Retired Americans, Florida Council on Aging, Florida Consumer Action Network, Florida Alliance of Planned Parenthood Affiliates, National Association of Social Workers of Florida are among about 50 groups also opposing Amendment 3.
"It bases the Florida budget on the current depressed recessionary budget and then severely restricts growth in future years," said Robb Gray, senior vice president of the Center on Budget and Policy Priorities. "It doesn't allow for natural growth."
Critics also say the revenue cap would reduce Florida's credit rating, which would increase the cost of borrowing for such projects as schools and roads. That's a reason cited by Arizona's Republican governor, Jan Brewer, for her veto of a similar revenue limit.
Amendment 3's supporters include a pair of leading business groups, the Florida Chamber of Commerce and Associated Industries of Florida. It's also a top priority for Senate President Mike Haridopolos, R-Merritt Island.
"This is not about hurting anyone," Haridopolos said. "This is about avoiding the radical ups and downs."
The Florida amendment was inspired by Colorado's Taxpayers' Bill of Rights, or TABOR, that opponents say is a proven failure because it was suspended and modified after forcing severe cutbacks in education and other services.
Haridopolos, though, said Florida has learned from Colorado's experience. The Florida version, for instance, doesn't apply to local government budgets and allows the Legislature to break the cap through a two-thirds vote of each chamber.
Also, money collected over the limit would go into a "rainy day" fund that can be tapped when times are bad. That should avert a downgrade in the state's bond rating, Haridopolos said.
The Florida amendment would base each year's cap on the prior year's limit starting in 2014-15. Colorado's TABOR used a lower figure — actual revenues collected — before 2010-11, when it also moved to the previous year's cap.
Other proposed tax breaks on the ballot:
— Amendment 2 offers special property tax exemptions to all disabled veterans with primary homes in Florida. An existing provision limits that benefit to disabled veterans who were Florida residents when they joined the military. The amount of the exemption matches each veteran's percentage of disability.
— Amendment 9 would provide full property tax exemptions to the surviving spouses of military veterans and civilian first responders who die while on active duty or in the line of duty. First responders include police, firefighters, correctional officers, emergency medical technicians and paramedics.
— Amendment 10 would double the exemption for personal property taxes that businesses pay for furniture, machinery, tools, equipment and other items.
— Amendment 11 would give another property tax exemption to low-income homeowners who are 65 and older and have lived in their houses at least 25 years.
