GOVERNOR CRIST PROPOSES PROPERTY TAX REFORM PLAN
April 26, 2007
Contact:
ERIN ISAAC
(850) 488-5394
TALLAHASSEE – Governor Charlie Crist today announced his suggestions for reducing the property tax burden by $34 billion on Florida’s homeowners, businesses and renters over a five-year period. The Governor’s proposal would encourage home ownership while also capping runaway spending by local governments.
“This plan would provide immediate relief to both those who are barred from the American dream of owning their first home and those current homeowners who feel unable to move and trapped by skyrocketing property taxes,” Governor Crist said. “By providing immediate relief now along with a plan for future reductions, we can reverse the trend of high property taxes and make living in Florida more affordable.”
Details of the plan include four components, including immediately rolling back local government revenue caps to 2003 levels, with an allowance for inflation and growth. Under the Governor’s proposal, Florida homeowners will benefit from a 12 percent tax cut on their property taxes on their homestead in 2007 and 21.5 percent in 2008. This measure would provide the homeowner of an average-priced home of $290,000 a savings of $340 on their 2007 property taxes. Over five years, each present-day homeowner would save $1,987 in property taxes because property taxes would not continue growing at their current rate.
“The revenues of local governments have ballooned over $17 billion beyond a responsible growth rate during the past five years, taking money out of the taxpayers’ pockets,” Governor Crist said. “We must give the people of Florida hope that relief from this tax burden is on the way.”
Governor Crist also proposed three additional components that require a constitutional amendment for voter consideration. The constitutional amendment would phase in three additional savings for property owners by 2008:
Provide an additional homestead exemption of $25,000. This measure would provide an additional average savings of $238. In addition to the tax rollback in 2007, the homeowner’s total savings would be an average of $601. If passed by voters in 2007, this property tax savings would begin in 2008.
Make Save Our Homes Portable While Also Providing Assistance to First-Time Home Buyers. Governor Crist proposes making the Save Our Homes cap portable statewide so that homeowners can take their current tax savings with them when they move. In the first year alone, the homeowner who purchases an average-priced home of $290,000 is expected to save an additional $923 in property taxes. If passed by voters in 2007, this property tax savings would apply to individuals who buy homes in 2007 and would affect their 2008 taxes.
Because portability of the Save Our Homes cap applies only to existing homeowners, an additional measure would ensure that first-time home buyers in Florida and new residents to the state would also benefit. Governor Crist recommends providing a 25 percent exemption for first-time home buyers, which would provide a savings of $546, or 11.9 percent.
Exempt the first $25,000 of businesses’ tangible personal property. Businesses would save $200 million annually on this property tax. If passed by voters in 2007, this property tax savings would also begin in 2008. By 2011, this exemption will save businesses a total of $800 million.
“I applaud House Speaker Marco Rubio and Senate President Ken Pruitt and the leadership of the House and Senate for their tireless work on exploring possible ways to reform property taxes,” Governor Crist said. “Now is the time to come together and find a way to relieve the financial burden on our citizens.”
Except for the exemption on businesses’ tangible personal property, Governor Crist’s property tax reform proposals do not affect funding for schools.
Earlier in the week, Governor Crist visited with about 300 citizens in Palm Beach Gardens and about 100 citizens in Orlando during town hall meetings to hear their concerns about rising property taxes. Lt. Governor Jeff Kottkamp held similar town hall meetings in Punta Gorda and Pensacola.
“We are hearing over and over that Floridians need hope that their property taxes will come down so that they can continue living in Florida,” Lt. Governor Kottkamp said. “This issue is impacting every Floridian, and it is time for us to make changes that will make Florida affordable once again.”