Amendment 5 thrown off ballot, chamber calls for special session

Thursday, August 14, 2008

Leon County Circuit Judge John Cooper has ordered Amendment 5, the tax-swap proposal that would eliminate about a quarter of Florida property taxes, off November’s ballot.

Education, business and political interests challenged the proposed amendment’s constitutionality, saying the summary that would appear on ballots was misleading.

State Sen. Mike Haridopolos, a chief opponent of the amendment, hailed the decision.

“This amendment is a bad deal for Florida and a bait and switch proposal of the worst kind,” Haridopolos said. “Even though we consider today’s ruling a victory for the voters and taxpayers of Florida, we will continue to fight against the amendment until all appeals are exhausted.”

Chuck Bonfiglio, president of the Florida Association of Realtors, said the court’s decision was a blow to property owners. The association pledged $1 million to try and pass Amendment 5, which would cut have cut at least 17 percent, and as much as 38 percent, from property taxes depending on the county.

“Homeownership is a fundamental right, and Floridians deserve a say on how their property is taxed,” Bonfiglio said in a statement. “We are shocked that the court decided to deny property owners’ the ability to dramatically lower their property tax rates.”

The Florida Chamber of Commerce has called on Gov. Charlie Crist to call a special session after November’s elections to address property taxes.

Cooper agreed with opponents arguments that the proposal’s description was not clear.

“The court finds that the ballot title and summary provided in the proposition for Amendment 5 fail to fairly inform the voter, in clear and unambiguous language of the chief purposes of the amendment and the language of the title and summary, as written, is misleading…” Cooper wrote.

Cooper’s ruling on the amendment, supported by the Florida Association of Realtors, Crist and others, is certain to be appealed.

“Voters need clear information, and this amendment fell short. It was called a tax swap, but it was never clear what we were swapping for,” said Florida Retail Federation President Rick McAllister, in a statement. “Amendment 5 would have exposed Florida’s schools to budget cuts by removing a stable property tax without a full explanation of how it would be replaced.  It would have been left up to future Legislatures to deal with the unknown consequences and tax increases.”

Amendment 5, placed on the ballot by the Taxation and Budget Reform Commission, would do away with the required local effort portion of county property taxes that go to support schools. The proposal directs the Legislature to replace the roughly $8 billion that would be lost with other revenue sources, including increased sales tax.

But Cooper said that because the proposal only directs the Legislature to replace the money in 2010-11.

“The clear implication is that the school funding lost by the cut in ad valorem taxes will be fully replaced by the State of Florida on a permanent basis,” Cooper wrote. “The proposed amendment does not do this. It provides a hold harmless for school for only one year.”

The Florida Chamber of Commerce, an opponent of Amendment 5, took Cooper’s ruling as an opportunity to call for broader property tax changes. Chamber President Mark Wilson, in a letter today to Crist, asked Crist to call a special session of the Legislature following November’s elections.

“The Florida Chamber believes a special legislative session is needed because Florida’s taxpayers have an urgent need for property tax relief and taxpayer fairness,” Wilson wrote. “To create more jobs and opportunities for Florida, we must enact immediate solutions that make our tax system fair and sustainable.”

The chamber proposes:

• Government revenue caps
• Greater assessment caps on non-homestead property
• Further rollbacks
• Easier tax challenges
• Changes to assessment standards of highest-and-best-use valuation
• Government spending transparency