Tampa Tribune: Judge Orders Tax-Swap Amendment Off Ballot

Friday, August 15, 2008

By CATHERINE DOLINSKI

TALLAHASSEE - A circuit court judge ordered a tax-swap proposal off the fall presidential election ballot on Thursday in an opinion that is certain to be appealed.

The ballot title and summary of Amendment 5 “fails to fairly inform the voter, in clear and unambiguous language of the chief purposes of the amendment,” Leon County Circuit Judge John C. Cooper wrote Thursday in his 23-page opinion.

Amendment 5 would cut property tax bills 25 percent to 40 percent by eliminating the portion that state government requires to help fund K-12 public schools. Lawmakers would have to use other revenue to replace the lost school funding, which this year was about $8 billion.

Options for replacing those dollars include a sales tax increase, cuts to other parts of the budget and repealing sales tax exemptions.

Although the tax cut would be permanent, the guarantee of replacement funding for schools would apply only for one year, in 2010-2011. The ballot summary of the proposal leaves out that one-year caveat. Cooper agreed with the plaintiffs, a diverse coalition of education and business interests, that the omission would mislead voters into thinking the replacement would be permanent.

Another strike against the amendment: its title, which refers only to its tax-swap provision and not the other changes it would trigger for state government.

Amendment 5 would also cap at 5 percent the annual rise in assessments for non-homesteaded properties. It would add new restrictions to property taxes that local governments may levy. And it would require closer scrutiny of future sales tax exemptions proposed by lawmakers.

Cooper agreed with plaintiffs that voters might overlook those provisions since the title omits them. “Ballot titles and summaries cannot ‘fly under false colors’ or ‘hide the ball’ as to the proposed amendment’s true effect,” the judge wrote, quoting a 2000 opinion about another ballot question.

Crist ‘Disappointed’

Gov. Charlie Crist, who supports Amendment 5, said he was “disappointed and not dismayed” by Cooper’s opinion since the case is headed for appeal. “It doesn’t mean anything.”

Mark Herron, attorney for the Yes On 5 For Property Tax Relief political action committee, said Thursday that he was preparing to sign his notice of appeal. “I don’t think we would do the appeal if we didn’t think there’s a reasonable basis for success.”

Amendment 5 supporters and opponents continue to wrangle over its cost. Estimates of the total revenue that would need to be replaced in 2010-2011 range from $9 billion to $11 billion; state economists are working on their own analysis.

The amendment comes from the state Taxation and Budget Reform Commission and has the backing of Florida’s Realtors, who think it will bolster the flagging economy by boosting real estate sales.

The plan has attracted the opposition of an array of other interests. Education groups fear that the plan will jeopardize school funding in the long run, and industry worries that lawmakers will have to raise taxes on sales and possibly services to pay for schools. School boards and superintendents joined forces with Associated Industries of Florida and other groups to file the complaint.

Senate Finance and Tax Chairman Mike Haridopolos, the plan’s foremost critic, has argued that the budget commission failed to identify adequate sources of replacement revenue when it approved the amendment, which he said will necessitate a massive tax increase.

“We will continue to fight against the amendment until all appeals are exhausted and we are certain that Florida’s hardworking families are free from this crippling tax increase,” Haridopolos, R-Melbourne, said in a statement Thursday.

Chamber Of Commerce Opposed

Another opponent, the Florida Chamber of Commerce, responded with a letter to Crist calling for a special session to pass other property tax relief measures. Crist, who appeared with Mark Wilson, Chamber president, at an unrelated news conference, was noncommittal.

Amendment 5 is one of seven questions that the state Taxation and Budget Reform Commission voted to place on the ballot, three of which face court challenges.

Wednesday, the 1st District Court of Appeal announced that it would send a challenge from the state teachers union to two pro-voucher amendments directly to the state Supreme Court rather than issue its own ruling first. The teachers, who are appealing a loss in circuit court last month, are arguing that the budget commission exceeded its authority by taking up the vouchers issue at all.

Herron said he will ask the appellate court for the same treatment in the Amendment 5 case, noting that the state will have to begin preparing November’s ballot soon after the Aug. 26 primary.

“Here you have an even more compelling reason to pass it through, because you have a court now saying it won’t be on the ballot, and so there’s a real immediate need for review in that case.”