Florida weighs a cut in property taxes
Homes in the town of Celebration, Fla.
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Scott Jagow: Congress could pass this economic stimulus package next week. Which means people might get tax rebates checks starting in May.
Floridians might get something else: a cut in their property taxes. The state votes on this Tuesday, the same day of Florida's presidential primary. Marketplace's Dan Grech has more from WLRN in Miami.
Dan Grech: South Florida was the epicenter of the housing bubble. Now, it's ground zero for the housing market collapse.
Adam Sanders is with the 11,000-member Realtor Association of Greater Fort Lauderdale:
Adam Sanders: The economy's been struggling, the housing market has tanked. And we think this amendment will begin to alleviate some of that pressure.
Property taxes have galloped up by as much as 30 percent a year for commercial properties and second homes. The amendment caps those increases to 10 percent a year.
Owners of primary residences would be the biggest winners. The amendment caps the annual growth in their taxes at 3 percent, and it gives them a bigger tax exemption. Florida residents would save about $240 on their next property tax bill, due November 1.
Homeowner David Adan says it will be like an early Christmas present:
David Adan: It's nice to have some kind of relief, so you're able to use that money, you know, to buy gifts and enjoy the holiday with your family.
In all, economists say over five years, Florida would forfeit about $9 billion in tax revenue. Under the amendment, businesses, renters, and retirees with second homes in Florida will continue to pay a disproportionate amount of taxes. They say that's unfair.
Dominic Calabro is president of Florida Tax Watch, a pro small government group that opposes this amendment. He thinks the tax code should be overhauled, not tweaked.
Dominic Calabro: We think when something continues and exacerbates the problem, from a policy standpoint, it's harmful.
As Tuesday's vote approaches, the issue has become a political football. Republican Governor Charlie Crist is stumping for the pro-amendment camp. And presidential candidate Rudy Giuliani, whose political fortunes rest on Florida, has adopted the amendment as part of his own tax-cutting agenda.
Rudy Giuliani: We think this is a place for us to get our message across the best. After all, this is a state that has a property tax proposition on the ballot on January 29.
The property tax amendment needs to pass with 60 percent approval. Polls show the vote is too close to call.
In Miami, I'm Dan Grech for Marketplace.