Legislators approve $31.6B property tax plan

Good News For Florida Home Owners!

The Florida Legislature Thursday backed a property-tax reform package that is expected to save Florida taxpayers $31.6 billion over the next five years.

The first part, a $16 billion plan that would go before voters in a special election Jan. 29, involves replacing the Save our Homes limit of 3 percent property assessment growth with a new "super exemption." The second part, pegged at $15.6 billion, requires all cities and counties to roll back tax rates for the 2007-08 fiscal year to the previous year's levels.

Gov. Charlie Crist says in a prepared statement this decision will help property taxes "drop like a rock."

"I congratulate Senate President Ken Pruitt and House Speaker Marco Rubio and the many other legislators who have worked tirelessly to build consensus among the members of the Legislature and deliver the largest tax cut in Florida history," Crist says. "By lowering property insurance rates and cutting property taxes, we will create a better bottom line for Floridians and for Florida."

According to details of the plan, the super exemption will give homesteaded properties a 75-percent exemption of the first $200,000 in value of a home with a minimum exemption of $50,000 per homestead. In addition, properties eligible for homestead exemption will obtain another 15 percent exemption for the next $300,000 in value.

That plan also will grandfather the tax savings and assessment cap for the smaller number of property owners who receive a bigger break under "Save Our Homes," as well as preserve all existing exemptions now provided to disabled veterans, low income seniors and agricultural lands. The Legislature also says it intends to "hold schools harmless" from the cut in school funding they will get from municipalities, who will are expected to receive reduced revenues through this plan.

Meanwhile, the rollback plan, which would not require voters approval, says local governments also have to make additional cuts of 3, 5, 7 or 9 percent, determined by a formula that measures each municipalities' taxing performance over the past five years against a statewide average. Special taxing districts and "fiscally limited" cities and counties will be held to the 3 percent additional cut.

The plan also caps future property tax revenues based on the rate of personal income growth and new construction, to ensure government cannot grow faster than personal income.

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