Real Property Tax Reform

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Real Property Tax Reform for Florida Families

A Presentation to the Florida Taxation
Budget Reform Commission


October 11, 2007
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Broward County Property Facts

• One of the fastest growth rates in the nation.
• Browards tax roll value is LARGER than several
  states.
• VERY HIGH concentration of condos average of
  642 condo unit/sq mile.
• Approximately 75 of the tax roll is residential
  based on taxable value and 90 of all parcels
  are residential properties.

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Broward County in 2007

• 1.8 Million Residents.
• 835,000 Parcels and TPP Accounts.
• 176.4 Billion in Taxable Value.
• 423 Square Miles of Non-Conservation, Developable
  Land.

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Recent Broward Market Activity

• Total of All Real Property Sales in Broward
• 2005 71,245
• 2006 51,332
• 07-YTD 23,513 (10-9-07)
• Total Residential Sales
• 2005 67,600
• 2006 49,420
• 07-YTD 22,068 (10-9-07)

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Taxpayers Demand Real Relief.

• Florida taxpayers are fortunate that the
  Governor, the Legislature and the State Tax
  Reform Commission all seem intent on examining
  every option to provide meaningful property tax
  relief for all property owners.
• - Lori Parrish

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The Parrish Tax Reform Agenda

• First-Time Homebuyers Assessment Limitation.
• Eliminate taxes on the first 25,000 in value of
  All TPP accounts.
• Ending Double Taxation Document Stamp Taxes for
  No Consideration Love and Affection Deed
  Transfers.
• Truth in Co-Operative Property Transfers.
• Tax Rate Disclosure DOR Data.
• Save Our Homes Portability.

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First-Time Homebuyers Assessment Limitation
Amendment

• Constitutional Amendment provides for a county
  local option for first-time homesteaders for up
  to 100,000 in assessment exclusion (or
  reduction) over a five year period -- provided
  that the homeowner remains homesteaded in the
  property for the full five years.
• Provides for a 120 (moderate income) of
  HUD-adjusted area median income.
• Eligible owners who fail to remain in the
  residence for the full five years must repay
  the additional tax savings previously claimed.
• Makes it possible for local workforce to
  purchase housing.

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Eliminate Taxes on Personal Property Accounts
Worth Under 25,000

• Entirely eliminate (exclude) the first 25,000 in
  value of all TPP accounts from taxation.
• Taxpayer has affirmative duty to file a tax
  return if TPP value ever exceeds 25,000.
• Cost/Benefit analysis will show this will
  eliminate over 80 of all Tangible Personal
  Property accounts in Broward County and result
  in taxpayer and agency savings through program
  reductions and reassignment of personnel.

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End the Double Taxation on Spousal Family
Property Transfers

• The problem A taxpayer pays doc stamps on the
  full value of a mortgage when it was originally
  recorded, and upon the deed when a property was
  first purchased. Despite this, a Florida
  property owner who adds a spouse or adult child
  (for estate planning) to the title of residential
  property, is hit with document stamp taxes again
  based upon the balance of the existing mortgage.
  
• Likewise, when a joint tenant deeds his/her
  interest to the other joint tenant(s), more doc
  stamps are owing again based upon the balance of
  the existing mortgage. This is double taxation!
• Amend Florida statutes to require only the
  minimumdocument stamp tax on love and
  affection deeds of previously mortgaged real
  property transferred between family members when
  no consideration changes hands and the grantor or
  grantee previously paid documentary stamps on the
  same mortgage to which he/she would be expected
  to pay again on a proportional share of
  outstanding mortgage balance.

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Truth in Co-Operative Property Transfers

• The problem Widespread under-reporting and
  mis-reporting on the true consideration paid for
  co-op units results in underassessment of co-ops
  and higher tax bills for owners of non co-op
  properties.
• Amend Florida law to require that the full
  consideration paid in any transfers of any
  ownership interest in a co-operative corporation
  be reported in the recorded documents.
• Require documentary stamp taxes be paid based
  upon true and full amount of consideration.

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Truth in Tax Rates DOR Data

• Require the Florida Department of Revenue to
  produce an annual report showing what counties
  and cities increased property taxes during the
  prior years, by what percentage, and by property
  classification.
• Require DOR and all Florida Property Appraisers
  to publish said data on their respective
  websites.

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PORTABILITY

• Unlocking the door to more reasonable property
  taxes, a healthier real estate market, and new
  home ownership

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The Parrish Proposal

• A State Constitutional Amendment designed to
  protect Florida homeowner rights by allowing a
  once-in-a-lifetime transfer of the Save Our Homes
  advantage to another homesteaded property of
  equal or greater assessed value.

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Parrish Proposal Facts

• Must be county local option just like the
  other property tax exemptions. County Commission
  must approve enactment.
• Restricted to portability only within the same
  county.
• Transfer of equal or greater value.

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Broward Strongly Supports Portability
November 2006 Portability Straw Ballot Election
Results YES 77 - 283,617 No
23 - 86,507

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Much uncertainty still remains as to if or when
Floridians will get real tax relief and as to
how much or how little it will ultimately be.
Hopefully, this presentation suggested several
ways to help Floridas struggling taxpayers.
www.bcpa.net