Wary of any property tax miracle

Here’s a riveting Monday topic: Taxes.

Oh, not just taxes. PROPERTY taxes! Yay!

Most, but not all, owners of property pay a property tax. We’ve had the property tax system in Florida since at least 1885. 

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Every state in the country collects property tax. It could be super cheap (Alabama, $718/year) or not so cheap (New Jersey, $8,900/year).

Looking at those extremes, we’re on the lower third in Florida, averaging $2,338 a year. Citrus County fits right in there…the average bill is $1,963, excluding city rates.

Not surprisingly, property taxes carry a lot of weight. Example: The county had roughly the same millage rate in 2015 as it does this year. But the revenue in 10 years nearly doubled to $132 million. That’s a growing chunk of change. (Here's the county budget.)

That’s just the county. They’re an even bigger deal to cities and the School Board.

So, when Tallahassee legislators start monkeying around with property taxes, it gets some attention.

You may have read that the governor and some legislators want to get rid of property taxes. Before we go there, a little side note.

One, it’s pretty ironic that the political party overseeing this state government for the last decade suddenly wants to make everyone efficient. Not sure how they reconcile that with the public.

Second, and this comes from experience, I’m wary when the state government wants the local government to “live within its means.” That way legislators can bask in political sunlight while local services crash and burn.

What is it about the state government that wants to wrest local control from the locals? Term limits for School Board/County Commission, doubling the homestead exemption, removing property taxes in exchange for pixy dust. Oh, and the governor wants to make it more difficult for citizens to get proposed constitutional amendments on the ballot.

So, there you go. At the outset, I’m suspicious. This is a control thing, state politicians making hay while the locals squirm.

Now. About property taxes.

I admit they’re a tough nut to crack. Unless that’s your field of expertise, I don’t know many people who can explain property taxes and how they’re derived. Same with the homestead exemption.

Property Appraiser Cregg Dalton was saying recently how citizens are confused when two homes on the same street, both relatively the same size and age, can pay entirely different taxes. A slew of factors come into play. (His website contains a ton of great info.)

The property tax system is also rather subjective. Unlike paying tax on goods or services, the tax rate (millage) is multiplied against a value, not an actual thing.

Plus, for decades now I’ve heard that the property tax structure is unfair. Higher priced homes pay more taxes, but require fewer services, than homes that skip by paying little or no property tax when their values fall below the homestead limit. So goes one argument for balancing property taxes with something else.

I recall county commissions two decades ago trying to right that ship. They weren’t happy that exemptions continued to get some property owners off the hook while others carried the extra burden.

That’s how we ended up with countywide fees called MSBUs (Municipal Services Benefit Unit). We pay an MSBU for fire rescue, landfill, and stormwater. These flat fees are unrelated to property values, and instead are tiered based on building size and/or usage.

Some commissioners would like to tip more services into an MSBU. There is a lot of talk about creating MSBUs in neighborhoods for street resurfacing. 

The idea of an MSBU is that there are few exemptions. Homestead doesn’t come into play on an MSBU. 

Finally, one more thing about property taxes. State legislators would have you believe there’s a revolution rising from citizens about these exorbitant taxes, and that those cries are falling on deaf ears with local politicians.

Take a look at today’s photo. That’s from last year’s County Commission budget hearing. I’m telling ya, we’re not cramming the commission chambers with folks griping about property taxes. I’m not suggesting we’re all thrilled paying property taxes. I’m suggesting state politicians know how to rile people up.
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Should Florida become the first state in the U.S. to abolish property taxes? Darned if I know. I do know this: Nothing is free and if these taxes go away, others are coming behind them.

Have a wonderful Monday, friends.

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