In defense of Save Our Homes: It protects property owners
For those who believe SOH is the problem: I understand where you are coming from but disagree that SOH is the problem. Although I agree any exemption such as paraplegic, veterans, widows, homestead, SOH or any of the 27 exemptions on the books is not fair to those who do not have any of these exemptions, and they do create inequities, I will argue as the author of SOH that the inequity it created was far less egregious than the inequity SOH solved.
Starting in 1980 and over the next 12 years, we averaged 12 percent annual inflation of values which is 144 percent not compounded based on what those who moved into our neighborhoods were willing to pay when they migrated to or within Lee County. Before SOH (1995) that meant each year everybody’s values (ergo taxes when the millage is applied) were based on those sale prices even though someone may have paid $20,000 in the 60’s or $40,000 in the 70’s, all the way up to $700,000 and $80,000 in this century (for basically the same house in the same neighborhood) causing everyone’s value to be based on those annual sales which was the law before SOH. People were literally being taxed out of their primary residence which is typically the largest asset a family has. That is unfair. When someone establishes their homestead and SOH, that becomes their base year value and those buyers know what the taxes will be and each subsequent year if someone pays 10 percent more or as in Cape Coral on average 50 percent more which happened in ’05, those and all other Homesteaders will be limited to a 3 percent taxable increase. Which in my opinion in drafting SOH, is fair as we were not paying those inflated prices and should not be penalized for what someone else is willing to pay.
Here comes one of the problems: Whenever the voters change the Constitution, then the legislature writes implementing language and finally the State Department that oversees that portion of the Statutes writes the Rules of how to implement the new law. In Florida, that department is the Department of Revenue (there is a reason they are called the Department of Revenue). Their goal is to raise as much money for government as possible. In 1992 the voters voted in SOH. In 1994 the legislature wrote the implementing language and then DOR wrote the “Recapture Rule” and in so doing interpreted my intention that in any year the market value decreases and any homesteaded property that is under SOH and has value that is capped, the appraisers in Florida MUST recapture 3 percent or the CPI whichever is less – this year the CPI is .01percent. I fought that interpretation before an Administrative Judge and lost – then I was able to argue the issue before the Governor (Chiles) and Cabinet and lost there as well. (By the way, the Executive Director of the Department of Revenue is appointed by the Governor and Cabinet.) I do not believe an unelected official should be able to interpret another’s intent, but that is what happened. The last two years, Rep. Thompson and Senator Bennett have put in legislature to do away with the recapture rule but have not, as yet, been successful.
This office is responsible for the values and if you have a problem with the value we have placed on your property, you need to call or come into the office so that we can explain how we arrived at your value. If you can show that we have overvalued your property as to what it was worth on Jan.1, 2009 using the market activity in your neighborhood with ’08 sales, we can make an adjustment. If after talking with our office we cannot agree to a reduction then you can file a Value Adjustment Board petition to be heard before an independent appraiser from private industry for a $15 filing fee. I do not know of another government office that affords that much accountability. You might want to attend the public hearings listed on your TRIM Notice as to the time, date and place where each taxing authority that set a millage against your property will adopt their final millage rate (they can lower it but cannot raise it.) They and they alone set your taxes by lowering, raising or leaving the millage the same. The law requires our office to follow the Constitution, Laws of Florida and DOR Rules in valuing property. I know of no law that requires any of the 92 taxing authorities in Lee County (more than any county in Florida) who have the authority to set a millage rate to raise the rate in these financial stressful times.
It is interesting to me that those very taxing authorities never seem to have a problem in leaving the millage the same when the values were escalating astronomically and creating the perception that they didn’t raise taxes because they didn’t raise the millage which I call the biggest lie in government. Now in these trying times if they left the millage the same (as the City of Bonita Springs and the county did), they could honestly say they lowered taxes; yet the City of Cape Coral has proposed to raise its millage 85 percent. That is for them to defend, not me. If we have another year this year like the last two years, there will be no SOH Cap left. This year 44,000 homesteads had any cap to recapture out of 155,000. Next year I expect that to go to zero as when the market value reaches the capped value, they will then go down together. When the markets return to double digit inflation (which history proves they will), homesteaders in Florida will be limited to the 3 percent cap (which is fair) so that the value you are paying on will not double when others move into your neighborhood and pay twice what you would be valued at under SOH. I know this is not what you wanted to hear, but I am being honest and up front with you.
If we did away with SOH, homesteaders’ taxes would go up to the level of all others and the others would not go down as the only difference would be that government would have that much more money to spend. The proof is they never, ever or rarely lower the millage.
– Ken Wilkinson, CFA
Lee County Property Appraiser
Author, Save Our Homes