News Article

Attached are a few articles from around the state. Two indicate that a court challenge may invalidate save our homes because of the portability provision of Amendment 1. Several other articles are indicating the session will hold more cuts and (I did not include all of these articles several have run in Florida today) and some are indicating they will hold the line to see what happens.

Well a bill has just been filed that expands the tax cutting but its big selling point suggests it will protect save our homes by adding additional savings to new home buyers. The supporters of this bill will try to sell it as a win win bill that helps the new tax payer and protects the long time home owners. The big problem is it will further reduce the tax collections for local government. This will open the door for the Speaker of the House to sell the added sales tax.

TALLAHASSEE, Fla. -- A lawyer for three new Florida homeowners has filed a lawsuit in state court challenging the portability portion of the Save Our Homes Amendment.

The plaintiffs, homeowners in Tallahassee, Port Charlotte and North Palm Beach, are also seeking tax refunds for themselves and other recent home buyers, which could cost local governments and school districts billions of dollars.

Save Our Homes caps annual assessment increases at 3 percent for primary homes, or homesteads. That means the plaintiffs and other recent home buyers are paying much higher taxes than longtime residents with homes of the same or similar value.

The amended lawsuit alleges Amendment 1, which voters adopted Jan. 29, increases the disparity through a 'portability' provision that lets homesteaders take their Save Our Homes benefits with them when they move.

A state judge in Tallahassee last year dismissed a similar lawsuit by out-of-state owners of second homes in Florida that challenged Save Our Homes on grounds that it violates anti-discrimination provisions of the U.S. Constitution. An appeal is pending.

Gov. Charlie Crist, who touted the plan, said Wednesday he was confident the new tax-cutting proposal will withstand a legal challenge. 'Part of my confidence is based on the fact that Save Our Homes has been in existence since 1992,' Crist said. He said Amendment 1 is 'an extension of that.'

The ink hasn't dried on the Amendment 1 property-tax plan overwhelmingly approved by voters last month, but lawyers in Tallahassee are already taking a key piece of the plan to court.

Their argument is a familiar one: the Save Our Homes tax break -- which caps assessment increases at 3 percent a year for homesteaded property -- benefits longtime homeowners over newer ones.

"Everybody who ever looked at this knows we did not solve the problem," Rep. David Simmons, R- Maitland, told the state's Taxation and Budget Reform Commission on Wednesday.

In a class-action suit filed on behalf of three recent homebuyers in Palm Beach, Charlotte and Leon counties, their lawyers argue Amendment 1 makes the Save Our Homes disparity worse by letting longtime homeowners take their built-up tax benefits with them when they move.

The concept, called "portability," would let anyone who has built up tax savings by staying in the same primary home transfer the discount to a newer home.

But it also locks newer homeowners into always paying a larger tax bill than longtime homesteaders with similarly valued residences.

"It gives you this competitive advantage in perpetuity," said Doug Lyons, one of the lawyers mounting the challenge. "You who planted the flag first get to carry the flag to whatever house you buy."

The same legal team unsuccessfully challenged Save Our Homes in court last year. The lawyers are now asking a Leon County judge to block Florida counties from implementing the portability piece of Amendment 1.

The local-government defendants have until March 3 to respond, and Lyons said he expects the judge to hold a hearing later that month.

"We want to put it on a fast track so people aren't sitting there not knowing what their rights are," he said.

A few lawmakers and tax lawyers warned all last year that "portability" would wind up in a courtroom. Their ultimate fear was that the state could find itself owing billions of dollars if a court were to toss out the entire Save Our Homes Amendment, which has been in effect since 1994.

Simmons, one of the Amendment 1 critics, urged the Tax and Budget Reform panel to consider a potential solution later this month: a "super" exemption worth 25 percent of the value of any property, including commercial buildings and second homes. Revenue lost because of the higher exemption could be offset by a higher sales tax.

Dozens of such ideas aimed at leveling the tax landscape by giving a bigger benefit to newer homeowners were debated by the Legislature last year and ultimately discarded as too complex to explain to voters.

The result, Simmons said, is a potentially illegal portability plan on the books and a bigger homestead exemption -- worth about $15,000 -- that "was wasted on people who didn't need it."

But the panel and key lawmakers who negotiated Amendment 1 are doubtful any changes will be approved.

Allan Bense, chairman of the panel and a former House speaker, said the 25 percent homestead-exemption plan "has some good merit" but said will be hard for it to garner the 17 votes necessary from the 25-member commission to put it on the November ballot.

Gov. Charlie Crist has said repeatedly throughout his campaign for Amendment 1 that portability would withstand a legal challenge.

Meanwhile, county property appraisers are assuming that portability will take effect, and lawmakers are preparing the actual language they must approve this spring to spell out the specific details of how portability would work.

"Right now, the Senate leadership believes we should not be doing additional cutting until we see the results of what we've just done," said Senate Democratic Leader Steve Geller, a Cooper City lawmaker who was in the middle of last year's tax debate.

Linda Kleindienst in the Tallahassee bureau contributed to this report. Aaron Deslatte can be reached at adeslatte@orlandosentinel.com or 850-222-5564.

Tax cutting is back on the agenda in the Florida House, less than a month after voters overwhelmingly approved Amendment 1 and its promise of a five-year, $9.3 billion property tax break.

The House Committee on State Affairs made good on a promise Wednesday to expand Amendment 1, giving tentative approval to a host of proposals that lawmakers dropped from the plan when they reached a compromise in October. Just how far the measures will go in a less-than-enthusiastic Senate remains to be seen, however.

The committee voted unanimously Wednesday to add a key feature, one that would give new home buyers a 40 percent assessment break and one that the sponsor said would go a long way to neutralizing a court challenge that is already awaiting Amendment 1.

The Legislature's own legal experts warned that Amendment 1's 'portability' provision allowing homeowners to take their Save Our Homes assessment cap savings with them when they move, makes it vulnerable in court. That's because it further tilts the state's property tax scheme in favor of long-term homeowners and against out-of-state and new home buyers who pay more.

'There is a serious question about the constitutionality of Amendment 1,' said the measure's sponsor, Rep. David Simmons, R-Maitland.

Another measure the committee approved Wednesday would target tax breaks for waterfront hotels and restaurants. It also would make property appraisers responsible for the legal bills of property owners if a court rules against them in an assessment challenge.

Senate President Ken Pruitt, R-Port St. Lucie, has shown little enthusiasm for sweeping new tax-cutting proposals, and Simmons acknowledged that there is no Senate companion measure.

'I have every expectation that this will pass and that this will pass the House,' he said.

Mark Pudlow, a spokesman for the Florida Education Association, one of Amendment 1's biggest opponents, noted that the fiscal impact of Simmons' proposal, which would exempt school taxes, has yet to be determined.

Property owners need tax relief, Pudlow said, but lawmakers need to take into account the fallout from their rush to cut taxes.

'That doesn't make sense to me,' he said. 'It almost seems amazing that we're going down this path.'