Category Archives: Other

FOR WHOM DO YOU PULL THE LEVER

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When we go to the polls, we make choices. The hardest ones are not about whether a Democrat or a Republican is the better choice. To me, the most perplexing votes are when I am asked to choose between a candidate that has government experience and one that does not.

 

How much does experience matter in elective office? I think it depends on what type of position we are voting to elect. Like any new job, once elected there is a learning curve if you have never worked or served in government before. Government does not operate as the private sector does.

 

Government shouldn’t work as a private business because public money is being expended. There needs to be more safeguards and more hoops to jump through. Bureaucracy is created to do just that.

 

I am more than willing to vote for an inexperienced person to represent me in local government or in the state legislature. Most people who initially run for these positions have the best interests of their communities as their reasons for running. There are seasoned staff employees to explain the intricacies of government to them once elected.

 

I am quite leery of voting for someone with no public track record for an executive office. There is a big difference between “shaking things up” and destroying the system, and knowing the difference is much harder for a neophyte.

 

You need to have the ability to do two things in an executive position.The first is to be able to take advice. The elected executive must be a confident enough leader to surround himself with the very best people he can find. The second is to know your own strengths and weaknesses. Any individual that has been successful has an ego. You need to know how to keep it in check.

 

The last type of elected official is the technical position such as Clerk of the Court, Tax Collector, Sheriff or Property Appraiser. In most places, these positions are not elected ones. Except for sheriff, these are departments within other governments. Those department heads are appointed. They are apolitical and technocratic.

 

Florida has a long tradition of electing these officials. We also had a long tradition of electing our school superintendents. Other places elect chief executives to run local government. We don’t do that here. Is one way better than the other?

 

For those technical offices, the person I vote for must have experience in the field. By running, they are applying for a job and I am one of the deciders on whom to hire. These positions are important. I don’t want my sheriff to be the guy that was an accountant before he was elected.

 

If we are going to insist that we choose a person to run a technical department of government by popular vote, we need to look at his/her resume. You need to have both relevant technical knowledge as well as executive experience. If you make the campaign a popularity contest instead of a job interview, you may not get the best person in that job.

 

Depending on the position, a voter can take different factors into consideration. For county commission, experience isn’t as important as judgement. A connection with the voter is important. A county commissioner or a state senator is a representative of the people that elected him.

 

A sheriff or other constitutional officers are technocrats that enforce existing statutes. They need to have executive experience and knowledge in the field we are entrusting them with overseeing. Electing someone without those attributes is bad public policy and ultimately bad for the taxpayer.

 

OPUS….PREVIEW FROM THIS WEEK’S FRIENDS & NEIGHBORS!!!

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In the last newsletter, I wrote about the tumult in Martin County High School’s OPUS program. The parents and students had rapidly become disillusioned with the program when the new choral director was hired for this school year. Director Kylie Lowe was under internal investigation at the time that the parents and students spoke at the last board meeting. She was subsequently terminated during her one-year probationary period.

If Ms. Lowe was inadequate, it was for the best that she be immediately terminated. It probably means that this year’s seniors will have lost their final year to participate in the program. There is always an adjustment period when programs have new leaders. This seems to be more than that. The District did not perform its due diligence when selecting this person. Parents stated that her only qualification was that she was a graduate of Belmont College and an OPUS alumna. If that is true, when will Martin County begin to see that being born here is not a qualification for having a job here?

 

Local Government & Affordable Housing

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The Stuart City Commission will have a workshop devoted to the topic of housing next week.

 

I hope the Commission does not meander down a predictable path. Will that old chestnut of what to do about affordable housing be brought up? If it is then the entire workshop will be for naught.

 

For some very basic reasons, the City has little it can do to provide more of that type of housing. The physical size of the City is limited. The amount of property available to erect new buildings is minuscule. Florida’s building code, which is a very good one, results in a more expensive product than 20 years ago. The City itself does not have the funds to subsidize rents. While the City’s impact fees can be lessened a bit, those of the County and School Board can add thousands of dollars to the cost of new development.

 

What the City can do is change its zoning and LDRs especially in the urban downtown area and, more broadly, within most of the CRA. One change could be to eliminate new individual townhouses and single-family homes in those areas. That may seem radical to some, but more and more municipalities and states are taking that approach. In the rest of Stuart, all new construction (including for single-family homes) would be required to have an ancillary apartment. There would be no requirement that it be rented. Over time, small units would be available even if only for resident’s children to occupy while starting out.

 

Another change could be to stop basing decisions on the outmoded concept of density. Stuart has setback and height restrictions which guide the overall building measurement within the parcel’s envelope. Counting the number of units that a project can have is senseless. If the code allows a property owner to build 15 units per acre, it currently does not dictate whether those units are studios, one bedroom, or three bedrooms. The density calculation, then, is meaningless. Common sense dictates there will be more people occupying a three-bedroom unit than a one bedroom.

 

Within the downtown area, and the CRA in general, we should stop requiring so many parking spaces per unit. This artificially limits the number of housing units than can be built. The market will determine what amenities are needed to sell or rent a unit. Parking is an amenity. If a buyer or tenant considers it important, then the developer will have that cost and use in his determination of price just as he does granite counter tops or a powder room.

 

There is a misconception in Stuart that there is no affordable housing. If that were true, then why do more than 60% of dwellings within the City pay no real estate tax and only a small fire fee? If an owner pays no tax, then the cost of his property is quite low.

 

Presently, much of the City’s housing stock is considered obsolete. It is old and has lived its useful life. You can buy units for $100,000. This is about as affordable as it gets. It is true those units need work. But mortgages and carrying charges can be $1000.00 a month.

 

Stuart needs to encourage housing period. Supply will quell demand. New units make older units cheaper.

 

There will still be people who will never find units they can afford. This is an American societal problem rather than a Martin County or Stuart problem. The national and state governments need to address this. Localities will never have the funds to build enough units to satisfy this demand.

 

And lastly, the Commission should not be influenced by people who do not live within Stuart’s boundaries. They may have the best intentions, but their input is secondary to that of the people paying taxes, and I do mean paying taxes to the City. There will always be those who will say I can’t find anything to buy or rent within the City. What they really mean to say is that they can’t find a single-family home or apartment with four bedrooms, a pool, new baths, and new kitchen appliances on an acre of property for $275,000 or $1000 per month rent.

 

Our Time

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The year 2019 is nearly finished and has gone racing by!

 

Where does time go? As a child, I remember calculating how old I would be when the year 2000 happened and realizing that I would be nearly 50. As a teenager, I could hardly wait until that 18th birthday that would bring adulthood and college. In my twenties starting out in the business world, it seemed that I had nothing but time since money was at more of a premium. Each year brought new uses for how I would spend my time. I would nod my head when people in their sixties would say that their life had passed as if they had been looking out the window of a speeding car. I thought they were exaggerating. They weren’t.

 

The concept of time becomes more important to us as we grow older. It is something that is at a premium with each year lived. Every second that passes is lost. Many of us “sell” our time professionally.

 

An attorney bills in increments of hours, accounting for every minute at his office. A restaurant sells food but, if they have a slow night with lackluster sales, the restaurant will never sell those “empty” tables again. Each hour is unique even if spent on doing repetitive tasks. We will not again have the moments we used for playing that video game or washing the car.

 

If you choose to spend time going fishing instead of playing golf, then one of your hobbies will suffer and the other you should become better. Is that what happens in relationships? When it is said that two people grew apart, was it because they didn’t spend enough time with each other? Are you then a better parent if you devote more time to being with your children instead of at your job or business?

 

Now that I am on the downward slope of my business career, I am just a few short days away from not owning any business for the first time since I was a college student. How will I fill my day? I will still be doing a little work for the guy who now owns the business (my son), but a large time constraint is gone.

 

With the activities that fill the days for my wife and me, we are still on the go constantly every day. I keep saying when I retire, I will do this or that but, deep in my heart, I know I never will otherwise I would be doing it now. Time is the one thing that is finite for each of us. We will probably not know when our time is up, so to speak.

 

Is it a waste of time to spend so much of it in front of the television, on the golf course or taking that daily nap? If we are doing those things, it isn’t a waste of our time but a decision on how to spend the time. The time we can never recapture or ever use again. What we did with our time is how we are remembered.

THANKSGIVING

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Another Thanksgiving is upon us. This is my absolutely most favorite holiday.

In the last few years, it seems that the Christmas season is beginning around Halloween. Sirius Radio has had holiday music channels for weeks. The Hallmark Channel is in full maudlin Christmas fashion. Each of those repetitious movies has the plot of the books my 2-year-old granddaughter pretends to read. The rush is on, and it seems that I am out of the race.

Ever since I set up shop as an adult, I have hosted Thanksgiving dinner. As the cook, I start preparations a few days before. For years, I would brine the turkey (a step I no longer do), and, for the 24 hours before cooking, the bird air dries in the refrigerator. By allowing the skin to lose some of the moisture, it crisps better.

I always make the usual American-style trimmings…gravy, mashed potatoes, stuffing, squashes, vegetables… but it wouldn’t be Thanksgiving without at least lasagna or manicotti, meatballs, sausages, and other Italian-American dishes. For a while, I would make homemade mozzarella and a few times even burrata.

Over the years, the way I would prepare this dish or that would change. For instance, I learned to make stuffing from my grandmother when I was 14…not in her home kitchen but in a restaurant kitchen where we would serve over 300. We would save the leftover bread for weeks in big paper sacks, no longer allowed by health code regulations. She would soak the bread in chicken stock to soften. She would cook onions, celery, carrots, raisins, and seasoning in butter and sherry in large roasting pans on top of the stove. Mix it all together and bake in the pan. When I graduated to other professional kitchens, I made that same stuffing for years.

Once married to my first wife, who is Puerto Rican, she insisted on adding sausage to the recipe. It became my new standard. My current wife insisted that the sausage had to go and that the bread be replaced by stuffing cubes. Besides the American and Italian food contingents, my Puerto Rican wife would make pernil, arroz con gandules, and other cocina criolla dishes.

For several years between marriages, I hosted Thanksgiving as a bachelor for friends and family. The standard fare remained but other dishes came and went. One year, I had pierogis for Polish friends. Another year, I made a roast goose as a changeup, in addition to the turkey.

When we still had a place up north, our apartment would be where the kids, their spouses, and others would come. A friend of one of our daughters came a few times, accompanied by the most beautiful and interesting women. I definitely missed him when he moved to California.

The last few years, we were away from home on the holiday. Last year, we were with a couple that are long-time friends living in Texas. I cooked some and the host cooked some. It was an Italian, Tex-Mex typical Thanksgiving that was all American.

And maybe that is what we are losing when we relegate Thanksgiving to a pit stop on the way to Christmas. It should be a time when we celebrate what it means to be an American. Over the years I have adopted customs and foods of others in order for all to feel welcomed at the table. Because what we celebrate is the very essence of being an American. That is the true message. It is not about shopping or football. But it is about what we should hold dear. We sit together regardless of where we or our ancestors emigrated from and thank God for living in this country.

 

The Truth About Treasure Coast Classical Academy

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Last week, I visited the campus of Treasure Coast Classical Academy (TCCA) at its temporary site on 34th Street in Palm City.

I was an early supporter of the school, dating back to when it was in its planning stages. There is no doubt in my mind that a school with this curriculum is needed in Martin County. It may not be for every student, but for those parents that believe in this model of education, TCCA is the place to send their children.

A misconception that many have is that it is not a public school. That is not true at all. The way a student gains admission is by filling out an application form online and then the students are selected by a lottery. There are points for siblings of existing students and for those whose parents are working at the school.

I toured several different classrooms, and it appeared the student population was representative of Martin County. There were white kids, black kids, and Hispanic kids. In almost every room, there were special needs children. It wasn’t any different that what you would expect in most school classrooms in the county.

What was not usual was that the kids in the third grade, for example, recited a poem by Maya Angelou and, in another room, the Preamble to the Constitution. They were studying literature and history by learning about the Roman Republic, not from a textbook but by reading original works. Math was tied into reading, even in the earliest grades, by solving word problems.

There is music and art taught every week to every child. P.E. is mandatory for every child in every grade — and they participate. The school is not overly concerned with teaching to state tests though each child will have to take the very same tests as any student in the state.

Like many schools, there is a “uniform” but here it seems the kids are wearing it. Ms. Swearingen, the principal, walks the campus gently asking students to tuck in their polo shirts or thanking them for walking quietly. She has a keen eye as she scans a classroom to see if every student is engaged with the lesson.

In the classroom, there is a desk for every student and the students work together as a class. Since kids are not handpicked, there are classes for those that need extra help just as in any public school. And, that is what the general public needs to understand. Contrary to the propaganda that you may have heard, this is a public school only without the many layers of bureaucracy dictating to the teachers.

Teachers are respected. They have a higher degree of control in preparing their lesson plans than those in the schools controlled by the District. Is this teaching method the best for every kid? No, it isn’t, and that is the point I am trying to convey. Parents and their children should have many different educational formats and options from which to choose.

Perhaps instead of calling these institutions “charters,” they should be known as magnet schools with a specialized curriculum.  Every teacher has the same qualifications as any other Martin County educator. Any Martin County kid can enroll. There is no tuition. Children that attend are not chosen by tests, grades, or geographical area. It is a public school where all are accepted.

As a society, we need to break up the educational monopoly. One size meant to fit every child has not worked. The United States has a broken system that has resulted in some of the worst rankings in the OECD (Organization for Economic Co-operation and Development). Despite Florida’s mania for testing, we continue to have sub-par outcomes.

Education is meant to open the mind to all possibilities. Elementary education doesn’t teach a trade, occupation, or profession. It is to provide the student with the tools to be able to learn those things later. “The purpose of education is to give to the body and to the soul all the beauty and all the perfection of which they are capable.” Plato understood that formulaic dictum would not deliver the desired results.

Treasure Coast Classical Academy is one place that Plato will be studied. Not from a textbook but from reading Plato’s works. Whether the students of that school go on to be attorneys, writers, or welders, they will have learned not what to think but how to think for themselves.

Some in the educational establishment would argue that this is not a “true” public school. To me that argument is one that is more about control of educational dollars than public education. As a parent, grandparent, and citizen, I want to make sure that all children have the tools to be productive.

While I disagree with Mao Zedong about most things, he was correct when he said, “Letting a hundred flowers blossom and a hundred schools of thought contend is the policy for promoting the progress of the arts and the sciences and a flourishing culture in our land.”

 

From The October 13th Friends & Neighbors Newsletter

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THE PELICAN CAFÉ

There is a reason why I am against governments owning property for uses other than their own. The reason for owning property given by municipalities is that by having a rental stream, you can diversify the government’s dependence on ad valorem taxes. The Pelican Café is a prime example of why it doesn’t work.

Instead of looking at it as the business it is supposed to be, it is easy for Commissioners to end up on the wrong side of a public relations campaign. While the current tenant may believe it is his property, it actually belongs to the people of the City of Stuart. Paul Daly trying to renew the lease two years before its expiration is not, as he claims, “the end of the line” if it doesn’t happen now. Unless there is a sale in the lease’s future.

Sometimes, Commissioners want to use these opportunities to ingratiate themselves with the owner of the business. It isn’t their money, so making sound business decisions aren’t foremost. That is the bottom line with government…they don’t care. For elected officials, it is political expediency and for staff it is survival until retirement.

Who will remember that the last Commission gave away a sweetheart deal to George Hart who was the then owner of Mulligan’s? In that lease, the Commission promised him millions if the City ever wants to develop the property. Hart has since sold that lease, along with Mulligan’s, to investors. In that case, the profit is going to them and not the City. Good deal for the taxpayers? I think not.

Politicians believe they need to make everyone happy…that is, everyone but the taxpayer. Maybe, just maybe, there are a few Commissioners that think the taxpayers should get the right deal. The old line in the “Godfather” movies rings so true because it is business and not personal. Would you sell your car or rent your house and not want the most you could obtain?

Paul Daly may be a very nice person. The ten-year lease with two five-year options would be a gift that the City cannot afford. The rent is below market even after receiving 3% of sales. If it went out to bid, I am sure the offers would be better than that. Even if another $1000 per month was offered, that alone would translate to $240,000 additional over 20 years.

By not getting the most that Stuart can, the taxpayers are left holding the bag. No amount of publicity, public relations or talking is justification for taking money out of the pockets of Stuart taxpayers. The Commission and the staff need to maximize the citizens’ investments. Every time someone says it doesn’t matter…it does. There is no public purpose in any of this. The Pelican Café is a money-making business that is banking on getting a sweetheart deal using the citizens’ money.

If you read the current lease and addendum, it states that Daly and the City can continue to renew this lease in 5-year increments beyond 2021. Further, it goes on to state that since the lease was signed before the charter review that mandated a referendum, Mr. Daly could have his renewals without going to a referendum.

The purpose of the referendum that was held was to allow the City to sell the Northpoint property to Geisinger. Mulligan’s was added because they wanted their own lease instead of the assignment from the Spoto lease. Since the City was already going through the expense of a referendum, it made perfect sense to add the Pelican in case Daly did not renew. That is why the language “the property known as” was added.

If the Commission does nothing else, it should make sure the lease and business cannot be transferred to any other person or entity. That way it cannot be sold. Mr. Daly keeps the restaurant and when he retires, it comes back to the true owners, the citizens. I hope there are 3 votes to do what is best for the taxpayers.

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From September 29th Friends & Neighbors Newsletter

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THE OLD COURTHOUSE COMES HOME

 

Since 1989, the County has leased the old Courthouse and Gazebo Park to Stuart. The City turned around and then sub-leased the Courthouse to the Arts Council. No money changed hands from Owner to Tenant or Tenant to Sub-Tenant. The only reason the City ever became involved was because the County wanted to tear down the building. With the termination of the old agreement, that all ends.

 

The County has received a $125,000 from the state for a new roof because the structure is historical. The Arts Council will receive $60,000 per year from the County to manage programs at the courthouse. The City will retain a lease on Gazebo Park, but the County can maintain the trees around the building without paying the City the tree trimming fee.

 

Commissioner Heard could not understand how the Arts Council qualifies for free rent and to receive $60,000 per year. She equated it to the BOCC picking winners and losers. On the surface it sounds that way, but Martin County has decided to be responsible for the building because it is an historical structure. The Arts Council is named in the Comp Plan as the County’s local arts agency.

 

There is absolutely no doubt that there are too many nonprofits being funded by nonprofits and or the government. Duplications and similar organizations abound. Perhaps the Arts Council should be combined as part of the Elliot, House of Refuge, and the Stuart Feed store. There can be a debate that joining all these organizations with one Executive Director and Board would make sense economically. But that is not the question being asked.

 

Just like government provides golf courses and parks, they should provide art and music. The Arts Council does that! So it isn’t, at least in this instance, the County picking a winner. This gives us a well-rounded community. A motion was made by Jenkins and seconded by Hetherington for the proposal. It passed 4-1 with Heard dissenting.

 

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Martin County’s 2020 Budget

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This was written on behalf of the Martin County Taxpayers Association:

For Fiscal Year 2020, Martin County will have a budget of $500 million or $3,125 per resident.

Many of us believe that is an extraordinary amount for local government. Roughly 70% of the total budget comes from property taxes. Because of Florida’s system of property tax exemptions and caps, a disproportionate share is paid by business and nonresident property owners. The rest of the income is from grants, fees, shared, and miscellaneous revenue. Can the Board of County Commissioners do much to curtail expenditures in order to reduce taxes?

The County is charged with providing the funds for the constitutional officers. The Sheriff’s Office is the one department that has the largest budget impact. Their budget, at nearly $71 million, is broken down into three subsections. The largest share is law enforcement with a budget of a little over $48 million, corrections and county jail has a budget of $19 million, and providing security at the courthouse is another $3.5 million.

More than $67 million dollars of that department’s budget is from the general fund. The Sheriff’s budget is presented to the Board of County Commissioners (BOCC) for its nominal approval. They can reject the budget and make changes. However, the Sheriff can then appeal to an administrative commission in Tallahassee. This appeal process is hardly ever used. If there is a dispute in a county, the sheriff and the commission usually come to terms before that step is taken. A commissioner does not want to be the politician that cut the number of deputies patrolling our streets.

The other half of the public safety equation is Fire/Rescue. The BOCC has both full operational and budgetary control over this agency. Fire/Rescue has a budget of $47.7 million. Much of that amount comes from the Municipal Service Taxing Unit (MSTU). The MSTU is paid based on property value and is charged in the unincorporated areas. Some of the rest of their budget amount comes from the general fund. This occurs when the Fire/Rescue Department provides services for every county resident including those within Stuart and other municipalities such as a hazardous material response.

While the BOCC has full control over this agency, they have generally been supportive of its budgetary requests. Several Commissioners have stated that they are very unwilling to second guess the needs of these first responders. When combined with the Sheriff’s budget, it represents 23% of the total County budget.

Most of these funds are spent on personnel. Are there too many EMTs, firefighters or deputies? The Taxpayers Association is not qualified to determine that. Which places us in the same position as the BOCC.

We would urge the BOCC to take a harder look at the employment compensation packages for these departments. We are not aware of a recent compensation study being done for positions in these departments that considers both neighboring jurisdictions and jurisdictions demographically and economically similar to Martin County throughout the state. The compensation study would need to look at things such as volume of calls answered and fires responded to—in other words, the workload of an employee.

Compensation rates should not be based on volume of work but, rather, complexity of tasks, education/certifications, etc.  Volume of work should be addressed by headcount unless it is a piecework environment where production is counted by number of widgets produced in a certain amount of time.  Fewer calls equal fewer people or, if a certain number of people are required for each call, then consolidation of fire houses.

Enterprise funds comprise 27% of the total budget. Enterprise funds are fees and charges for direct services. The airport, solid waste, and water are examples of this. The funds are used to pay and improve the operations of those areas. Things such as wastewater management are usually provided by government to the public.

In some cases, such as trash collection, Martin County has decided to outsource that function to a private subcontractor. Since the County collects payments from individual homeowners on behalf of the subcontractor, residents receive more attractive pricing than if each homeowner paid the subcontractor directly. The County has determined that everyone should have garbage collection rather than relegate trash to pits in county backyards.

As taxpayers, we often make the mistake of analyzing the cost of a function instead of the necessity of providing the function itself. As a body, the BOCC has a hard time knowing whether the widget being bought should cost $1 or $5. Because of that they must rely on the expertise of their staffs. The question to be answered, however, is whether the widget should be purchased at all.

What any elective political body seldom discusses is if it should even be providing the service. For example, why does the County provide Fire/Rescue to every resident in unincorporated Martin County? It is the largest department that is under the direct control of the BOCC. It has an enormous cost. To provide that service to the more rural areas of the County on a per capita basis is very expensive. Then, what is the alternative for those people. Should it be a volunteer response?

Good governance should not only examine the cost but the mission. For every department, a comprehensive review of the need for providing services should be undertaken. Taxpayers would be better served by the BOCC doing that one thing than by trying to determine the cost of the widget.

 

 

TAX EXEMPTIONS

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A third in an occasional series on Florida taxes for the Martin County Taxpayers Assoc. 

How many exemptions are in the Florida property tax system?

 

According to the Martin County Property Appraiser’s website, there are 16. They encompass reasons as varied as being a Florida resident to a limited-income Florida senior or a disabled vet. Government largess at its finest but is it to the detriment of a fair and equitable system of taxation.

 

In the past few years, the number of exemptions has increased exponentially as the legislature has tried to curry favor with the voters. For Tallahassee, this is a way to gain political points as tax cutters but not have to suffer any pain with the loss of tax dollars to state coffers. Real estate taxes are local taxes that are levied by local governments for local needs.

 

The oldest exemption is the “Homestead Exemption,” which dates to 1934. It was meant to shield individuals from losing their property during the Great Depression. It was initially on the first $5000 of property value. It was increased by statute in the 1960s to $10,000 and then, in 1980, was raised to $25,000 by a voter-approved Constitutional Amendment. That amount was increased to $50,000 in 2008 for non-school property taxes.

 

These exemptions are not to be confused with the “Save Our Homes” Amendment that was passed by the voters in 1992 and went into effect in 1995. That amendment states that the year after you receive your Homestead Exemption, your property assessment can only be raised by the lesser amount of 3% per year or the rate of inflation. As an example, if your home was assessed at $100,000 in year one, the most it can increase would be to $103,000 in year two.

 

In 2008 voters approved a Constitutional Amendment that allowed for portability of the “Save Our Homes Amendment” caps to a new home bought anywhere within the state. This allows you to bring an assessment of up to $500,000 with you and have it part of the calculation in figuring the valuation for your new home.

 

Using the Martin County Appraiser’s estimator, I ran several scenarios. One was a Market Value of $100,00 in the old home with an Assessed Value of $90,000. The new property’s sale price was $200,000. After applying the Portability benefits and Homestead Exemptions, the new Taxable Value was $140,000. This is $60,000 less value than a first-time non resident buyer would have for the same property.

 

Real Estate property taxes were not conceived as a progressive tax. They were to be based purely on the value of the property. This concept goes back to antiquity. Real estate tax is known as an “ad valorem” (Latin for as to value) tax. Just as the “wealth tax” now being touted by presidential candidate Elizabeth Warren, the taxable value is to be based on the totality of the asset.

 

Many states, but most significantly Florida, have bastardized that original concept. By allowing for a proliferation of tax exemptions, artificial capping of assessments and, most recently, portability, real estate taxes have now entered the realm of government choosing tax beneficiaries like our chaotic federal income tax system.

 

Florida has a politically complicated real estate tax system that has resulted in an unfair playing field for classes of property owners and local governments that rely on those taxes. A rent control analogy is applicable to the “Florida System” of real estate taxation. Much of the taxes that residential owners will pay are based in how long they have been Florida residents.

 

If you bought a home in 2000 and became a Florida resident, your assessed value is capped using the 2000 market price. Your home may have climbed in value to triple what you paid for it 20 years ago, but that is immaterial to what you will pay because of “Save Our Homes.” The tax you pay is not based on anything more than when you happened to have moved into the home and had declared a homestead. The 2000 value could be a million dollars and your neighbor, who just purchased an exact replica yesterday for 3 million dollars, will pay substantially more in property taxes.

 

The reason given when “Save our Homes” was instituted was for the poor widow who could no longer afford to live in the family home. This, of course, was a similar excuse used when rent control was being instituted. The unintended consequences of this policy are the perversion of the real estate market. Billions of dollars of real estate value are prevented from being taxed because of illiquidity. Governments must compensate these individuals by relying on business and non-homestead properties to pay a greater share of the tax burden than is equitable.

 

The cocooned homesteaded owner has an incentive to demand greater and greater services from local government but not pay his/her fair share for those demanded services. This further increases the expectations on localities with non-taxed or insufficiently taxed voters calling the shots with businesses and non-homestead owners picking up the costs.

 

If this is not corrected at some point, the inequalities will have an adverse effect on the state’s economy. Taxes must be shouldered as equally as possible by all property owners to be fair. The state should not try to place societal goals that are better left to other governmental means on the property tax system. There needs to be a restoration between value of the property and the amount paid by the owner.