In November 1924, fewer people than attended last weekend's Florida-Miami football game made the most fateful decision — and by some measures the worst — since the state tried to secede from the Union. By a vote of 60,640 to 14,386, they amended the Florida Constitution to forbid an income tax.
Eighty-four years later, Florida is one of only seven states that does not tax personal income, and the only one whose legislature does not have even the option.
In 1924, Florida was reveling in a speculative land boom that needed more Yankees to keep going.
"Money goes where it is well treated … does not stay where it is not welcome," said a St. Petersburg Chamber of Commerce campaign ad. Both political parties endorsed the ban, as did this newspaper.
The land boom collapsed anyhow. The Great Depression arrived in Florida three years earlier than anywhere else.
That 1924 referendum remains the fundamental reason why property taxes are stretched beyond what many people see as the breaking point. And it is why the state depends so precariously on sales taxes that have never kept up with Florida's growth and which decline when the housing or tourist markets collapse.
One part of the solution should be obvious: Ask the people to vote again. Frame the issue as an income tax to replace property taxes for schools. It would also put to rest the old issue of wealthy counties versus poor ones. An income tax comparable to North Carolina's would just about do it.
If the voters were to say no, then it would have been their choice. But let it be their choice for once, rather than that of the elite who are oxymoronically known as Florida's leadership. I can't think of any good arguments against letting the people choose, although there are lobbyists who might suggest some.
This is not a new idea. In 1973, the Legislature was in a snarl over property taxes for schools because the Supreme Court had thrown out a hard-fought compromise. When Rep. Paul Danahy, D-Tampa, suggested to a subcommittee that Florida fund the schools with either a personal income tax or higher consumer taxes, the room fell silent and the chairman quickly changed the subject. The subcommittee eventually endorsed his proposal but it went no further.
That fall, a growth conference convened by Gov. Reubin Askew declared a "state of emergency" and recommended, among other things, that Florida tax personal income, repeal the homestead exemption, and stop spending money to attract new residents. Askew rejected the recommendations, which conflicted with his promise to voters in 1971 that the corporate income tax he was asking them to approve was not a stalking horse for taxing personal income.
Askew's corporate profits tax, the issue on which he had won his election in 1970, was also Florida's last true tax reform, in the sense that reform means taxing the rich at least as much as the poor. Florida is still the second-worst state in that regard, with poor people paying up to four times as much of their household dollars in taxes as the wealthiest.
The tax on advertising and other services that the Legislature enacted in 1987 would have eased the inequity but it was swiftly repealed after six months under heavy pressure from the media and other special interests.
With the Taxation and Budget Reform Commission's Amendment 5 knocked off this year's ballot, there's nothing in sight to make the Legislature revisit the services tax issue. Martha Barnett, a commission member who voted for Amendment 5, says that "with the wisdom of hindsight," she wishes she had asked the commission to consider a personal income tax referendum as well.
"I do not think it would have passed," said Barnett, the prominent Tallahassee lawyer-lobbyist who had raised the income-tax issue as a member of the 1988 tax commission and of the 1998 Constitution Revision Commission. "But I do think the discussion and debate would have informed the members of the commission and hopefully the public, and that it would have moved the ball forward. I believe that Florida will one day lift the constitutional ban on a personal income tax, but it will likely be in response to a crisis."
Florida never lacks for a crisis. The missing ingredient has been a charismatic candidate for governor who would take tax reform to the people as Askew did in 1970.
Chief Financial Officer Alex Sink, how about you?
Martin Dyckman, a retired St. Petersburg Times associate editor, is author of A Most Disorderly Court: Scandal and Reform in the Florida Judiciary.