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Tax break for seniors set for ballot

In his Miami office, state Sen. Mario Diaz-Balart keeps a list of the elderly people who have come to him saying they can't afford to pay their property taxes.

Come November, Florida voters will get a chance to help them and other low-income seniors struggling to hang on to their homes.

After three years of effort by Diaz-Balart and boosters statewide, legislators on Wednesday approved a resolution to seek a constitutional amendment to allow an extra property tax break for those over 65 who make less than $20,000 a year.

Under the "Save Our Seniors" resolution, cities and counties could create an additional exemption of up to $25,000, on top of the existing homestead exemption, which removes the first $25,000 of assessed value from taxation for qualified homeowners.

The extra exemption will allow low-income seniors "to live the rest of their lives in a home that they purchased and that they worked so hard to keep," said Diaz-Balart.

Sen. Charlie Crist, R-St. Petersburg, a co-sponsor of the resolution, said people "ought not be taxed out of house and home. We should never as a government tax them out of the American dream."

The Senate approved the resolution by a 34-5 vote; the House approved it last week by a 113-2 vote. It does not require the governor's approval and goes straight to the ballot.

This latest ballot initiative comes on top of 1992's Save Our Homes amendment, which prevents county property appraisers from increasing the assessed value of homes by more than 3 percent per year or the consumer price index, whichever is less. It, too, was aimed at helping people who were being forced out of their homes by escalating home values.

The Save Our Seniors tax break, however, will require a three-step process.

First, voters would have to approve the constitutional amendment.

Then the Legislature would have to pass a law that would allow for the additional homestead exemption.

Last, cities and counties would have to adopt ordinances permitting the additional exemption. They could pick any figure they want, as long as they didn't exceed $25,000. "It's total flexibility," Diaz-Balart said.

The local governments could periodically adjust the income limitation required for the exemption _ $20,000 _ to reflect changes in cost of living.

School boards, water management districts and other taxing authorities could not approve the additional exemptions _ only city and county governments could do so. That could make eligible taxpayers' property tax bills even more complicated.

If St. Petersburg approved the extra $25,000 break, for instance, a low-income senior homeowner might see a $75,000 home have a taxable value of $50,000 for school taxes but only $25,000 for city taxes. That's because the owner would qualify for only one homestead exemption on school taxes and two exemptions on city taxes.

Still, Diaz-Balart said he worked hard to try to avoid confusion and legal problems. For example, he didn't want to include school boards because of a constitutional provision that Florida must provide for a "uniform system of free public schools." Cutting school taxes for some taxpayers in one county but not another could go against that provision.

Still, a legislative analysis points out other potential problems: An increased exemption for one class of people, such as seniors, could be challenged as a violation of equal protection clauses in the state and federal constitutions.

However, both the U.S. and Florida Supreme Courts have upheld disparities in tax exemptions as long as there is a "rational basis" for selecting a particular class, the analysis states. For example, the Florida Supreme Court has upheld the constitutionality of a $500 homestead tax exemption for widows. Some disabled people can even get a full exemption from property taxes.

Four other states have special exemptions in various forms for seniors: Delaware, Virginia, New York and Utah.

Critics say the exemption will hurt counties that will lose tax revenues used for services. The legislative analysis says the losses will vary, depending on the county's population of seniors who own homes and the millage rates. In all, state economists estimated the total loss of revenue to local governments would be $91.2-million in 2000-01, but Crist said that would happen only if every city and county approved the additional exemption.

How the new exemption will be received by local governments remains to be seen.

For instance, the Pinellas County Property Appraiser's Office has opposed the additional tax break in previous years when the Legislature debated it.

Some of its concerns dealt with the administrative problems the measure would create, such as having to collect income and age information from people applying for the added homestead exemption.

If approved by local officials, the amendment also could take many homes owned by seniors completely off the tax roll, said Pam Dubov, chief deputy property appraiser.

Dubov said that the property appraiser's office is concerned that the exemption would create several inequities. Other poor people who are younger than 65 need the financial help just as much, as well as do many low-income families, Dubov said.

"Whenever we grant exemptions for one group, others have to pick up the slack," she said.

_ Times staff writer Joe Newman contributed to this report

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