Published Thursday, April 24, 2008 at 6:06 p.m.
TALLAHASSEE, Fla. — A proposal that would swap a massive 25 percent property tax cut for potentially
higher and broader sales taxes narrowly kept its place on the November ballot Thursday.
Business interests, school
officials and a couple influential lawmakers urged the state's tax commission to reverse it's prior approval when
the proposal came up for a second and final vote. Three former supporters did switch, but it squeaked by 18-7. That's
one more vote than it needed to get on the ballot.
The Taxation and Budget Reform Commission also affirmed five
other proposed state constitutional amendments previously passed after approving technical changes. None of the other votes,
though, were close.
The tax swap would abolish the portion of property taxes the Legislature requires school districts to collect to qualify for state aid. The measure also would require lawmakers to
hold schools "harmless" by replacing that money - estimated at about $9 billion annually - from other sources.
Another
provision would limit annual increases in property assessments to 5 percent for businesses, second homes and rental units.
Primary homeowners already have a 3 percent cap.
The amendment responds to an outcry for property tax relief at
public hearings the commissioners held across the state even though the Legislature and voters have approved two smaller cuts
in the past year.
"If we don't vote this out, I don't think we'll just disappoint the people,
we'll fail the people," said Commissioner Roberto "Bobby" Martinez, a Miami lawyer and member of the State
Board of Education.
The amendment lists several options for replacing the school dollars including a 1 percentage
point increase in the state's 6 percent sales tax. The others are to cut spending elsewhere, repeal various sales tax
exemptions on such things as bottled water and stadium skyboxes or raise any other revenue.
The last option has
business leaders worried. They say the replacement amount is so big that lawmakers will have little choice but to begin taxing
currently excluded services ranging from lawn mowing to lawyering.
Commissioner Randy Miller, executive vice president
of the Florida Retail Federation, said he also thought it'll be impossible to make up for the lost property taxes no matter what the Legislature does.
"This will starve the beast," said Miller, a former state revenue
director. "This will kill off state government."
The amendment's sponsor, Commissioner John McKay,
a former Florida Senate president, argued the proposal will stimulate economic growth and that would generate new tax revenues
and help offset the cuts.
House Speaker Marco Rubio, R-West Miami, testified in support of McKay's plan last
month, but has since turned against it because of the service tax issue. He also wants to raise the sales tax by 2 percentage
points but he's afraid the amendment will limit the increase to 1 percentage point.
The commission is set to
vote on two more measures Friday in what could be its final meeting for 20 years. One is a previously defeated proposal that
could restore an unconstitutional school voucher program. The other would require school districts to spend 65 percent of
their budgets in the classroom.
The panel also agreed to withdraw a previously adopted measure requiring Florida
to join a group of states working together to collect sales taxes on purchases made through the Internet, catalogues and other
remote means.
The Legislature will take up the issue instead.