I have been trying to make a decision on what we should do about property taxes.
Sun-Sentinel's Paul Owers reported on Feb. 15, 2007:
"Last spring, Palm Beach County Property Appraiser Gary Nikolits said the local housing market would be "brought to its knees" if the property tax system doesn't change. Some would say that prediction came true." and he reported further:
"Realtor associations in Broward and Palm Beach counties are suggesting tax revenue caps for local governments."
The Realtors seem to be on to something. Unless someone educates me otherwise - I like their solution very much.
I also like portability which is allowing homesteaded owners to move their sheltered "Save Our Homes" value from one primary residence to the next one in the same county. Save Our Homes caps property tax increases to 3% per year. Don't know if it is good for everyone but it sure would be good for me (and others with a homestead exemption who have been in their homes for at least 3 years).
I found two recent articles on the Tax Policy Blog worth a look: Tax Cut? More Like Tax Swap Sample: "...the government is not cutting the overall tax burden. Rather it is merely lowering property taxes and raising other taxes, like sales, income, or taxes on businesses which they view as an easier sell politically" and Florida Latest State Proposing Property Tax Cuts for Sales Tax Increase Swap Sample: "Be careful taxpayers of Florida, if you get the property tax cuts you've been clamoring for you could still ultimately end up with a significant tax hike."
This Tax Foundation website has some interesting charts and they explain things very well, for example here is one of their explanations - "What Does Median Household Income Really Mean?" (be forewarned, the answer sounds like a complicated math problem but I could understand it so you probably can too):
How could it be that the two largest groups, households with one earner and households with two or more earners, both saw their incomes grow faster than the overall household median? It is largely because the percentage of households in the one-earner and no-earner groups, where income is traditionally lower, has risen from 54.6 percent to 58 percent. "This increasing ratio of zero- and one-earner households to two-or-more earner households pushes down the overall median.
To make this phenomenon clear, let’s look at a hypothetical example. Suppose we have 5 people in an economy: Homer, Ned, Edna, Marge, and Maude, all of whom work and are unmarried. Homer earns $20,000; Ned earns $30,000; Edna earns $40,000; Marge earns $50,000, and Maude earns $60,000. The median household income would be $40,000 (Edna is the middle value).
But now suppose Homer and Marge get married and Ned and Maude get married. We now have only three households: (1) Edna by herself at $40,000, (2) Homer and Marge making $70,000 in household income, and (3) Ned and Maude making $90,000. Now the median household income is $70,000. No individual person’s income has changed, but we have a higher median income. We would never say that the economy is improving in this situation although median household income is rising.
If Homer and Marge divorce, we will have four households earning incomes of $40,000, $20,000, $50,000, and $90,000. The median has now fallen from $70,000 to $45,000. Again, we would never say that the economy is faltering in this situation although median household income has fallen.
When we analyze household-level data that combines different types of households, we must take into account changing household structures. Shifts in the number of household earners can significantly impact median household statistics, and failure to take this into account can create a distorted picture of income distribution."
Now that was easy wasn't it? Fooled you.
7 comments:
I’m not sure moving the source of income from property taxes to sales tax is a valid solution to the high tax problem. Without some sort of control over escalating spending by municipal government they will continue to spend more and more. Take Miami-Dade’s budget. From actual 04-05 budget of $3,698,513,000 to budget 05-06 of $4,128,820,000 is a jump of $430,307,000 or around 12%. Budget 06-07 went to $4,731,560,000 an increase of $602,740,000 or 15%. (Source - page 404 of volume II Miami-Dade budget) Miami-Dade will also increase the number of employees from 05-06 at 29973 to 06-07 at 30707, 734 positions. (Page 387 same document)
According to the Keys community papers Monroe County needs to go on a spending reduction program, they don’t have the money to cover the full budget. The counties have gone on a spending spree, fueled in part by the double digit inflated real estate prices. Remember that only homestead property is protected by the amendment 10 cap on the property appraisal.
No matter how we pay for government relief will not come unless runaway spending is controlled. What will the possible reduction in appraised property values do the forecasted property tax projections. Only time will tell.
So you agree with Me and the Realtors in Broward and Palm Beach.
I am getting to like you REPEAL, you have your fingers on more numbers than I do!
If you want to read more on this subject, cut and paste this link:
http://newsfeedresearcher.com/data/articles_b8/idb2007.02.22.12.21.59.html#hdng0
Apparently it is of little interest...
No matter where the money comes from, sales tax, property tax or any other tax, spending by county government needs to be brought under control. Miami-Dade government keeps growing faster and faster
BTY - For anyones reading pleasure the Miami-Dade 07 budget is at http://www.miamidade.gov/budget/
Cities and counties must cut spending. No other option works.
Easy to say cut spending. But when you have elderly that need services, children in danger, gangs on the streets, someone has to be paid to do the work of caring for issues. When you cut services, you end up with things not being maintained and you have greater expenses to repair and/or replace.
What we need is to stop allowing the contractors to triple the costs of services. Why spend 100.00 for a lite bulb, when you can go to Home Depot and get it for 5.oo? We need common sense.
I’m not suggesting that Miami-Dade County cut services. My real concern is that the government is too big with too much on its plate for the commission to manage. Miami-Dade county government is really 2 entities rolled into one. I am also concerned that the strong mayor can manage also, time will tell on this one. County wide functions consist of big ticket items like the Airport, seaport, public works, water and sewer to name a few. The other entity is UMSA, the municipal services function for the unincorporated portion of the county. Unlike many other counties the unincorporated area of Miami-Dade is heavily urban, very much a city in itself.
Where has all the scandal been? I would say more in the county wide areas than in the municipal services function. The big ones that come to mind are runaway overruns at the airport, a seaport that looses money where the one in Borward county makes a profit, mismanagement in water and sewer involving paving, striping, cell phones and postage, paying 100% in advance to built housing without any oversight. I could go on and on. The problem is way too much without proper oversight.
With a $ 4,731,598,000, that’s almost 5 BILLION dollars it’s easy to approve 5 million here 8 million there without even the expenditure being noticed. For example did you know that Miami-Dade fire rescue is establishing of a Marine Operation Bureau and acquiring a fleet of Fire Rescue boats. A 1.41 Million dollar 50-footer and two 36 footers for 1.3 million. With operating costs including 18 positions with ongoing operating costs of 2.4 million. The total cost including building a facility at the port to house all this about 5 Million. Don’t get me wrong all this may be needed but due to it being such a small thing, I only found out about it because the 50 footer was at the boat show. Was this need for this new 5 Million dollar expediter with ongoing operating costs debated in public? Did the Miami Herald report this significant addition to Miami-Dade Fire rescue? No, not from what I can tell by searching for press releases and newspaper articles. Just a small bump in the almost 5 billion budget.
I would propose that Miami-Dade County get out of running the city of UMSA. Get out of the municipal services business and focus on county wide services. Broward County is trying just to do that.
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