Client News
Palm Beach Post: Legislature’s squeeze on counties comes at a price
Tuesday, September 13, 2011
By Carol Weissert
Posted: 7:38 p.m. Monday, Sept. 12, 2011
Nothing comes without a price. This certainly holds true for state mandates on Florida property taxes. It’s no news that the people of Florida are struggling or that the housing market is far from recovered. But Florida’s many local governments are feeling the strain as well, and cuts in property tax revenues aren’t helping the situation.
According to The LeRoy Collins Institute’s most recent report, “The Double Whammy Facing Florida’s Counties,” county governments are having a very difficult time handling state mandates coupled with the down economy. In the past two years, county revenues have fallen on average more than $100 per resident – by far the largest reduction in over three decades. Losses in county revenue generally translate to cuts to local services.
“The Double Whammy” analyzes Florida county spending and revenue trends over the past 33 years. The report finds that until 2008, Florida’s counties were able to handle economic downturns and effects of state mandates because revenue trends continued to climb. However, as the report shows, on average county revenues fell by $60 per capita in 2008 and by $53 per capita in 2009. The data do not cover 2010, but there has been little good news on the economic front and little reason to expect an upturn in revenues.
The “Double Whammy” highlights several additional county spending and revenue trends:
- Per capita public safety increases have far outpaced the growth of other county expenditures in the past two decades. However, in the past year public safety spending fell slightly, from $442 per capita in 2008 to $440 in 2009.
- Road and street spending has fallen noticeably in the past two years – from $250 per capita in 2007 to $194 in 2009.
According to our report, the property tax is the most relied-upon source for revenues in Florida’s counties, representing 55 percent of average revenue in 2009. When Amendment 1 was approved in 2008, this doubled the homestead exemption and – no surprise – constrained county revenues.
State legislators have put Amendment 4 on the November 2012 ballot. It would again lower property tax levies, by extending the Save Our Homes-style caps on non-residential tax assessments and reducing property taxes for those buying a house for the first time.
While these may be appealing tax cuts for citizens and for state legislators taking credit for taxes they don’t collect, the effect on counties may be more of a fiscal piling on. County officials are in for a bumpy ride – if the past three years haven’t done enough damage.
Dr. Carol Weissert is director of The LeRoy Collins Institute and professor of political science at Florida State University. The institute’s new report can be found at http://collinsinstitute.fsu.edu/