Gov't spending: Get involved and ask questions

ORMOND BEACH -- Volusia County Property Tax Alcoholics Anonymous usually open their dialogue with the following epithet: "Only when you acknowledge you have a problem, can you devise a solution." 

Taxing authorities have an awesome power and it is incumbent upon them to understand that power and use it wisely.

We encourage our elected officials to do their homework before proposing more corrosive tax hikes that lead us into stagflation. During debates with the School District over a proposed hike in the already sky high millage rate in Volusia last October the School Board tried to make the dubious argument that we should have higher millage than other Counties to balance the fact our property values are lower than other counties.

They've failed to connect the low property values to the real cause which is lack of jobs, falling enrollment and a serious lag behind the recovery going on in the rest of the state.

Having the second highest millage rate in the State creates a problem attracting business and jobs. No buyers means no sales and lower values.

Then last week at the County Council retreat, Councilwoman Deb Denys brought up the high millage dilemma and was rebuked by another councilman who said looking at the millage rate is misleading.

In other words, millage rates don't matter. It's the property tax per capita that matters and Volusia ranks 21st in that category. Now, it's clear I hear this sort of talk from our taxing authorities some tax education is in order.

The per capita tax revenue is totally irrelevant to a company considering relocating to Florida from another state. They look at what their cost of doing business is going to be and taxes are a very big portion of that bottom line expense.

The reason we are 21st in this irrelevant category goes back once again to low property values and the fact so many properties are paying little or nothing to the tax assessor.

Those properties assessed at $150,000 and up by the tax assessor are primarily businesses and a few high end homes and they pay 60 % of any new millage hike. Our property tax has become progressive and has shifted to business, thanks in part to Save Our Homes.

Progressive taxation always self destructs as it gradually migrates to a narrowing tax base at the upper end of the income scale. Instead of broadening the base and lowering rates, we have done just the opposite with predictable results.

In 2009 at the County Council budget hearings, I held up two phone books for years 2008 and 2009,  to show the visible decline in the thickness of the books. Approximately 4,000 occupational licenses were not renewed that year. Another 1,000 disappeared the following year. That's 5,000 companies in two years that left the tax base or scaled back significantly. That was a good part of our tax base in Volusia County.

In 2009 at the County Council budget hearings, I held up two phone books for years 2008 and 2009,  to show the visible decline in the thickness of the books. Approximately 4,000 occupational licenses were not renewed that year. Another 1,000 disappeared the following year. That's 5,000 companies in two years that left the tax base or scaled back significantly. That was a good part of our tax base in Volusia County.

They have not been replaced despite the fact Florida is gaining population again partly as a result of Gov. Scotts' pro growth policies and balanced budget.

We predicted at that hearing that Volusia would be the last County to recover unless we recognized the corrosive effect of our high property tax.

My wife and I retired here in 2001, and have enjoyed the small town ambience the climate and close proximity to beaches and boating since then.

We calculated if we had bought a house of the same price in Sarasota, we would have saved over $100,000 in property tax on our home vs. what we've paid here in the past 18 years: $140,000 if we'd chosen Naples and $64,000 if we'd stayed where we were in Seminole County next door. These are real dollars out of our retirement portfolio.

We have no idea what the average resident pays or where that ranks against other counties, but it's completely irrelevant to us. If we are forced to sell, the value of the property will also be diminished by these high tax rates.

As California discovered by its taxpayer revolt in 1978, the sensible solution is lower the high millage rates so property values can be released by market forces. Revenue went up in California for 30 straight years once the taxpayers passed Prop 13, which lowered millage statewide to ten mils or 1% of assessed value.

Last year, a straw poll revealed Prop 13 still enjoys widespread support by an even larger margin than it originally passed by after 35 years.

The purpose of taxation is to raise revenue not raise tax rates. Replacing all or most of the property tax with sales tax would immediately stimulate the economy and cause property values to soar; this time permanently and not in an artificial bubble.

The purpose of taxation is to raise revenue not raise tax rates. Replacing all or most of the property tax with sales tax would immediately stimulate the economy and cause property values to soar; this time permanently and not in an artificial bubble.

Proposals to do just that are again being floated in Tallahassee backed by State Reps. Dave Hood and Charles Van Zant. Contact them to find out how you can help and let them know you support this reform of a broken system.

Don't be swayed by political doublespeak. Get involved and ask questions.

Headline Surfer is the Award-Winning 24/7 Internet Newspaper Serving Greater Daytona Beach accessed via HeadlineSurfer.com (aka NSBNews.net and VolusiaNews.net).

 

 

Ed Connor Picture

Short Bio

Ed Connor is a board member of the Volusia Tax Reform and of the Florida Taxpayers Union. He is a 1964 graduate of the University of Calif. (Berkeley) in Civil Engineering. He retired to Ormond Beach after a successful international career in design and construction of major golf course projects. He and his wife, Pam have lived in Volusia County since 1989.