Florida Property Taxes - Millage Vs. The People

 I just received my 2010 proposed property taxes notice.  

I have lived in the same house for about 24 years. I am thus protected by the Homestead exemption which should not allow my taxes to be raised more than 3% per year.

The value of my home has been steadily decreasing during the last 3 or 4 years. 

However, my 2010 taxes will go up about 9.4 % in the best case and 14.4% in the worse.

How does this happen? 

a) My "assessed" home value goes up 3% to catch up on past years when I was protected.  When prices went artificially up 20% or 30% some years, they couldn't raise my taxes more than 3% per year, because I was a beneficiary of the homestead regulations. But now, even though prices have been going down every year, they still apply the 3% tax increase every time. Difficult to explain? I confess it is. 

b) The millage. Say your home is worth $100,000 and your taxes are $2,000 per year. Your millage is 2%. Figured it out? The millage is the percentage applied on your home value to calculate your tax. Of course it is on the net assessed value. The assessment is what the County Appraiser establishes as your home value. 

We have certain tax exemptions generally called Homestead which benefit residents' first home, and plus some minor additional benefits for some senior and low income or disadvantaged residents. The Homestead exemption reduces your assessed value by $50,000 for some tax components,  except for the school taxes which have a lesser exemption.

Let's analyze my specific property taxes, as an example.

Reading my 2010 proposed tax bill, (if the budget changes are approved)  I notice:

a) County taxes amount to 22.96% of the dollars total of the tax bill. 

Millage Last Year: 4.8889 - Millage  this year: 5.2256%  - 6.88% Millage  increase 

b) Public School taxes total a 33.61% of the dollars amount of my tax bill. 

Millage Last Year: 7.363% - This Year: 7.631% - 3.64% Millage  increase

c) South Florida Water management taxes amount to 2.16% of the tax bill. 

No changes in Millage rate  -  0.5346 % .

d) Everglades Construction Project taxes amount to 0.362% of the total tax bill. 

No changes in millage rate- 0.0894%

e) Florida Inland navigation taxes amount to 0.1396% of the total tax bill.

No changes in millage rate - 0.0345%

f) Children's Services Council amounts to 1.90% of the total tax bill.

Millage Last Year 0.4243% - Millage this Year 0.4696% - 10.68% Millage increase

g) Municipal (City Taxes) which amount for  31.15% of my total tax bill:

Millage Last Year 6.9934% - Millage This Year - 7.7% - 10.10% Millage increase!

h) South Florida Hospital District, which amounts to 5.90% of my total bill.

Millage Last Year - 1.2732% - Millage This Year 1.4572% - 14.45% Millage increase

i) Non ad-valorem assessments: 1.80% of the total dollars amount of the tax bill.

No change in millage rate.

 

I repeat:  Altogether, my 2010 taxes will go up between 9.4 % in the best case and 14.4% in the worse, depending on the budget discussions.

 *****

Is this fair? When property values have been plummeting  for four years now?

When inflation is close to zero? 

Can people hardly hit by this unending recession afford these increases?

Here is my analysis and my conclusions

The largest impact on my tax bill is by far the MUNICIPAL TAXES  item, followed by BROWARD COUNTY TAXES. Millage rates have increased a lot in one year on both counts.

Public School Taxes had a more moderate increase in the millage rate.

Hospital District Taxes had the highest millage rate increase (14.45% more). However it is only a 5.90% of my tax bill; so the impact is not so bad, and I can understand that in these recession times, hospital could be extending their services to more under-privileged citizens. 

What I can't easily swallow is the County and City tax increases. 

In spite of the present property values drops, the overall tax base (total of assessments for all properties) of my city has substantially increased since 2000. This increase is much higher than the rate of inflation in the same period.  How can be explained?  A couple of words may suffice: waste and mismanagement. 
Do I have actual proof of that? I do not follow these budgets and city commissioners'  decisions and meetings so closely.

On the other hand, services have not improved, and I have seen higher bills for my  sewer, water, trash services; In some cases, these services have been actually reduced.

But like any private corporation, what count for a shareholder at the end of the Business Year are the dividends of his investment.  And a conscious shareholder will compare them against previous years' returns and results, as well as similar corporations' results. According to this judgment, the CEO and Board of Directors will be confirmed or voted out.

Our taxes are a main consideration when assessing our governors' work. It's not quite the same as a corporation, but very similar. We can and should exercise our judgment and make our voices heard. 
It is done once every few years when voting for our commissioners.  

As a realtor, I am severely affected by the impact of property taxes (as well as insurance, maintenance expenses), on people's ability to sustain their home-ownership.  Foreign buyers often balk when confronted with the cost of maintaining a property in Florida. 

No doubt that, unleashed as it seems to be, this is a leading factor in the real estate recession.

This is the bottom line. 

**-**

I have read in The Palm Beach Post – August 27, 2010,  an article on the same subject.  That confirms it. I am not alone. This is what it says:

Home values way down but taxes often up; homeowners ask how it's possible

Many Palm Beach County homeowners may feel like they've been drop-kicked in the gut after opening their preliminary property tax notices this week.

Property values across the county have plummeted, leaving many owners owing more than they paid for their homes.

Even those who aren't under water felt the jolt. In many cases, not only did their property values fall, but they will pay more in property taxes next year.

"I thought to myself, 'How does that happen?' " said Bob Deacy, who is slated to pay about $100 more in property taxes next year for his home in West Palm Beach's historic Flamingo Park neighborhood. "I read it over three times."

The increase came despite a 22 percent drop in his home's market value.

Deacy bought his home $79,000 in 1997 and saw its value rise year after year. But to see it plunge this year from $189,143 to $147,296, is more upsetting than the proposed tax increase, he said.

"I am a realist, and I know that if you want improvements in your community you are going to have to pay," he said. " I didn't think in a neighborhood that is sought-after it would go down as much as it did."

By contrast, suburban Lake Worth resident Erna Altenor also watched her home's value plummet but has seen her tax bill fall. Altenor bought her home for $260,000 in 2007. Its market value is now $73,581, according to her preliminary tax notice.

"I couldn't take it no more," said Altenor, who stopped reading the notice after seeing the new value.

State law prevents homeowners from being taxed on more than their home is worth. As a result, Altenor's taxes have also plummeted to $1,055, down from $2,133 last year.

"That is good news," she said.

For those unhappy with the numbers in their preliminary notices, there is time to challenge them.

The county's value adjustment board can lower a property's assessed value after a hearing before a special magistrate. Petitions can be filed with the Palm Beach County Clerk and Comptroller's office.

And the county, cities, and other agencies won't finalize tax rates until next month. Before they do, they must hold public hearings on their budgets. Those who want to sound off about tax increases can speak out at those hearings.

The dates and locations are included on property owners' preliminary tax notices.

Property taxes rising

Many longtime homeowners will see their property taxes go up this year, even though the values of their homes have fallen. Here's one example:

West Palm Beach Year purchased: 1997

2009 market value $189,134

2010 market value $147,296

2009 property taxes $1,310

2010 proposed property taxes $1,413

Property taxes falling

Homeowners who bought during the boom will likely see property taxes fall this year, along with the values of their homes. Here's one example:

Suburban Lake WorthYear;  purchased: 2007

2009 market value $133,740

2010 market value $73,581

2009 property taxes $2,133

2010 proposed property taxes $1,055 

Henry B. Nathan is a Realtor at United Realty Group Inc.

Visit my websites:

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Don't worry it's just your money!

Throughout this blog, I have always advocated for thrift and good management of taxpayers' dollars by our cities, counties and the state of Florida.

As a real estate agent, I observe every day how excessive taxation has a major effect on home-ownership. At about 2% per year on the value of your home, added to Florida high insurance premiums, (as well as out-of-control condominium fees) it is an overwhelming factor that often discourages buyers.

Property Taxes and routine expenses are often higher than the basic monthly payment of the related mortgage loan.

The generosity with which taxpayers' dollars are spent with no other consideration than "if it's there we must get it", is far out of the traditional values of thrift and austerity that should be the norm in times of recession, hardship, and high unemployment.

The same criteria we follow in our home budgets should be applied by our city commissioners.

They can’t just spend and seek the revenue later. Because most possibly, you and me will be stuck with the bill.

I heard that a former manager of Hallandale Beach, who was making an outrageous salary, (and doing a pretty bad job), was fired at an usually high cost to the city.

The present interim manager assumed his functions just a few months ago.

He will possibly get a bonus of $15,000.

Why is it that the city had to consider this bonus request so soon?

Do you ask your boss for a raise two or three months after you were hired?

Trust me, I hate getting involved in local politics. I would just like to see less pomp and circumstance, less meetings and bureaucracy, less formalities, forms, regulations, and a more down-to-earth management of citizens' money.

Our elected officers should start understanding that they have a mandate to gradually reduce their cities' budgets, because they are inflated and unaffordable.

In South Florida, we are famous for our dozens of municipalities all along the coast, each with its commissioners, offices, firemen, water departments, police departments, and miscellaneous levels of managers, technocrats, and bureaucrats.

While this proliferation of local governments could, in some people's minds, be an advantage of de-centralized government, don’t you think that we can't afford it anymore? Is this really a good idea?

I'd like to hear some comments.

I read this on August 9th, in The Miami Herald:

HALLANDALE BEACH

IS MONEY NO OBJECT HERE?

You would think city commissioners and Mayor J.C. would know better by now. In 2007 the commission and the Mayor gave themselves a whopping $55,000 pay raise without bothering to notify the public first.

As a result, a hailstorm of outrage from local residents rained down on City Hall, and the chastised officials rescinded the raises.

But now city officials are up to the same old game: Hastily and secretly spending taxpayers' money like it grows on trees. First, they were so desperate to get rid of former City Manager Mike Good that they agreed to pay him an overly generous severance package worth $366,653 in total.

Now, the mayor and commission majority want to reward interim City Manager Mark Antonio with a $15,000 bonus on top of his $145,000 annual salary. And, if it hadn't been for Commissioner Keith London, they would have signed the bonus check without benefit of public notice or input.

The talk of a bonus for Mr. Antonio came at the end of long budget workshop session that lasted past midnight last week. Residents had left, and while a video camera was recording the session, the broadcast of the meeting had gone off the air.

The commission turned to an evaluation of Mr. Antonio and generally praised his work. That prompted the interim manager to ask for a $25,000 bonus. Mayor Cooper countered with an offer of $10,000.

Eventually the $15,000 figure was negotiated.

That's when Mr. London blew the whistle for a timeout, saying a vote on the award of the bonus should happen in a public meeting for residents to observe and comment on.

So, eager for some reason to ensure that Mr. Antonio gets his bonus sooner rather than later, the commission set a special meeting for 6 p.m. Monday at City Hall for the bonus vote.

Mysteriously, they just couldn't wait for the next scheduled commission meeting.

Commissioners and Mayor Cooper had better be prepared to justify why Mr. Antonio deserves a bonus simply for doing what he was hired to do.

And to explain why they're so willing to be fast and loose with taxpayers' dollars. 

Henry B. Nathan is a Realtor at United Realty Group Inc.

Visit my websites:

Condo-southflorida.com

GoldenIsles-homes.com

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The Real, Deep Cause of Real Estate Troubles

More than in any other branch of the country's economy, real estate crisis might be the thermometer of US middle class' distress and the looming disappearance of the American dream of home-ownership.

Mortgage abuses and frauds, banks games of hedges, CDO's and Credit Swaps, uncontrolled financial schemes are of course signs of the bad course we've been on. However, they are not the whole story.

They are in fact relatively correctable issues that can be addressed with regulations and government controls.

What hasn't been addressed and will not be any time soon is the continuous deterioration of employment and salaries.

We hear our legislators and our president planning on the creation of new jobs and new opportunities; at the cost of billions to the taxpayer.

This sounds so ridiculous when we read every other day about thousands of American jobs lost, small businesses closing doors, corporation shipping away their research and development departments, their calls centers, their accounting and their software engineering to India or China.

Who are we going to sell these condos and these homes to? Or are we going to end up as humorously said by somebody "selling insurance policies to each other" ?

A substantial part of realtors' activity has been switched to selling a large part of whatever is being sold now, to foreigners, Canadians, French, Japanese, you name it. Because these people are gradually becoming the only ones who can afford buying a home in America. And I am not being xenophobic, just observing facts.

Read for example the following article from the St. Petersburg Times in Tampa. It's the symbol of our times.
Observe that we are not losing blue collar jobs. They have been gone long time ago. It's not about U.S. Steel, or G.M. assembly workers.
What we see now are the very same high-tech class of workers that we are supposed to become, by going back to school to retool our knowledge, learn, and prepare for the new times and the new careers. These jobs, businesses, technologies, that were supposed to keep our country in its traditional position of economic dominance, and sustain the prosperity and livelihood of our middle class.

Read on:

PricewaterhouseCoopers to lay off 500 workers, mostly in Tampa

PricewaterhouseCoopers will lay off about 500 information technology workers, most of them in Tampa, as part of a broader push to outsource to cheaper labor.

The news is an untimely blow to Tampa Bay's economy, which is already battling a 12 percent unemployment rate, the fifth-highest among the country's largest metro areas. It also comes amid a recent resurgence in mass layoffs and growing concern nationally that the economy might slip into a double-dip recession.

"It's just terrible news," Tampa Mayor Pam Iorio said Friday. "It's a terrible job market for those people to find other jobs and I'm very sorry to see it happen. … They're moving jobs away from this community and that's a negative. And it's a negative to our national economy when jobs are moved overseas."

PWC spokesman Jonathan Stoner said the consulting powerhouse employs 1,100 in its information technology group nationwide. Of the 600 remaining employees, most will stay in its Tampa hub, he said. With four locations and 1,850 employees in the Tampa Bay area as of early this year, PWC has been one of the region's top employers. In March, it ranked No. 3 among large bay area companies in the Times' Top Places to Work survey.

Iorio said PWC did not approach the city asking for incentives to keep workers here. "If they're making a fundamental decision to move jobs overseas to reduce labor costs, that's a business decision," she said, "and I don't think there's anything any American city can do to compensate for that."

Stoner said the decision stems from a combination of PWC's information technology groups in the United States and United Kingdom.

"The U.S. and UK firms are combining governance, organizational structure and business processes and a single, Indian-based vendor will provide service to both member firms," he said.

Other reports identified Tata Consultancy Services of Mumbai, India, as the vendor, but Stoner said the company does not comment on clients or third-party contracts.

He also disputed one report that employees were told they would have to reapply for positions at Tata. "What we have told our employees is that they are all to be encouraged to apply for other positions at the firm, at PWC."

Throughout the recession, corporations have continued to outsource jobs to Indian vendors to save money, with Tata often reaping the rewards.

Idearc Media, which publishes the Verizon Yellow Pages, laid off 150 employees in St. Petersburg in December as it transferred much of its publishing business to Tata. Ratings agency Nielsen Media Research also turned to Tata for cheaper labor in laying off 170 information technology employees at its Oldsmar complex in 2008 and 57 in November.

Workers found out about the Pricewaterhouse layoffs on Thursday, coming in the wake of PWC cuts elsewhere statewide, including the shutdown of its tax practice office in Orlando.

A half-dozen workers exiting PWC's Lakepointe office complex on Dr. Martin Luther King Jr. Boulevard on Friday said they were in shock, but were warned by managers not to speak publicly. Workers said the company had not given details on severance packages nor a specific time line, except to indicate cuts would likely be completed by the end of the year.

One worker, an Indian contractor for PWC, said the project he's working on will likely be shut down, leaving him with bittersweet emotions: He's sad for his colleagues here and happy for people in India.

As recently as a month ago, Florida economists were pointing to a slowdown in mass layoffs as a sign that the economy was starting to recover.

But July has been a particularly brutal month based on recent mass layoff notices filed with the state. Among them: 892 workers affiliated with the Kennedy Space Center; 320 with the GEO Group in Graceville; 81 at LifeLink HealthCare Institute in Tampa; 245 at Lockheed Martin Corp.; 344 at Kehe Distributors; 221 at Mosaic Fertilizer in Fort Meade; 100 at Bank of America's Idlewood Avenue location in Tampa; and 67 at Enterprise Leasing in Tampa.

All told, 16 layoff notices have been filed in July affecting 2,864 workers statewide. That doesn't include this week's cuts by Pricewaterhouse.

And, as a Spanish poet said: The rest is silence

Henry B. Nathan is a Real Estate Professional. Please visit our website and learn about:

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Red Light Cameras Might Just Be The Start

I still believe that we can do something about fighting traffic cameras.

I have no doubt that red-light cameras are just the start of a massive program for States and Cities to raise revenues through abusive punitive policies, which in fact are taxes, believe it or not.

Some say: "Relax, it's not as bad as it looks... just a new way of enforcing the law..."

Pundits said the same about Global Trade, US deficits, dismantling US industry, NAFTA, jobs outsourcing, and the mortgage looming disaster, and dozens of issues that are hitting us hard today.

We have grown comfortably accepting everything in the belief that "things will take care of themselves", that we live in the best possible world and nobody is going to change that, and other nonsense.

The truth is that every little issue and problem must be addressed and discussed. I firmly believe that, in time, Big Brothers will proliferate and prosper, at the expense of our liberties and quality of life. This is one notable example.

I totally agree with the following article, read in the Sun Sentinel on July 14, 2010.

Red-light cameras in South Florida – the start of an expensive ride?

Will cash-hungry governments keep expanding technological reach? With cash-hungry South Florida cities and the state in full money-grab mode, will red-light cameras be just the start?

"I don't see why they wouldn't do it for stop signs, too," said Daniel Karten, of Hollywood.

Or how about the state using SunPass transponders to detect speeding violations on toll roads?

Or how about cities using cameras to bust illegal U-turns?

"What's next? Probably speed cameras," said attorney Bret Lusskin, whose successful suit against Aventura's red-light cameras prompted the Legislature to rewrite state law and allow them. "If we don't stop this now, there'll be cameras everywhere, trying to catch anything you do."

Said Karten: "As a driver it stinks, but if I were a city council member sitting up there looking for revenue, it probably makes sense. They've got all this technology. All they have to do is start using it for different functions."

Karten was among dozens of readers who got in touch after I wrote about Hallandale Beach's red-light camera. The camera, on northbound Federal Highway at Hallandale Beach Boulevard, has rung up nearly $1 million in fines since January – a whopping 93 percent for slow-rolling right turns on red.

For now, Hallandale Beach is alone among Broward and Palm Beach County camera cities in enforcing right turn violations. But two cities in north Miami-Dade -- Aventura and Miami Gardens – have been mercilessly doling out right-turn tickets.

Karten said his wife has gotten multiple tickets at cameras near the Aventura Mall, as recently as June. I also heard from people who've been cited for slow-rolling rights at the corner of US 441 and Miami Gardens Drive. "Incredibly frustrating," said Karten.

Karten said he realizes people should follow the law, meaning coming to a full stop before turning. But in the case of these intersections, drivers making right turns often think they are acting safely because oncoming traffic is halted by the crossing street's left-turn signal. "They should put right-turn arrows in, so traffic can keep flowing when the other street has the left-turn signal," said Phil Kodroff, who got cited by the Hallandale Beach camera in May.

But that would cost money, instead of making cities money.

The new state law took effect July 1. It remains unclear what will happen to fines issued before that date, because an appeals court still must clarify that issue.

Still to be hashed out is the growing debate over right-on-red enforcement. The new law says drivers who make right turns in a "careful and prudent manner" may not be ticketed. But the definition of "careful and prudent" will have to be litigated, attorneys and city officials say. "Nobody knows what it means," said Lusskin. "If the cities keep issuing violations for right turns, I expect to challenge it."

According to the state's uniform traffic code, drivers must come to a full stop at a crosswalk or intersection before making a right turn on red. "There is no such thing as a 'rolling stop' and there is no grey area in state law," wrote reader Bruce Hogman, of Fort Lauderdale. Debbie Rozanski, of Pembroke Pines, wrote: "If people can't follow the law, then maybe we should stop allowing right turns at red lights." Mary Zervos, of Hallandale Beach, asked: "Why not have a sign installed, 'Stop here on red, then turn.'"

Under the new state law, a sign is required to mark red-light camera intersections, along with right-turn enforcement. In Hallandale's case, the sign is easy to miss, tucked 10 yards off the side of the road 130 yards before the intersection. "What driver is going to see that, especially at night?" Kodroff said when I showed him the sign last week.

Hollywood recently approved the installation of 10 red-light cameras by year's end, but it hasn't been determined if slow-rolling rights will be enforced. Ditto for Fort Lauderdale, which will have 11 cameras running by next month.

"When we gave approval, I never realized that cameras could be used this way," Hollywood Mayor Peter Bober said Wednesday. "I don't support playing 'gotcha' with drivers." Bober said he would like to see a middle ground, perhaps only ticketing those who go above a certain speed making a right on red.

"If you make a safe turn, but you're still going one mile per hour, I don't think that deserves a $158 fine," Bober said. "We should be trying to deter the most egregious and dangerous types of behavior, not giving people more reasons to hate municipal government."

From The Sun Sentinel - Michael Mayo - Columnist , July 14, 2010

Henry B. Nathan is a Realtor at United Realty Group Inc.

Visit my websites:

Condo-southflorida.com

GoldenIsles-homes.com

Golden-Beach-Homes.com

The Beach Club Condos