Miami-Dade County

The politics of Miami-Dade property taxes in two charts

Carlos Alvarez, then-mayor of Miami-Dade County in this 2011 file photo, raised property taxes during his last year in office. Declining real estate values meant the county collected less property-tax revenue that year. His successor, Carlos Gimenez, is proposing a slight dip in property-tax rates this year, but property-tax revenues should hit a new record thanks to a boom in values.
Carlos Alvarez, then-mayor of Miami-Dade County in this 2011 file photo, raised property taxes during his last year in office. Declining real estate values meant the county collected less property-tax revenue that year. His successor, Carlos Gimenez, is proposing a slight dip in property-tax rates this year, but property-tax revenues should hit a new record thanks to a boom in values. Miami Herald Staff

As he heads into a reelection vote next month, Miami-Dade Mayor Carlos Gimenez enjoys at least one undeniable advantage: rising property values.

A 9.1 percent boost in values countywide allowed him to propose a $7.1 billion budget last week that includes the lowest property-tax rate in three years combined with the most property-tax revenue that Miami-Dade has ever collected.

The result: a budget with a 4 percent raise for workers, expanded library hours, a 2 percent increase in the county’s 27,000-person workforce, an extra $3.7 million for the county’s new animal shelter, and $41 million for syncing traffic lights. The single largest source of funding for those expenditures, $1.7 billion in property-tax revenue, comes from tax rates that are just a bit lower than they are this year — from $976 for every $100,000 of a property’s taxable value, down to $971.

Needless to say, the 2017 budget landscape is a far more hospitable environment than Gimenez’s predecessor faced in his final year in office.

Then-mayor Carlos Alvarez’s 2011 budget included an extremely unpopular tax-rate hike: the maximum rate charged properties in the suburbs went from $974 per $100,000 of taxable value to $1,105, a 13 percent increase. Backlash against the rate increase helped fuel an historic recall of Alvarez, followed by a special election that put Gimenez in office.

Our Dade Data chart above shows the changes in tax rates and tax revenue when it comes to Miami-Dade real estate.

While Miami-Dade’s property-tax rate soared under Alvarez’s final budget, property-tax revenue actually dipped. That year, Miami-Dade collected $1.51 billion property taxes, the largest single source of revenue for the government’s general functions like police, roads, transit, libraries and firefighting. That was down 3 percent from the prior year’s tally, despite the tax-rate increase. Alvarez was also slammed for proposing a budget that came with a three-percent raise for county workers at a time of rising unemployment and lower wages.

The year of Alvarez’s final budget, Miami-Dade was in the midst of a real estate crash that sent property values down 24 percent in three years. The 2011 budget year saw countywide values drop 14 percent alone, which would have meant a loss of $225 million in revenue if tax rates had remained flat, according to Dade Data calculations using revenue-forecast figures released by the Property Appraiser Office that year.

Alvarez’s rate hike limited the revenue loss to about $40 million.

Gimenez won the post-recall special election in 2011 while campaigning on a promise to undo Alvarez’s unpopular tax-rate increase. And he delivered. His first budget, which covered most of 2012, lowered tax rates by 12 percent, to $974 per $100,000 of taxable value. He won the tax cut at the same time county commissioners approved the first of Gimenez’s austerity budgets, which included pay cuts for union workers, reduced services and a broad range of spending cuts.

During Gimenez’s first budget year, Miami-Dade saw property-tax revenue plunge by about $215 million, a 14 percent decline. That was mostly thanks to the rate cut and not the real estate market, which was heading toward a bottom and sent property values down a modest 3 percent for the year.

That first budget of the Gimenez era essentially forced the steep spending cuts that Alvarez avoided with his rate increase. And it set up Gimenez’s overall budget trajectory: hold fast on the lower tax rate while counting on higher property values to eventually allow for more spending. The real estate market cooperated: his 2012 budget was the last one when the mayor had to deal with a smaller tax base, and values have risen 34 percent since.

Even so, spending was tight enough that in 2013 Gimenez briefly proposed a tax increase, largely to boost funds for animal sterilization efforts demanded by the Pets’ Trust advocacy group. Under pressure from critics, Gimenez reversed course, issued a second proposed budget and won approval of a small rate decrease that year.

With property value gains topping 9 percent for 2017, Gimenez has an additional $132 million worth of property-tax revenue to spend without any of the tax-rate angst of prior years. On Tuesday, Miami-Dade commissioners are expected to endorse Gimenez’s 2017 revenue plan by capping property-tax rates at his recommended level of $970 per $100,000. Even flat rates don’t mean flat tax bills when real esttate values rise, since most property owners pay more thanks to the higher assessments that are driving the 9.1 percent increase in the countywide tax rolls.

Gimenez’s plan for the 2017 budget year, which begins Oct. 1, keeps most property taxes flat, though two tied to debt payments declined. That allowed the overall rate to drop about a half-percentage point. That’s not much of a decline, but it’s a huge improvement over the budget math presented by some of Miami-Dade’s most difficult years.

Dade Data is a Miami Herald online series that analyzes some of the most important numbers behind Miami-Dade County government.

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