Florida House Speaker Richard Corcoran famously said “hell, no” last month to any property tax increases during the 2017 legislative session. That’s not scaring off the state Senate, though.
Senators plan to test Corcoran’s hardline stance and are proposing to spend almost $540 million more than the House next year on K-12 public education by using extra property tax dollars gleaned from rising property values.
Senate budget leaders contend it is “not a tax increase” because the tax rate won’t change under their budget plan. But the House says that it is, because homeowners and businesses will pay more money toward their tax bill if their property value went up this year.
Those opposing philosophical views — now laid out in official House and Senate education budget proposals released Tuesday — set up the Legislature for a showdown in budget negotiations over the next month in how much to spend on public schools in 2017-18 and how to fund any increase.
The Senate specifically proposes spending nearly $21 billion on K-12 education in 2017-18, $790 million more than this year. That includes a nearly 3 percent increase, or an extra $210 each, in per-student funding, bringing it to $7,414 per student.
By comparison, the initial House plan calls for just a $19 per-student increase, to $7,224 — barely a quarter of a percentage point hike because the House isn’t willing to collect more state dollars from the rising property values through what’s called the “required local effort” for school funding. The House wants only a $251 million increase in K-12 funding for a total budget of $20.4 billion next year.
In explaining the Senate’s logic that increasing the “required local effort” isn’t a tax increase, Pre-K-12 education budget chairman David Simmons said: “Because if the value of [a person’s] property goes up, we don’t consider the additional amount of taxes they pay to be tax increase.”
“We consider it incidentally to be an increase in value to the property,” said Simmons, R-Altamonte Springs. “There is a difference between maintaining a level and a tax cut. So this is not a tax increase; it’s simply keeping things as they are.”
House leaders, though, are standing by Corcoran’s position.
“I think the Speaker was quoted as saying, ‘Hell, no,’ on raising taxes so I’m just going to defer to his quote,” House Pre-K-12 education budget chairman Manny Diaz Jr., R-Hialeah, told reporters when asked about the opposing budget plans.
House budget chairman Carlos Trujillo, R-Miami, said that when Florida homeowners get their property tax notices, it’s not lost on them when they have to pay more money, and he said the notice itself defines what constitutes a tax increase.
“The Truth in Millage Notice says if you raise the value, it’s an increase in taxes,” Trujillo said. “If you paid $5,000 and next year you pay $5,200, I don’t see that as a decrease or as revenue-neutral. It’s a tax increase.”
The Senate’s budget proposal for K-12 public schools is quite similar to what Gov. Rick Scott recommended in January. Like the Senate, Scott also argues using revenue from rising home values doesn’t constitute a tax increase.
His suggested budget called for an $815 million increase in school funding, of which $558 million would have come from the extra property tax revenue. His budget would’ve raised per-student funding to $7,421.
Simmons attempted to downplay the extent of the Senate’s plan arguing that $148 million of the $540 million increase from property tax revenue wouldn’t be borne from existing home- and business-owners’ pocketbooks. Rather, that portion would be generated from new construction, “properties that were previously vacant and maybe a shopping center or subdivision was built,” Simmons said.
Asked about the void between the House’s and Senate’s budgets and reminded of Corcoran’s remark, Simmons smiled broadly.
“I believe that it’s a beginning point, and once we’re able to explain what the component parts of the increase in collections of taxes is made up of, we’ll be able to reach a consensus with our colleagues in the House,” he said.
He added: “I respect the principle that is being presented and I believe that as to a portion of this that we can yield on — but just the same, they can yield, because this is not a tax increase.”
Herald/Times reporter Steve Bousquet contributed to this story.