State Politics

How U.S. Senate candidate Carlos Beruff avoided $235,000 in taxes

Republican U.S. Senate candidate Carlos Beruff has received agriculture tax exemptions on more than 1,800 acres of land he plans to develop. One this land in Parrish, Beruff has claimed land as pastureland, which has cut his taxes on the 55 acres from $11,072 to $210.
Republican U.S. Senate candidate Carlos Beruff has received agriculture tax exemptions on more than 1,800 acres of land he plans to develop. One this land in Parrish, Beruff has claimed land as pastureland, which has cut his taxes on the 55 acres from $11,072 to $210. Tampa Bay Times

Republican U.S. Senate candidate Carlos Beruff has been a land developer, jeweler and now a politician who is bidding to defeat incumbent Sen. Marco Rubio for re-election.

But in at least two Florida counties he has additional titles: farmer and lumberjack.

While the wealthy land developer has never worked a plow or chopped trees himself, he has been able to shield nearly 2,000 acres of future development land from taxes by claiming an exemption created a half-century ago for Florida’s farming communities.

Beruff, who vows to cut taxes if elected, avoided $235,000 in 2015 taxes for his business holdings. He did it by claiming that the 1,884 acres his companies bought to develop in the future are agricultural land because they are leased to cattle companies or have planted pine trees or other crops.

While Beruff is not a farmer, the exemptions are all legitimate, his campaign says.

“Carlos and his company acquired significant land holdings and now have decades worth of forward inventory,” Beruff spokesman Chris Hartline said. “The company leases out some of their land to farmers who don’t have the resources to buy land or expand their farms. Other parcels of land are used for industrial agriculture.”

Beruff, 58, is facing an uphill battle against Rubio in the Aug. 30 primary. Public polls show Beruff way behind, but he’s spending nearly $1 million a week of his own money on television advertising.

Florida’s so-called “Greenbelt Law” was created in 1959 to protect farmers from rising property values and increasing tax bills.

The state’s farming industry would be in ruins if not for the agricultural land classification, said Adam Bassford, director of legislative affairs for the Florida Farm Bureau. Without it, farmland would be assessed at “the highest and best use” standard that would result in unaffordable taxes.

“It truly is what allows us to continue to farm in Florida,” Bassford said.

But land developers benefited from the law, placing cows and anything that could pass as hay on their land to get a tax exemption to reduce their tax burden. Getting an agricultural exemption can cut a tax bill by 85 or 90 percent.

In Beruff’s case, leasing cows to graze on 932 acres of abandoned citrus groves along Interstate 75 near the town of Parrish has cut taxes for Cargor Partners VI — one of his land-holding companies — by about 86 percent. What would have been a $62,184 tax bill dropped to $8,458.

While cattle are hard to find on the land, his soil supports a different kind of crop: campaign signs.

They are planted in Beruff’s land along I-75 to tout his campaign and that of Joe Gruters, a Republican running for the Florida House of Representatives.

On a 55-acre tract about 12 miles away, the tax bill for another land holding company under Beruff’s control dropped from $11,072 to just $210 because it was declared pasture land by the Manatee County property appraisers office.

Beruff has had rows of pine trees planted on another Manatee property until his companies are ready to build more homes. The county now considers that land timberland and charged him $12.98 in taxes on 5.8 acres. Without the trees, Beruff’s companies would have paid $990 in taxes on the land.

Manatee County Property Appraiser Charles Hackney said it may be that the plan is “to ultimately grow houses.” He said in Beruff’s case, he’s fenced the property and his agricultural experts have verified that the land is being leased to cattle companies. Hackney has not denied any of Beruff’s applications.

But in Lake County, Beruff has struggled to get his agricultural exemption. In 2013, Beruff’s Medallion Home company sought to get an agricultural exemption on 196 acres in Mount Dora bordering another subdivision by claiming his property was a hay field.

Lake County Property Appraiser Carey Baker said his agriculture inspectors checked on the property and deemed it wasn’t really a commercial hay field.

“It was just a bunch of weeds,” Baker said about why he denied the application. “You can’t bale weeds.”

Beruff’s company appealed the decision, but it was denied in early 2014. Beruff came back a year later, and applied for another exemption. This time he planted 117 acres of pine trees and asserted he had a forestry management plan. That was good enough to win the exemption.

“We all know in the long term developers are developers and they are not going to be in the hay business or the timber business,” Baker said. “But the case law is clear: We are to grant an application if it is a bona fide agricultural business.”

U.S. Sen. Bill Nelson, a Democrat, has benefited from the same agricultural classification law, though on a lesser scale. Nelson has a 55-acre tract of land in Brevard County that has been in his family since 1924 and that he leases out to a cattle operation, cutting his tax bill to less than $4,000 a year. The farming family of former U.S. Sen. Bob Graham grazed cattle in Miami Lakes to reduce taxes on property they planned to develop.

Bassford said there have to be assurances that people are not gaming the system.

“The worst thing for agriculture is to have a black eye from people abusing it,” Bassford said.