Local governments view tax relief on ballot as state threat to their authority
Related: Editor's Note: Is Amendment 3 the right tool to promote tax savings?
By Rich Pollack
It has been a sore spot bothering local government leaders for decades.
Home rule, the ability for cities, counties and towns to make key decisions affecting their residents, has been eroding with state leaders in Tallahassee invading the authority of local elected officials, many say.
Under current legislation, for example, most Florida municipalities are prohibited from passing more restrictive land use regulations, at least until next year, and are stopped from banning short-term vacation rentals, such as an Airbnb. State laws also prohibit municipalities from enacting any regulations on firearms and ammunition.
“Home rule is constantly being eroded by legislative acts, unfunded mandates, legislative constraints and regulatory rules that preempt local decision making and budgeting and funding decisions,” says South Palm Beach Town Manager Jamie Titcomb.
Now there are those who fear a proposed constitutional amendment on the November ballot would be another blow to municipal governments and an increased power shift away from local self-governance should voters approve it.
What is known as Amendment 3 would raise the exemption on homesteaded properties from $51,411 this year to $150,000 in 2027 and to $250,000 the following year if it receives at least 60% voter approval.
Who controls the money?
Those familiar with the workings of government say that if the amendment passes, local governments will have less money to spend and will most likely be more dependent on the state, and in some cases the county, to cover the cost of services to residents.
“It’s the power of the purse,” says Charles Chapman, a legislative advocate for the Florida League of Cities. “The power shift is wholly centered on who controls the money.”
If local governments don’t have money to do what needs to be done, he says, they could be forced to go to the state for help. Those who are elected by the residents of their community will in many cases no longer always be the final decision makers on what funds get spent where.
“All of a sudden it goes from a relationship-driven process to a decision being made by someone far away who has never been to that community,” Chapman says. “We’re seeing the local government’s authority being undermined because of finances.”
Soaring property values
Supporters of the amendment, including the president of the Florida Realtors, say the amendment is about affordability at a time when many residents are struggling to make ends meet — and the higher exemptions will keep more money in people’s pockets.
“We just totally focused on affordability,” says Broward County Realtor Chuck Bonfiglio, who leads the organization. “We want to make sure everyone has the opportunity to buy a home.”
Supporters of Amendment 3 — including the Florida Realtors, which has committed $10 million toward promoting the proposal to voters — have pointed out that local governments have received more revenue as property values increase. They say spending should be reined in.
Titcomb from South Palm Beach, who is also a former executive director of the Palm Beach County League of Cities, counters that actions of municipal leaders are often closely watched by residents.
“At the local level, we’re under more scrutiny than any other level of government,” he says.
State leaders over the years have defended legislation that gives the state more say in local decisions as being important for consistency instead of having a patchwork of rules and regulations throughout the state.
Bonfiglio believes the local governments and those in Tallahassee can work together to find workable solutions to financial issues that arise while managing taxpayer dollars wisely.
“I think there’s tremendous opportunity for collaboration between state and local governments,” he says.
A domino effect
The shift in decision making could filter down to the county level. Palm Beach County Administrator Joe Abruzzo thinks that a handful of municipalities could end up dissolving because the amount of revenue coming in wouldn’t be enough to keep the town running.
“There are municipalities in the county that will no longer be sustainable,” he says.
Should a municipality fold, the responsibility for providing services to those residents would rest in the hands of the County Commission.
Along with having to provide services, the county would also be responsible for paying off the debt of those cities and towns at a time when the county itself could be faced with a shortfall of about $330 million.
Just dealing with the loss of $230 million in general fund revenue and the loss of $100 million in money to cover the fire rescue operation is enough to cause Abruzzo to lose sleep.
“Knowing the impact to first responders, the impact to county services and what it will mean to residents has kept me up at night,” he says.
A growing separation
For residents of a community forced to dissolve should the amendment pass, there would likely be more distance — both physically and relationship wise — between them and decision makers.
Now residents might have a chance to voice their concerns to an elected official whom they see at church or synagogue or who might live down the street. But that might be more of a challenge if the County Commission is making the decisions — let alone the state.
Abruzzo says county commissioners will continue to listen to residents, including those who come from former municipalities.
“Our board would do a great job,” he says.
Abruzzo, a Democrat who served in the Florida House of Representatives and the Florida Senate, says he believes the relationship between the state and local governments is a distant one.
“Amendment 3 is a blatant gut punch to local government,” he says.
Enter the state
Abruzzo and others say they are hearing rumblings that one of the future goals of state leaders would be to do away with property taxes and raise the sales tax.
“They would raise sales taxes to new heights,” he says. “It could be the highest rate in the nation.”
The idea of a sales tax increase and the potential for the state distributing it to local governments to offset the lack of property tax revenue is concerning to Bill Thrasher, Briny Breezes’ manager who previously was manager of Gulf Stream and interim manager of Highland Beach.
“State-controlled sales tax collection and distribution will significantly reduce local control, the local voice, and convenience of attending public budget hearings where spending decisions are made,” Thrasher says. “Verifiably, local government is better governance of the public dollar.”
Putting the power to make local spending decisions in the hands of the state Legislature, Thrasher says, is problematic.
“How many state legislators have even heard of the Town of Briny Breezes?” he asks. “How could they even begin to understand the town’s current situation and the various critical issues facing Briny taxpayers?”
Money concerns
Chapman from the League of Cities uses an example of a city with a public library no longer having the money to run a special program.
The city can go to the state and ask for money through a grant program or ask for money through an appropriation that usually is sponsored by a legislator but must be approved by the Legislature and signed off by the governor.
“Lord help us if the Legislature has a different political philosophy than the program the library is providing,” he says.
Chapman gives another example of a group of residents going to their city commission asking to make improvements on a local road that residents say needs to be repaired.
If there’s not enough money in the budget because there’s less property tax revenue, the city could go to the county, but that might be a long shot because the road is not a county-maintained road.
If the county can’t help, the city could go to the state, but the state doesn’t have a process to fix a residential road, Chapman says. The city could then have to decide if the road improvement is more of a priority than building a playground or adding another paramedic.
For Abruzzo, the solutions will not come easy and they most likely won’t be popular.
He says he sees the look on the faces of residents when he talks about having to make cuts that will have a long-term impact.
“I do dread our residents’ demands and expressions when they realize the impact that Amendment 3 will have on our county if it passes,” he says. “It will not look and feel the same as it does today.”
Bonfiglio from the Realtors association believes that Amendment 3 has sparked necessary conversations that show a common denominator.
“We all want the same thing,” he says. “We want our communities to thrive. It’s just a matter of how we get there.”
Don’t forget to vote
Election Day is Nov. 3. Polls are open 7 a.m. to 7 p.m. The last day to register is Oct. 5.
Voters can request and send a mailed-in ballot, but it must be received by 7 p.m. election night.
Early voting is being held Oct. 19-Nov. 1 at 28 locations.
The ballot includes races for governor, U.S. Senate and other county, state, federal and judicial offices, three state constitutional amendments, and three county ballot questions.
For more information, go to votepalmbeach.gov.
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