Tax protesters organize, but face lengthy battle
More than 70 business and property owners on Anna Maria Island met Oct. 14 at the Holmes Beach commission chambers to learn more about the Citizens Against Rising Taxation group that has formed to reduce taxation and the market value assessment method that has caused Island taxes to increase more than 113 percent in four years. Islander Photo: Rick CatlinClick to enlarge
More than 70 concerned Island business and property owners calling themselves the Citizens Against Rising Taxation jammed the Holmes Beach city commission chambers Oct. 14 in the second protest meeting of the past two weeks against rising taxes on the Island, taxes that many claim are forcing them out of business (The Islander, Sept. 15, 29, Oct. 13).
But the gripes and protests were aired at the previous meeting, said Anna Maria Island Chamber of Commerce president Don Schroder, who acted as co-moderator. This meeting should focus on "organizing and problem solutions," not individual complaints and problems.
Schroder said he's found a number of Florida barrier islands and states with similar problems and he's organized a meeting with State Rep. Bill Galvano and State Sen. Mike Bennett Oct. 25 to make a case for legislative action statewide.
Unfortunately, a statewide referendum to change the way Florida appraises property from a market value system to something more equitable might take years - and big bucks - to get on the ballot.
But it can be done, said co-moderator Nigel Brown. CART can focus on changing the state rules from market value assessment to a cap rate or an acquisition value rate, as California did under Proposition 13 several years ago. Brown noted that Maine is voting Nov. 2 on an amendment to appraise property under the acquisition value system.
A new county?
Closer to home, however, CART can look at forming its own county to handle the money. A similar effort is under way in Bar Harbor, Maine, whereby that city would form its own county and contract for services with other counties. "This would give us [the Island] financial independence," he said.
While breaking away to form a new county is a possibility, it's a long and involved process, said Brown. It would be much faster for tax relief to challenge the county budget process.
Change budget process
Cities and Manatee County look at how much tax money they're getting, then set a budget to spend that money. And nobody ever asks the county to spend less, Brown observed. With ever-increasing ad valorem taxes, maybe it's time to ask the cities and county to justify their budget increases. That only addresses the tax rate, however, not the valuation process.
Professional advice needed
Brown said he's talked to several attorneys with expertise on tax valuation and constitutional amendments, and said he got conflicting advice. "But we do need to find a professional in this area" if CART is to go forward, he said.
There is a professional lobbyist in Tallahassee who's had experience with state referendums, but Brown has not received any cost estimate.
Others at the meeting suggested various attorneys with tax expertise, and Kent Davis of Siam Gardens Resort said he'd talked with a Sarasota attorney with considerable experience with the 1992 Save Our Homes referendum, which capped homesteaded properties at a maximum of 3 percent increase in tax value annually. That referendum has removed some $3 billion in property values in Manatee County from increasing assessments, shifting the burden of taxation to meet the county budget onto commercial and non-homesteaded property owners, Schroder observed.
Brown also said he's learned that if Manatee County were a chartered county, it could set a cap on taxation. However, a measure to change the county to a charter form of government was defeated by voters two years ago.
While CART is still "gathering information" and looking for experts, Schroder said Galvano will be speaking at the Twin Dolphin restaurant in Bradenton Oct. 20 on constitutional amendments and how to structure them. Schroder and other CART representatives plan to attend.
All well and good, said Anna Maria resident Norm Mansour, who serves on the Florida commission to create a high-speed rail network as mandated by a constitutional amendment. But be prepared for the long haul.
"Based upon my experience, you have an uphill battle. There are not a lot of opportunities" to cut taxes immediately, he said.
Voice of experience
Former Wisconsin Lt. Gov. Russ Olson, now a Holmes Beach resident, agreed. He tried for years to reduce spending and taxes in Wisconsin, "but with little success." Those are just temporary measures and won't solve the property valuation issue. "The problem now can only be solved by a constitutional amendment," he said, "and you're probably looking at around $5 million to get it passed."
And CART isn't likely to get many homesteaded property owners involved, noted Olson, because they're not being affected.
"They will be when there are no shops or restaurants left on the Island," quipped Sabine Muesil-Buehler of Haley's Motel.
So where does CART want to go from here? asked Schroder. He noted that according to his information, the earliest a statewide referendum could be on the ballot was 2006, and that would require 485,000 signatures, a daunting task for such a small group.
But the task doesn't faze Schroder. He's already talking to major Island property owners such as Publix and Benderson Development, in addition to his talks with Galvano and Bennett. "We're going ahead, and right now, we need your time and money, hopefully both. We need to get people involved to do research, public relations, spread the word, form committees," he said. "The entire community needs to know the danger."
The chamber pledged $2,500 in a fund for professional services to help CART, and many members in the audience quickly began writing checks in support, with pledges amounting to $3,800 by the close of the meeting.
Once CART is organized and has an actual action plan, Schroder said Manatee County Property Appraiser Charles Hackney has agreed to meet with CART representatives.
"We're in a two-pronged approach right now," noted Brown. "We're going to fight the county on the budget process, and the state on the assessment method."
Schroder presented documentation from the Manatee County Property Appraiser's Office showing Island property values have risen from a total of $996 million in 2000 to $2.126 billion for 2004-05.
"That's up 113.4 percent. That's what we're facing. A very serious situation." Island businesses are selling out because they can't afford the taxes. Schroder, a licensed real estate agent, said in the past week, he's had five businesses list their property because "the owners feel they can no longer afford the taxes. Everyone's going condo."
Unfortunately, that's where the money is, Schroder noted.
As an example, he cited a six-unit accommodation property that could be sold for around $500,000. However, if those units were converted to condominiums, the owner could sell each unit individually for about $500,000. And the property appraiser has deemed that condominiums are the highest and best use of the property and valued accordingly. Instead of about $16,000 in taxes, that owner now owes around $100,000.
"We need solutions now," Schroder suggested, "or in five years, we won't be here to enjoy this Island."
Schroder will announce the next CART general meeting after he and CART representatives meet with Galvano and Bennett. Brown will have specific information on costs for a lobbyist and/or an attorney to coordinate any referendum effort by the next CART meeting.
Islander contribution noted
Anna Maria Island Chamber of Commerce president Don Schroder gave a special "thank you" to The Islander newspaper for a series of articles in September on rising Island property values as part of the impetus for forming Citizens Against Rising Taxation.
"We had been concerned and planned to do something, but after the stories came out in The Islander, we were flooded with calls for action. We decided the time to form our group had come," he said.