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Thursday, Aug 28, 2014
Politics

School tax increase equals Scott’s other tax cuts

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Published:   |   Updated: May 5, 2014 at 09:10 PM

­­— Gov. Rick Scott will bring his re-election campaign to Tampa on Tuesday to tout a new state budget with $574 million in increased education spending along with $500 million in tax cuts.

What Scott isn’t mentioning is that while the new budget cuts some taxes, it includes an increase of almost as much, $400 million, in the property taxes the state requires local governments to impose to help fund public schools.

Responding to those numbers, Scott’s likely Democratic opponent, former Gov. Charlie Crist, on Monday accused Scott of a fraud against taxpayers.

“He did it by raising property taxes $400 million,” Crist told reporters in Miami. “That’s unbelieveable. That’s the last thing we need to be doing.”

The record-setting, $77.1 billion state budget just passed by the Legislature, which Scott is expected to sign, cuts $400 million in motor vehicle registration and other fees and includes another $100 million in smaller cuts such as sales tax holidays for school and hurricane supplies.

That provides a talking point for Scott because the highly unpopular motor vehicle fees were increased while Crist was governor as Crist and state legislators scrambled for money to avoid deep budget cuts during the Great Recession.

Scott’s campaign, meanwhile, denies his budget raises education property taxes, saying the tax rates aren’t changing.

“It’s property values – not property tax rates – that are on the rise,” said a statement from Scott spokesman Greg Blair. “Home values are increasing, not state property taxes.”

Applying the same rate to increased values, however, will produce higher tax bills for homeowners.

They’ll see the increase on tax bills they get from local governments even though it’s state government that’s forcing the hike.

The taxes involved are known to state budget planners as “required local effort,” or RLE, and they’re shown under the heading “By state law” on tax notices from the local property appraiser’s office.

The RLE, plus a smaller tax imposed at the discretion of the local school board, will total $8.24 billion statewide next year compared to this year’s $7.84 billion.

Although school boards can decide whether to impose the discretionary taxes, they have little choice, said Jim Hamilton, lobbyist for the Hillsborough school system. Many counties including Hillsborough would lose substantial state funding if they didn’t and the Legislature’s budget assumes they will.

The RLE increase means a greater share of the burden of education funding will come from property taxes as opposed to taxes paid directly to state government such as state sales taxes, corporate income tax and the motor vehicle fees. Scott has undertaken initiatives to cut corporate income taxes and sales taxes on manufacturing equipment.

The property taxes will amount to 43.6 percent of total education funding in the coming year compared to 42.8 percent this year.

The change recalls a move that revamped school funding in the 1990s and early 2000’s, Hamilton said, shifting the burden off of state taxes and onto the RLE.

That trend started under Republican-dominated legislatures and continued during the early part of Crist’s term as governor. It upped the share of education funding that comes through property taxes from about 38 percent in 1998 to 51.1 percent in 2008-09, according to figures from Hamilton and the state Department of Education.

The recession halted the trend by sharply cutting property values, Hamilton said.

Federal economic stimulus money, accepted by Crist, and later state general revenues were used to make up the difference.

Former state Sen. Dan Gelber, a Crist backer, said the recession left Crist and the Legislature little choice at the time.

“We were desperate to try to keep teachers employed,” Gelber said. “But now we’ve got a multi-billion dollar surplus and (Scott) is still shifting the burden to homeowners,” said. “It’s just crazy.”

The new budget, fueled by increased state revenues, increases per-student funding but not back to its peak level in 2007, while Crist was in office.

“Out of $2.5 billion in new revenue, only 7 percent of that went to K-12 education,” Cate said.

Scott will appear at noon Tuesday at Brandon Honda as part of his “Help Is On The Way Tax Cut Tour,” a formal campaign kickoff that began Monday with appearances at car dealers in Jacksonville and Sanford, touting the motor vehicle fee cuts.

wmarch@tampatrib.com

813-259-7761

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