F ollowing the release of his new budget recently, Gov. Rick Scott stepped in to an argument with legislative leaders over the definition of something that seems simple enough: “Tax hike.”
It’s an old debate that goes like this:
Property taxes are a mathematical function of home value and tax rate. If the tax rate doesn’t increase, but the home value does, a homeowner ends up paying more out-of-pocket taxes. Is that a tax increase?
Yes and no.
In the “no” camp is the governor. To qualify as an increase, he maintains, the rate must increase. Fair enough. That’s what every elected official in his position says. (In Sarasota County, commissioners boast they haven’t increased taxes — except a teensy insect’s wing amount for mosquito control — in well over a decade. True, the rate is even. But, with property values soaring again following the recession, a lot more money is rolling in.)
House Speaker Richard Corcoran takes the other side. Pay more and it’s a hike. His counter-argument involves something called a “rollback rate,” a concept under which tax rates are lowered to a point that the money raised remains the same.
So, “not raising taxes” means, literally, not raising the level of tax revenues.
At the heart of the debate is the governor’s plan to increase state funding for K-12 education by $815 million in the coming year, to a total $21 billion. To do that, per-pupil funding would be hiked to $7,421 — $216 above this year.
Which is a worthwhile goal.
But here’s the trick.
State funding to local school districts basically comes from two pockets. (Look for two separate line items on your property tax bill.) Of the $21 billion total, $11.6 million would come through state funding. The rest — $9.4 billion — would come from the “required local effort,” a fluctuating amount raised by local property taxes.
According to the news service Politico Florida, more than 68 percent of Scott’s funding increase comes from this pocket. The $558 million “required local effort” represents an increase of 6.3 percent. The state’s part — $257 million — is an increase of only 2.3 percent.
Same old shell game. The state increases school funding. Local property taxpayers foot the bill.
Define it as you see fit. Just set aside more cash in the savings account. You’re paying for it.