Palm Beach Post Staff Writer
Friday, January 18, 2008
Florida's Save Our Homes amendment has helped the state's wealthiest homeowners the most, and voter approval of a property tax amendment on Jan. 29 would magnify the benefits for owners of expensive homes, two university professors conclude in a new study.
"Higher-value properties receive a greater benefit of the (Save Our Homes) tax shield relative to lower-value properties," Florida Atlantic University's Tim Allen and Oklahoma State University's Bill Dare write in their 16-page report.
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Their findings - which will be published in the Journal of Real Estate Research, a scholarly publication - don't qualify as a shock. While proponents of Save Our Homes pushed the measure in 1992 as a way to keep little old ladies from being taxed out of their houses, critics long have argued that the biggest benefits accrue to the wealthy.
"This was no surprise to anybody," Allen said of his study. "But this is evidence that the effect that people predicted is true, and to a measurable degree."
Because this is an academic paper, that measurable degree is expressed as a "coefficient" that Allen acknowledges only statisticians will understand. The bottom line: Owners of the priciest homes are enjoying the biggest benefits - and shifting the tax burden to everyone else.
The study doesn't name names, but a number of prominent Palm Beachers have big chunks of the values of their mansions sheltered by Save Our Homes. In 2007, the break cut the taxable value of attorney Bob Montgomery's home by $15 million, singer Jimmy Buffett's by $12.7 million, Rush Limbaugh's by $12.6 million and Tampa Bay Buccaneers owner Malcolm Glazer's by $11.5 million.
Homeowners lose the tax break when they move, but voter approval of a measure on the Jan. 29 ballot would make the savings portable.
"Portability is going to further the gap between the savings afforded to higher-value homeowners and lower-value homeowners," Allen said.
Proponents of Amendment 1, which goes to voters in less than two weeks, counter that it represents a tax cut for everyone. Vivian Myrtetus, spokeswoman for Yes on 1, a group campaigning for the measure, said the amendment would limit the break homeowners could take with them to $500,000 - so if Montgomery were to move to another mansion, he could take only $500,000 of his tax cap with him.
Matt Puckett
Deputy Executive Director
Florida Police Benevolent Association