1. Gregory S. Brown, CFA Santa Rosa County Property Appraiser Web Presentation

2. Any of the examples in this presentation do not take into account any exemptions other than homestead (so the examples do not include seniors, veterans, widows, disability, etc.) or any taxes or non- homestead special assessments.

3. Affects of Amendment One (A1)

4. Amendment One is a constitutional amendment passed by the citizens of the State of Florida. Amendment One dealt with only four initiatives.

5. Four Elements of Amendment One (A1)  Doubles the Homestead Exemption an additional $25,000 for property assessed above $50,000. Does not apply to School taxes.  Offers portability of accrued benefits (up to $500,000) under the Save Our Homes cap.  Creates capping of non-Homestead assessments at 10% each year (similar to Save Our Homes capping).  Provides a $25,000 Exemption on Tangible Personal Property.

6. Double Homestead $100K $75K $50K $25K No further Exemptions Second Homestead Exemption from County, City and NWFL Water Management taxes. No Exemption for Homestead Homestead Exemption from County, School, City and NWFL Water Management taxes. $0 Assessed Value

7. Amendment One Continued… Amendment One is not a revenue capping constitutional amendment. Any capping of taxing authorities revenues was passed by the Florida Legislature in their special session in 2007. Primarily, their action limits government revenue increases to new construction and Florida’s personal income growth only.

8. Affects of Amendment One (A1) The Additional $25,000 Homestead Exemption only affects the portion of your ad valorem taxes dealing with county, city or any agency levying a millage rate against your property value (ad valorem). The Additional $25,000 Homestead Exemption does not affect the school tax portion of your proposed taxes.

9. Affects of Amendment One (A1) Continued… To calculate the tax savings for county residents with no 3% assessment increase for Save Our Homes: $ 25,000 Exemption amount x.0061403 Proposed Millage Rate* $ 153.5075 Tax Savings due to A1 * Millage Rate is for County and Northwest Florida Water Management (NWFWM) and does not include school taxes.

10. Affects of Amendment One (A1) Continued… If you have owned your home for several years, you may have accrued a Save Our Homes (SOH) differential. This is the difference between your market value and your assessed value. The SOH Amendment limits the increase in your assessed value to no more than 3% per year or the consumer price index, whichever is less.

11. Example of SOH Differential Market ValueAssessed ValueSOH Diff. 2005 $100,000 $100,000$ 0 2006 $150,000 $103,000$ 47,000 2007 $150,000 $106,090$ 43,910 2008 $130,000 $109,273$ 20,727 The assessed value cannot increase more than 3% per year even though the market value decreased. As long as there is a difference between assessed value and market value, the assessed value will increase under the current state rule.

12. Affects of Amendment One (A1) Continued… This year Chris Jones (Escambia County Property Appraiser) and I tried to persuade the Chairman of the Senate Finance and Tax Committee, Senator Haridopolos to pursue changing the rule requiring the 3% increase in the assessed amount for properties with a SOH differential. We received no response from the Senator concerning this issue.

13. Affects of Amendment One (A1) Continued… We, in essence, asked the assessed value to remain the same if the market value stayed the same. Or, if the market value decreased, then the assessed value should decrease by the same percentage.

14. Letter to Senator Haridopolos from our Attorney, Tom Findley March 25, 2008 Senator Mike Haridopolos Florida Senate, District 26 322 Senate Office Building 404 South Monroe Street Tallahassee, Florida 32399-1100 Dear Senator Haridopolos: Thank you for meeting with Chris Jones and Greg Brown last week. Enclosed is a document that reflects their suggestions regarding the "recapture rule" and the Department of Revenue's ability to decline homestead exemptions when they dispute a property appraiser's submitted tax roll. If we can be of further assistance, please do not hesitate to call on us. Sincerely, Thomas M. Findley TMF\cc Enclosure cc: Mr. Chris Jones, Property Appraiser of Escambia County Mr. Greg Brown, Property Appraiser of Santa Rosa County J. Elliott Messer, Esq. Bob L. Harris, Esq.

15. A. REPEAL OF DOR RECAPTURE RULE I. Current Status: Department of Revenue Rule 12D-8.0062 currently provides that, even in years in which the fair market value declines, the assessed value of real property for ad valorem property tax purposes must be increased if the assessed value for Save Our Homes (SOH) purposes is less than fair market value. The rule specifically provides: 12D-8.0062 Assessments; Homestead; Limitations.... (5) Where the current year just value of an individual property exceeds the prior year assessed value, the property appraiser is required to increase the prior year’s assessed value by the lower of: (a) Three percent; or (b) The percentage change in the Consumer Price Index (CPI) for all urban consumers, U.S. City Average, all items 1967=100, or successor reports for the preceding calendar year as initially reported by the United States Department of Labor, Bureau of Labor Statistics. (6) If the percentage change in the Consumer Price Index (CPI) referenced in paragraph (5)(b) is negative, then the assessed value shall be the prior year’s assessed value decreased by that percentage.... II. Issue: The rule states that the property appraiser is “required” to increase the assessed value, even when the fair market value declines. Although subsection (6) of the rule allows for a reduction in the assessed value if the CPI is negative, it does not allow necessarily for a reduction in assessed value if the fair market value declines. In our view, the rule requiring an increase in assessed value, even in a declining real estate market, is not supported by the statute. Section 193.155(1) states only that any “change” resulting from a reassessment “shall not exceed” either 3% of the assessed value or the CPI, whichever is less. Yet, it does not “require” an increase of 3% in a declining market. The expectation of the public is that Amendment One and lower property values will equate to lower tax bills. Yet, with the “recapture” rule of the Department of Revenue, those potential tax savings stand to be wiped out or greatly reduced. Accordingly, we suggest the following statutory revision to avoid any misunderstanding. III. Suggested Statutory Revision: Add the underlined language: 193.155(1). Homestead assessments.-Homestead property shall be assessed at just value as of January 1, 1994. Property receiving the homestead exemption after January 1, 1994, shall be assessed at just value as of January 1 of the year in which the property receives the exemption. (1) Beginning in 1995, or the year following the year the property receives homestead exemption, whichever is later, the property shall be reassessed annually on January 1. Any change resulting from such reassessment shall not exceed the lower of the following: (a) Three percent of the assessed value of the property for the prior year; or (b) The percentage change in the Consumer Price Index for All Urban Consumers, U.S. City Average, all items 1967=100, or successor reports for the preceding calendar year as initially reported by the United States Department of labor, Bureau of Labor Statistics. If the just value has decreased from the prior year, the assessed value shall be decreased by the same percentage as the percentage decrease in just value. If there is no change in just value from a prior year, then there shall be no increase in assessed value. Enclosure to the letter from Tom Findley to Senator Haridopolos

16. Affects of Amendment One (A1) Continued… Therefore, because of the 3% increase in the homesteaded properties assessed value with a SOH differential, your tax relief may be somewhat less than the $153.51.

17. Affects of Amendment One (A1) Continued… The Santa Rosa County School Board’s tax portion increased this year on the Required Local Effort (RLE) as provided by the State of Florida. The state sets the RLE millage rate. Their millage rate increased by.297 mills. This will have an affect on your savings due to Amendment One if you have a SOH differential.

18. Affects of Amendment One (A1) Continued… Coupled with a higher millage rate on the state mandated School’s Required Local Effort and the possible 3% increase in your assessed value due to the SOH rule, your expected savings will be less or you could possibly see a tax increase.

19. Affects of Amendment One (A1) Continued… The following slides are intended to graphically display the affects of the increase in assessed value by the state’s rule and higher school millage rate:

20. Affects of Amendment One (A1) Continued… The next slide is a scale of the affects of increasing a homestead property’s assessed value by 3% with the additional $25,000 homestead exemption provided by Amendment One.

21. Assessed Value

22. Affects of Amendment One (A1) Continued… The next slide illustrates the affects of increasing the millage rate for the Schools’ Required Local Effort as mandated by the state.

23. Assessed Value

24. Affects of Amendment One (A1) Continued… The next slide illustrates the combination of the increase in the school millage rate and the 3% increase in assessed value on homesteaded properties with a SOH differential.

25. Blue depicts a tax decrease. Red depicts a tax increase. Assessed Value

26. Therefore, if your assessed value was between $50,000 and $228,965, then you received a proportional tax decrease. If your home’s value was outside of these assessed values then you received a tax increase due to the factors previously discussed.

27. Affects of Amendment One (A1) Continued… The next slide indicates the amount of savings you should expect if your home’s market and assessed value was the same as last year.

28. Assessed Value

29. The following table is an accumulation of the combined affects of the SOH 3% recapture rule, Amendment One, and the increase in the school’s Local Required Effort (LRE) on the proposed taxes for 2008.

31. Affects of Amendment One (A1) Continued… The following slides are an example of the increase in assessed value due to SOH, should you have a SOH differential accumulation over several years and the increase of the school’s millage rate.

32. Example of the affects of increased school’s RLE and 3% increase in SOH with Amendment One. 2007 Market Value$ 165,901 2007 Assessed Value$ 130,411 2008 Market Value$ 165,888 2008 Assessed Value$ 134,323 Change in assessed value of $ 3,912 was the 3% increase in SOH by state rule, even though the market value stayed almost the same.

33. Affects of Amendment One The following taxable values are based on the previous slide’s information: 2007 Taxable Value$ 105,411 2008 Taxable Value County$ 84,323 School$ 109,323 Other$ 84,323

34. Example Continued… Even though the market value slightly decreased, the assessed value increased due to the 3% requirement on the SOH amendment as required by rule from the State of Florida.

35. 2007 Assessed Value$ 130,411 Increase in SOH 3% recapture$ 3,912 2008 Assessed Value$ 134,323 County & NWFWM taxable value$ 84,323 School taxable value$ 109,323

36. Net Savings Savings Amendment One $ 152.38 ($ 25,000 x.0060953 = $ 152.38) 3% Increase in SOH -$ 53.05 ($ 3,912 x.00135603 = $ 53.05) School Millage Increase -$ 32.47 ($ 109,323 x.000297 = $ 32.47) 2008 Net overall Savings $ 66.86

37. Net Affect of Changes The combined affects of Amendment One, 3% increase in SOH assessed value, and the increase in School millage rate results in a net savings on this example of: $ 66.86 And not $153.51

38. Affects of Amendment One (A1) Continued… Should you have any questions concerning the affects of Amendment One or the Save Our Homes amendment, please contact our office.

39. End