Florida voters will get a chance to vote on swapping a third of their property tax bill for a penny increase in the sales tax -- and a promise that the Legislature will fill the a $5.4 billion hole in school funding in 2011 -- under a plan voted on by the Taxation and Budget Reform Commission on Monday.The panel, which has the power to put constitutional amendments directly before voters, voted 21-4 to place the proposal on the November ballot. It will eliminate an average of 33 percent of all property taxes in Miami-Dade County, 35 percent in Broward County and 25 percent statewide and replace it with a penny increase in the 6-cent sales tax.
But because the sales tax increase covers only a fraction of the lost revenue and the measure requires that school budgets not be cut, several business groups said they fear it could force the Legislature to adopt a services tax.
The proposal would abolish the portion of property taxes that pay for schools, called the Required Local Effort, by 2010. An estimated $9.3 billion portion of property taxes the state requires to pay for schools would be eliminated. School districts could continue to levy other property taxes if they have been approved by voters in the past.
But because the additional sales tax may make up only about $3.9 billion, the Legislature would have to come up with an estimated $5.4 billion in 2011 to pay for schools from a list of options that includes repealing sales tax exemptions, raising additional sales taxes, relying on growth or cutting spending.
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In a passionate appeal to the commission to approve the plan, House Speaker Marco Rubio told them the vote was a historic opportunity to address what he says is Florida's affordability crisis.
''You're our last hope because all you have to do is open a newspaper to realize we're not going to pass meaningful tax reform in the Florida Legislature,'' Rubio told them. ``I don't think anything you've ever done will be more important than what you do today. I hope you don't let it be an opportunity to pass you by.''
McKay, who worked unsuccessfully for years to get the Legislature to eliminate tax exemptions on what he considers special interest groups, echoed those comments. ''Unless we do something here today, probably nothing's going to be done,'' he told the panel. ``So it's up to you to give the voters of Florida this opportunity.''
But Commissioner Randy Miller, president of the Florida Retail Federation, argued vehemently against saying that by forcing such a deep cut without imposing new taxes on services.
''We're not doing anything here except changing who pays the bill,'' he said. He said that by eliminating the tax exemptions on businesses, legislators will only find $2.13 billion -- unless they move into household exemptions or start taxing services.
The commission made it more difficult for the Legislature to require school districts to raise property taxes once voters approve the amendment by reducing the maximum millage rate that school districts can levy from 10 mills to 5 mills.
The idea, by McKay, is to ``prevent a bait-and-switch from the Legislature or anybody else. We don't want the Legislature to come back after the people have voted on this . . . to relevy a required local effort.''