By Carole Hawkins, Staff Writer
The real estate and home building community will have plenty of issues to track during this year's session of the Florida Legislature.
Lower commercial lease taxes, budget appropriations for affordable housing and water quality legislation this year rank as top issues impacting the industry.
Here's the breakdown:
Lower the sales tax on commercial leases
Gov. Rick Scott has said he wants lawmakers to cut the six percent sales tax charged to businesses that lease space.
Senate Bill 176 and HB 11 both deal with that issue. The first lowers the rate to five percent, while the second phases out the tax altogether in one percent increments per year, starting in 2015.
John Sebree, senior vice president of public policy for Florida Realtors, said the issue should be important in Northeast Florida.
"Across the border in Georgia they don't charge the sales taxes on rent for, say, a nail salon, or whatever it is," he said. "But in Florida they do."
Florida continues to be the only state that collects a sales tax on commercial rent, Sebree said.
A study shows keeping the tax would generate $1.99 billion in revenue in 2019, but eliminating it would create 184,500 new jobs.
Affordable housing
Real estate and building groups say they will push again to get money collected through documentary stamp taxes and designated for affordable housing to be used for its intended purpose instead of being diverted items unrelated to real estate.
Scott's proposed budget allocates $83 million for housing programs, even though the Sadowski Trust Fund, the recipient of tax monies that are dedicated to housing, will have revenues of $231 million this year, plus an estimated $60 million that was unused in 2013. The rest now goes into the general fund.
The money is supposed to be used to pay for such things as gap financing for apartments in low-income areas and for down payment assistance for first-time home buyers, said Greg Matovina, chairman of the Government Affairs Committee for the Northeast Florida Builders Association. In the early years of the program, the money was used as intended.
But when excess money was collected during the real estate boom years of the early 2000s, the surplus was swept into general revenue. The housing crash later turned off the money spigot altogether, and for several years the housing programs went unfunded, Matovina said.
Scott's office said, "Housing needs are being addressed for Florida families in the proposed budget," in part because of a big national settlement over mortgage and foreclosure abuses.
But Matovina said last year's National Mortgage Settlement only replaced the money that had been swept out of affordable housing in the 2013 budget. Since it was a one-time payment to the state, it has no bearing on this year's budget.
"The program was big for spurring on home sales — a buyer could maybe get $10,000 to $20,000 in down payment assistance," Matovina said. "Getting a down payment together is often a major barrier to entry for people looking to buying a house."
Water quality issues
Water quality issues will dominate this year's legislative session, though early proposals suggest Northeast Florida may not be targeted for change. But Matovina said the region should pay attention, anyway.
"There could be any number of ways that concern over water suddenly morphs from a restriction on septic tanks that doesn't affect our area into some other restriction that does affect our ability to build and develop houses," he said.
The Senate is pursuing $220 million in projects to restore historic water flows and reduce pollutants in South Florida after seasons of heavy rains caused damaging outflows from Lake Okeechobee into Florida's estuaries. That could shift into a broader proposal, though, once it hits the House.
House Majority Leader Rep. Steve Crisafulli, R-Merritt Island, said water project funding should include dealing with issues in the agriculture industry and with drinking-water sources. Problems facing Florida's freshwater springs and the Apalachicola River region in Florida's Panhandle should also be addressed, he said.