By Michael E. Miller
By Allie Conti
By David Villano
By Jose D. Duran
By Michael E. Miller
By Allie Conti
By Kyle Swenson
By Luther Campbell
Although the unreliability of the data hampered conclusions, a few points were clear:
* Owners of homes of modest value generally find themselves at a distinct disadvantage when they file tax appeals, especially if they represent themselves at a hearing.
* The tax appeals process is controlled by a close-knit group of professionals with longstanding ties whose actions are governed largely by their own discretion.
* The unwieldy nature of the system and the slipshod condition of the records guarantee that regulation of property tax appeals by the Metro Commission and the Property Appraisal Department is haphazard at best.
First, some background. For alert Florida property owners, 1994 was a watershed in property tax assessment appeals. It was the year before Amendment 10 went into effect, modifying the state constitution to prohibit county appraisers from making soaring adjustments to the value of Florida homes. As of July of this year, the assessed value of residential property in Florida can rise by only three percent annually, or by the cost of inflation as calculated by the Consumer Price Index, whichever is lower. This year the CPI measured 2.7 percent, so the value of a home as determined by county appraisers could increase by no more than 2.7 percent, regardless of the sporadic bursts of buying frenzy in certain segments of the local real estate market.
Amendment 10, which passed in 1992 under the rallying cry of "Save Our Homes," puts the brakes on escalating assessments. It ends an unhappy past of tax-bill whammies, assessments that sometimes doubled overnight, lopping household budgets and forcing some people to move out of neighborhoods where they'd lived for years, simply to escape the tax squeeze.
In effect, the amendment caps the assessed value of a home -- the amount the Property Appraisal Department decides a dwelling is worth for tax purposes. Under the new law, the cap remains in place until a house is resold, at which time the property is reassessed at full market value (usually the amount the house sells for, minus any broker's fees or closing costs, et cetera).
A homeowner didn't have to be a financial wizard to figure out that the lower his assessed value was when the cap went into effect, the lower his taxes would be from that year onward. So beginning in 1993, homeowners began appealing their property tax assessments like never before.
But homeowners weren't the only ones anticipating the advent of Amendment 10. The county also rushed to make certain that all homes were accurately assessed before the cap was clamped on. Neighborhoods where property values were known to have risen A South Beach, Miami Shores, and Miami's Morningside district, for instance A got a thorough look-see, to the chagrin of homeowners there. "Everybody's taxes were raised drastically," reports realtor Norah Schaefer, who works primarily in the area known as Miami's Upper East Side, which includes Morningside. "I had people that had paid maybe $1800 in taxes, and their bills went up to $3200, almost double. It was very, very shocking."
Last year 18,390 residential properties were appealed, more than a 50 percent increase over 1992. Joining the crush were cost-conscious celebrities such as Willy Chirino, who hired a tax consultant and got his tax bill trimmed by $7696.15. Other local notables had the same idea: Gloria and Emilio Estefan saved $6649.97 using a tax consultant. Multimillionaire entrepreneur Victor Posner had his tax burden lightened by $36,951.24. Thomas Kramer, the scandal-plagued German commodities trader turned South Beach developer, appealed three properties on Star Island and received a tax cut of at least $25,211.48. Even Carnival Cruise Lines CEO and Miami Heat owner Micky Arison took a shot at a reduction for his home in Bal Harbour. Arison, however, failed to score.
Not that the odds of winning a reduction were unfavorable. Special masters approved 6948 residential property appeals, or about 38 percent. But a savvy businessman like Arison should have realized that the real opportunity for tax reductions lay in commercial property. Those cases, involving large office buildings and sprawling strip malls, carried odds of one in two; appeals were approved more than half the time.
Special masters say it's no secret why homeowners and commercial property owners fared so differently at tax appeal hearings: The system is skewed.
"The average layman doesn't stand a chance," observes Special Master Alvin I. Siegel, an appraiser who has decided Dade tax appeal cases since 1979. "They don't know how to appeal an assessment. They look at [the tax notice they receive from the county], and they see that the house next door has a lower assessment. But they have no idea whether there's a difference in lot size, or a difference in the condition of the property."
Siegel says that last year he asked the Value Adjustment Board (VAB), which oversees the tax appeal hearings, to make provisions for long-time homeowners, many of them pensioners on fixed incomes, who had failed to present convincing appeals but were faced with large increases in their assessments and tax bills they couldn't pay. "When these people come before you, they're in tears, and all they do is tell you that they can't afford their taxes. They don't know what to say. I stuck my neck out and went before the VAB to try and fight this damn thing, and basically I think that's what put me on the spot." The board, he says, denied his request -- and didn't approve his application to serve as a special master for next year's round of hearings, despite his long record of serving the county.