SOHA challenges - Get something for nothing in Florida

Written by Priyanshu Adathakkar    Thursday, 28 February 2008
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According to an article titled “Florida Bust Spawns Vulture Culture” published in The Wall Street Journal Home buyers from around the U.S. and abroad are descending on Florida to buy condominiums that have suffered sharp price drops amid the housing glut, subprime-mortgage crisis and credit crunch.

In hard-hit Miami-Dade County, condos originally costing as much as $1.4 million at the peak of the market now sell in some cases for $840,000, a 40% drop and experts warn that prices could dip even further.

Wells Fargo & Co., the country’s second-largest mortgage lender, says it has identified more than 200 housing markets nationwide where the mortgage crisis has spread.

Florida has 33 at-risk markets, followed by Michigan and Virginia with 15 each, and Maryland and Ohio with 13 each

Among the other at-risk markets is Massachusetts whose state representative, Eric Turkington (D-Cape and Islands) has decided to Champion the cause of Massachusetts residents with second homes in Florida. Eric Turkington recently wrote Massachusetts state Attorney General Martha Coakley urging her to join other states' attorneys general in supporting a class action lawsuit protesting tax discrimination against out-of-state property owners in Florida.  

The lawsuit, Lanning et al v. Pilcher et al., questions the constitutionality of a "Save Our Homes Amendment" (SOHA) to the Florida constitution.

Althogh in 13 Massachusetts towns - including Barnstable, Tisbury, and Nantucket, which are in his district there is a residential exemption which reduces the taxable valuation of a taxpayer's primary residence by up to 20 percent of the average home value in the town  Mr. Turkington does not consider Florida's tax assessment cap for residents as similar to the residential exemption in his state. "The SOHA has some similarities with the 20 percent piece, but not a great deal," he told The Martha's Vineyard Times.

According to The Martha's Vineyard Times Tisbury voted to establish a residential exemption in 1988, which is given to town residents who qualify by filing an application and copies of documents showing proof of their residency. Last December the selectmen approved continuing the residential tax exemption at 20 percent.

In discussions about the exemption before their vote, the selectmen said they feel it helps year-round residents cope with the high cost of living on the Island.

When told that the Tisbury selectmen said they are in favor of a residential exemption as a way to help reduce the Island's high cost of living for year-round residents by shifting some of their tax burden to seasonal residents, Mr. Turkington said he agreed with them.

When asked Martha's Vineyard Times if he owns a home in Florida, Mr. Turkington said yes.

Lanning v Pilcher case was filed in February, 2007, on behalf of all non-residents of Florida who own second homes in the state, and then there is Bruner v Hartsfield case filed in November 2007, on behalf of all taxpayers who have become resident homesteaders within the last four years. 

Kania et al v. Nelson et al - Case Number 8:2008cv00057 Filed: January 11, 2008 Court: Florida Middle District Court (Tampa Federal) is filed by Illinois residents Kenneth and Dolores Kania who own property in St. Petersburg.  They have filed a federal lawsuit against Pinellas County and several county officials, challenging Save Our Homes. Mr. Kania is representing himself.

A fourth case, not yet filed, will be in behalf of all Florida homesteaders who purchased their residence in the last four years.

A fifth case, not yet filed, will provide a "Safe Harbor" for all non-residents and resident homesteaders, who may be potential members of one of the three above classes, that want to insure their right to recover excessive back taxes.

Attorney's Involved in SOHA challenges.

James G. Feiber, Jr.- Salter Feiber Murphy Hutson & Menet, P.A.     
Thomas T. Gallion, III -  Haskell Slaughter Young &  Gallion, LLC          
Douglas S. Lyons, Marsha Lyons - Lyons & Farrar                                                      
William C. Owen                                                
William Slaughter - Haskell Slaughter Young & Rediker, LLC           
 
A comment by a reader in Martha's Vineyard Times who calls people with second homes in Florida "Half-time residents" siad ".... Then when asked to fund the increase to the cost of full-time residents the half-timers whine & moan because they thought they could move to Florida and get something for nothing. Too bad."