2016 Florida Legislature adjourns
TALLAHASSEE, Fla. — Friday, March 11, 2016 — 6:46 p.m. — For Florida Realtors, the 2016 session was as much about preserving and protecting homeownership as it was ensuring no new laws were passed that would disrupt your business.
Your Office of Public Policy focused on several key initiatives, including a reduction in the business rent tax — supported by the governor and the Florida House — allocations for affordable housing trust funds and monies to combat unlicensed real estate activity. Just as important, our lobbyists worked to ensure harmful legislation did not pass, such as a new homeowners' association disclosure that would have allowed buyers to cancel a transaction.
Although Florida Realtors, along with the House of Representatives and the governor, pushed for a dramatic reduction in the business rent tax, the Legislature went in a different direction — but a direction that will benefit homeowners, Realtors and public schools. Lawmakers allocated $428 million of state tax money to offset higher property taxes for schools. In addition to the large allocation for property taxes, the Legislature funded affordable housing at its highest level since 2007. Lawmakers also took steps to protect our profession by putting up a half million dollars to combat unlicensed real estate activity.
"As our economy strengthens, property values are increasing and that's wonderful," says Carrie O'Rourke, vice president of public policy for Florida Realtors. "However, higher property values result in higher property taxes, a portion of which pays for schools. We applaud the Florida Legislature for providing $428 million in the budget to lower everyone's property taxes, while at the same time supporting public schools.
"Of course, we're disappointed the business rent tax reduction didn't pass," she continues. "This tax costs small businesses $1.7 billion a year. Imagine how many jobs would be created if small business owners didn't pay a business rent tax? Still, the Legislature's actions to lower property taxes signal their appreciation of the importance of homeownership."
O'Rourke is confident the business rent tax issue will gain momentum next session. "The fact that the House included the initiative in its $1 billion tax package speaks to its widespread appeal. Plus, we are part of a strong business coalition committed to creating a vibrant and competitive business environment."
These are just a few provisions of the $82.3 billion state budget approved by the Legislature before it adjourned just moments ago.
Following is a recap of how real estate bills fared this session. Look for updates in the coming weeks on floridarealtors.org.
Among bills that passed, there are several notable victories for the industry, prospective buyers and property owners:
$500,000 to combat unlicensed real estate activity and possible savings for licensees. Licensees pay $5 into the unlicensed activity fund when they renew their licenses. Under HB 303 (Rep. Colleen Burton, R-Lakeland), this fee will be waived if the amount of funds collected exceeds what was spent in the previous two years.
$200.1 million to Sadowski Affordable Housing Trust Funds. This is the highest funding level in nine years. Lawmakers provided $135.5 million for rental assistance (State Housing Initiatives Partnership , or SHIP); $5 million for homelessness challenge grants; and $64.6 million for state housing programs, half of which will go to the State Apartment Incentive Loan (SAIL) program. Also, lawmakers appropriated monies from general revenue and other trust funds for several local housing initiatives: $4 million for homelessness programs around the state; $16 million for the Low-income Housing Energy Assistance Program; and $1 million for a variety of community development projects.
Statewide water policy. SB 552 (Sen. Charlie Dean, R-Inverness) was one of the first bills passed by the Legislature and signed into law. It's a complex bill that lays the foundation for a comprehensive water management program for the state. Several aspects of this 134-page bill align with Florida Realtors' view on how to preserve one of Florida's greatest natural assets: (1) protect and restore fresh water springs; (2) give the Department of Environmental Protection (DEP) oversight for scientifically-based water research programs; and (3) allow the DEP to oversee pollution control measures for Lake Okeechobee, the Caloosahatchee Estuary, and the St. Lucie River and Estuary. Separately, the state budget provides monies for other environmental projects: $159.7 million for Everglades restoration; $56.8 million for northern Everglades and estuaries protection; and $50 million for springs protection projects.
Tax exemptions for seniors, solar energy and first responders. Lawmakers passed three proposed constitutional amendments dealing with taxes that voters will consider in November 2016. HJR 1009 (Rep. Larry Metz, R-Groveland) would grant a property tax break for first responders disabled in the line of duty. HJR 193 (Rep. Ray Rodrigues, R-Fort Myers) would give commercial property owners a tax break on solar and renewable energy devices. And HJR 275 (Rep. Bryan Avila, R-Hialeah) would allow certain low-income senior property owners to keep their additional homestead exemption even though the value exceeds $250,000 due to improving market conditions.
New type of sinkhole insurance. Property owners in so-called "sinkhole alley," (Hillsborough, Hernando and Pasco counties), where coverage currently available only covers catastrophic loss, will be pleased to know protection against less severe damage may soon be available. SB 1274 (Sen. Jack Latvala, R-Clearwater) allows insurance companies to offer a new line of sinkhole insurance that covers damage considered less than catastrophic, such as sunken floors and cracked walls. Policyholders would be required to make repairs and not use an insurance payout for other expenses or purchases.
No new restrictions on vacation rentals. Florida Realtors successfully worked against several bills that would have allowed local governments to ban short-term rentals.
Want to challenge your property assessment? Take along a real estate representative. Property owners who disagree with the value placed on their property may challenge the assessment before their county's Value Adjustment Board (VAB). Currently, only an attorney or "agent" may represent the owner. HB 499 (Rep. Bryan Avila, R-Hialeah) expands the list of representatives to include a real estate appraiser or broker.
Faster lease approvals for members of the military. SB 184 (Sen. Aaron Bean, R-Jacksonville), a broad military/veterans affairs bill, took on a House amendment late in the session requiring landlords and condo/homeowners' associations to approve or deny a rental application submitted by active duty service personnel within seven days. If the application is denied, the prospective tenant must be told why. If the application is not processed within the seven-day period, the landlord and condo/homeowners' association must lease the unit to the service member.
FREC appointment. The Senate approved Gov. Rick Scott's appointment of 2011 Florida Realtors President Patti Fitzgerald to the Florida Real Estate Commission. Fitzgerald, broker associate/manager with Illustrated Properties in Jupiter, will serve a three-year term.
Bills that did not pass
Cap on estoppel certificate fees. Fierce opposition made it difficult to advance legislation that would have capped estoppel certificate fees. HB 203 (Rep. John Wood, R-Winter Haven) made it through all House committees and was poised for discussion on the floor. The Senate version, SB 722 (Sen. Kelli Stargel, R-Lakeland), died in committee.
Assignment-of-benefits reform. For four years, legislators have tried to curb property insurance fraud, overbilling and lawsuits when property owners allow repair contractors, such as water remediators, to file an insurance claim on their behalf. These abuses, according to insurance companies, drive up rates for all policyholders. Two bills were introduced this session. One pitted trial lawyers against insurance companies, and the other focused on kickbacks that water remediators pay to plumbers and other repairman. Both bills proved too controversial for this Legislature.
New homeowners' association disclosure. SB 1122 and HB 1375 would have required prospective buyers to receive a homeowners' association's governing documents within seven days of closing. The buyer would have been allowed to terminate the contract for purchase within three days after receipt of these documents. Both bills died in committee early in the session.
New renters insurance disclosure. SB 342 would have required two different leases for residential rentals: one lease when tenants are required to purchase a renter's insurance policy and the other when insurance is not required. SB 342 passed the Senate; its House companion, HB 237, died in committee.
Higher documentary stamp taxes. SB 660 and HB 735 sought to shift the cost of impact fees — paid by builders but often passed along to purchasers of new construction — to all property buyers in the form of higher documentary stamp taxes. If adopted by local governments, doc stamps could have jumped from 70 cents to $1 per $100 of value.
Use of local surtax for water restoration projects. Local governments are permitted to levy an infrastructure surtax to pay for a range of capital projects, such as land for public parks or energy-improvement loans for residential or commercial property. HB 995 and SB 346 would have allowed local governments to use proceeds from this surtax to dredge muck from bodies of water and restore them for public use.
Fair housing, anti-discrimination. Florida Realtors was one of 36 companies and organizations in favor of legislation to ban discrimination in the workplace and housing based on sexual orientation and gender identity. SB 120 and HB 45 died in committee.
Stricter penalties for crimes committed against real estate agents. With attacks against real estate agents on the rise, two bills were filed to stiffen the penalty for certain crimes committed against a real estate professional during property showings. HB 47 made it to the House floor, but its Senate companion, SB 214, stalled in committee, as legislators questioned why real estate licensees should be given the same protected status as law enforcement officers and sports referees, as currently allowed.
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