1. PROPERTY TAX REFORM UPDATE March 27, 2007

2. Property Tax Reform January 30, 2007 BCC Meeting Tax Reform Proposals Fishkind & Associates Orange County Budget County Staff Efforts Summary

3. Property Tax Reform January 30, 2007 BCC Meeting Tax Reform Proposals Fishkind & Associates Orange County Budget County Staff Efforts Summary

4. January 30, 2007 BCC Meeting Presented Reform Proposals –“Save Our Homes” Portability –Double Homestead Exemption –Revenue/Expenditure Caps Possible 5-yr Fiscal Impacts of those Proposals: approx - $776 Million

5. Property Tax Reform January 30, 2007 BCC Meeting Tax Reform Proposals Fishkind & Associates Orange County Budget County Staff Efforts Summary

6. Tax Reform Proposals Governor’s Plan

7. Tax Reform Proposals Governor’s Proposals –Make “Save Our Homes” Benefit Portable –Double Homestead Exemption & Index to Inflation –Cap Assessed Value Increases to 3% Annually for ALL Properties –Exempt First $25,000 of Tangible Property from Taxation

8. Tax Reform Proposals Governor’s Proposals –“Save Our Homes” Portability Grant the Ability to Transfer an Existing “Save Our Homes” Benefit to a New Property Tax Rolls Would Grow at a Progressively Slower Rate Orange County Would Lose approximately $79 Million in Tax Revenues Over the Next 5 Years

9. Tax Reform Proposals Governor’s Proposals –Double the Homestead Exemption to $50,000 & Index to Inflation Would Reduce Orange County’s Budget by approximately $40 Million Over 5 Years the Impact is approximately $200 Million

10. Tax Reform Proposals Governor’s Proposals –3% Assessed Value Cap for ALL Properties Aims to Provide Tax Breaks to All Property Owners Including Large Corporations Impact of approximately $892 Million to Orange County Over Next 5 Years

11. Tax Reform Proposals Governor’s Proposals –5 Year Impact of Governor’s Proposals Small Business Exemption$ 5 Million Full Portability$ 79 Million Double Homestead Exemption$200 Million 3% Assessed Value Cap $892 Million Total Approximately$1.2 Billion

12. Tax Reform Proposals House Plan

13. Tax Reform Proposals House Proposal –Phase I Roll Back Millage Rates to 2004 Plus CPI and New Construction Cap Future Annual Property Tax Growth to CPI and New Construction - Requires unanimous vote to change - Revenue Sharing Implications Provide a $25,000 Exemption on Tangible Personal Property Taxes for Businesses

14. Tax Reform Proposals House Proposal –Phase II – Two Components 1)Replace State Imposed School Property Taxes (Required Local Effort) on Homesteaded Property with 1 Cent Sales Tax Increase 2)By 2010, Countywide Referendum Must be Held to Give Residents the Choice to Replace All Remaining Homestead Property Taxes with up to an Additional 1.5 Cent Sales Tax Increase 0.5 Cent for School Taxes 1 Cent for County, Municipalities, & Special Districts

15. Tax Reform Proposals House Proposal –Fiscal Impact – Phase I »Approximately $130 Million –Fiscal Impact – Phase II »No Impact First Year

16. Tax Reform Proposals Historical Growth: Property Tax Revenue Compared to Sales Tax Revenue (Adjusted for Article V)

17. Tax Reform Proposals House Proposal –“If local governments don’t embrace it [the house proposal], they could face much harsher changes.” –House Speaker Marco Rubio Orlando Sentinel - March 15, 2007

18. Tax Reform Proposals Senate Plan ?

19. Tax Reform Proposals Senate Proposal –A Plan is Expected in the Coming Weeks –“There is no support in the Senate for increasing the state’s sales tax, effectively declaring the measure dead in that chamber” –Orlando Sentinel – March 21, 2007

20. Property Tax Reform January 30, 2007 BCC Meeting Tax Reform Proposals Fishkind & Associates Orange County Budget County Staff Efforts Summary

21. Fishkind & Associates Counties have Experienced Major Cost Increases for: Fuel Health Insurance Property Insurance Pensions Constitutional Officers (Courts, Sheriff, etc)

22. Fishkind & Associates A Majority of Additional Ad Valorem Revenue in Counties has been Spent on Public Safety Spending Growth in Other Areas Attributed to Inflation & Population Growth

23. Fishkind & Associates No Evidence of Large Increases in Staff No Evidence of Extravagant Spending

24. Fishkind & Associates Cost of Government: Budget per Capita

25. Fishkind & Associates County Employees per 1,000 Population

26. Property Tax Reform January 30, 2007 BCC Meeting Tax Reform Proposals Fishkind & Associates Orange County Budget County Staff Efforts Summary

27. Orange County Budget Preparation of Two-Year Budget is Continuing –Departments are Preparing for Budget Cuts –Letters Sent to Constitutional Officers and Outside Agencies Regarding Possible Funding Cuts –Final Decision on Budget Adjustments is Pending

28. Property Tax Reform January 30, 2007 BCC Meeting Tax Reform Proposals Fishkind & Associates Orange County Budget County Staff Efforts Summary

29. County Staff Efforts Taking a Proactive Approach: –Analyzing Proposals Determining the Impact of Tax Reform Proposals as they are Received –Discussions with Stakeholders Florida Association of Counties Florida League of Cities Orange County Council of Mayors Standing Meeting with Orange County Cities

30. County Staff Efforts Taking a Proactive Approach Contd: –Delivering Informative Presentations West Orange Chamber of Commerce Central Florida Hotel & Lodging Association Police Benevolent Association Orange County Sheriff’s Office Various Orange County Departments

31. Property Tax Reform January 30, 2007 BCC Meeting Tax Reform Proposals Fishkind & Associates Orange County Budget County Staff Efforts Summary

32. Current Proposals will have a Significant Impact on Orange County –Budget must be Balanced –Level of Service will be Reduced in Certain Areas Staff will Continue to Monitor All New Developments

33. IMPACTS OF PROPERTY TAX REFORM March 27, 2007

34. Fishkind & Associates Average Annual Budget Increase: 2002-2007 –Orange County (Total Countywide): 2.2% –State of Florida: 10.5%