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Thread: More Lawsuits Filed Over Florida Property Taxes

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    Default More Lawsuits Filed Over Florida Property Taxes

    The Walt Disney Company recently filed another wave of lawsuits over rising tax valuation of its properties in Orange County Florida.



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    I won't pretend that I understand all the legal issues being disputed by the Orange County Property Appraiser (OCPA) and Disney. The issues are now in the courts and the courts will settle the disputes. But here are some opinions I have about these disputes.

    I actually prefer that the disputes might be settled in court. The previous head of the OCPA stated he was reluctant to sue corporations like Disney, preferring instead to settle issues out of court. In a way that sounds good, but I wonder how many times there were backroom deals made between the appraiser and the corporations he was suppose to be appraising. At least if the Court issues a decision, the settlement will be a public record for everyone to see.

    If Disney thinks it might lose the court cases, I expect it will quickly seek relief from friendly members of the Florida legislature. Look no further than the interesting tax laws that Florida has enacted that have favored the Holy Land Experience theme park if you want to see what a sympathetic legislature might do.

    I find it ironic that Disney is suing the entities that establish the mill levies as well as OCPA. OPCA sets the appraisal values, but its Reedy Creek Improvement District, among others, that actually sets the tax rate for the Disney properties. RCID works independently of Disney, but everyone who can vote in RCID elections are tied directly to Disney. At one time I read there are less than 20 registered voters who are eligible to vote in RCID elections and every one is appointed or selected by Disney. So, Disney is sort of suing its own people.






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    Quote Originally Posted by wdrl View Post
    I find it ironic that Disney is suing the entities that establish the mill levies as well as OCPA. OPCA sets the appraisal values, but its Reedy Creek Improvement District, among others, that actually sets the tax rate for the Disney properties. RCID works independently of Disney, but everyone who can vote in RCID elections are tied directly to Disney. At one time I read there are less than 20 registered voters who are eligible to vote in RCID elections and every one is appointed or selected by Disney. So, Disney is sort of suing its own people.
    It's probably not the RCID taxes that they're upset about - they can set that to whatever they want. I don't have any experience with Florida property tax bills, but all the ones I've had in California and Arizona have about 10 different taxing authorities involved - city, county, water district, school district, fire district, community college district, what have you. Then there's any special assessments on top of that, for school bonds or whatever. And all of those are based on OCPA-set property values, at mill rates Disney doesn't control.

    Now, here's the problem I can see for them. It's hard to argue that the value of the property isn't going up when they keep increasing its sale price. As per-point prices go up, even for older resorts...well, clearly they think the resort is worth more. Good luck convincing the county that it, in fact, is not.
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    Property Tax isn't determined by the value of the property. The value of the property is determined by the required tax revenue.

    What is Orange doing that requires additional taxes? Building new schools? Fire halls? Adding police? Are they offering home owners relief at the expense of business?

    In Atlantic City, the Casinos fought their tax assessment and won rebates in the $100's of millions, pretty much bankrupting A.C.

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    Quote Originally Posted by KNWVIKING 2.0 View Post
    Property Tax isn't determined by the value of the property. The value of the property is determined by the required tax revenue.
    Depends where you are. California's Proposition 13 has basically set it so the property tax is solely determined by the value of the property at the last time it was sold. (Because there's a hard cap on the mill rate, and they can only reassess in certain specific circumstances - property transfer being the big one.)

    It looks like the issue here is that the new assessor is valuing theme park and resort property at a higher rate than it used to be. (It's not just Disney - Universal and Sea World are suing as well.) It's an interesting problem - how do you set a value on Epcot? It could be that he's arbitrarily setting the values too high, or that his predecessor was setting it too low.

    But with the DVC properties...well, the article says tax assessments have gone up 10% over the 3-year period from 2014 to 2016. VGF was $150/point on January 1, 2014, and $180/point on December 31, 2016 - an increase of 20%. AKV went from $150/pt to $160/pt in the same time period, a 6.7% increase. (Historical prices from dvcinfo.com; these are direct purchase prices, not resale.)
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    Quote Originally Posted by kazrak View Post
    Depends where you are. California's Proposition 13 has basically set it so the property tax is solely determined by the value of the property at the last time it was sold. (Because there's a hard cap on the mill rate, and they can only reassess in certain specific circumstances - property transfer being the big one.)
    So if I bought my home in 1965, my property value is locked in until I sell it?

    I bought my home in Jersey in 1990 and it had an assessed value and my property taxes were X cents per $100.00 assessment. My assessed value remained static for nearly 20 years but X cents became X + a + b + c .....

    About 5-8 years ago the city actually paid to have each home physically appraised - people went door to door inspecting, measuring, etc.

    While my property value nearly doubled, my X+ cents were cut way back to actually X-. End result is my - and most other - home owners saw a little reduction in rates. Flip side is every business in town was screaming bloody murder. Sounds like something similar is happening in Orange County.

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    Quote Originally Posted by KNWVIKING 2.0 View Post
    So if I bought my home in 1965, my property value is locked in until I sell it?
    That's exactly it, yes. (Except Prop 13 didn't take effect until 1978 and reset values to 1975 assessments.) Values can go up a max of 2% per year, no reassessment except on transfer or major construction. When we bought our current house in 2011, the property taxes almost doubled over what the previous owner paid.
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    Quote Originally Posted by kazrak View Post
    It's probably not the RCID taxes that they're upset about - they can set that to whatever they want. I don't have any experience with Florida property tax bills, but all the ones I've had in California and Arizona have about 10 different taxing authorities involved - city, county, water district, school district, fire district, community college district, what have you. Then there's any special assessments on top of that, for school bonds or whatever. And all of those are based on OCPA-set property values, at mill rates Disney doesn't control.

    Now, here's the problem I can see for them. It's hard to argue that the value of the property isn't going up when they keep increasing its sale price. As per-point prices go up, even for older resorts...well, clearly they think the resort is worth more. Good luck convincing the county that it, in fact, is not.
    I would think Disney is concerned about the RCID taxes. For example, in 2016 RCID's mill rate was $12.3993 per $1,000 assessed value. For a resort like Bay Lake Tower, RCID's taxes account for 46.87% of its total tax bill, which has a combined millage rate of $26.454 per $1,000.

    Of the 100s of tax authorities in Orange County, RCID has one of the highest millage rates in all of Orange County.






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