Taxes in Florida Medium-Sized Charter and Non-charter Counties

By
Wynn Teasleyand Donald Steacy
Whitman Center for Public Service
University of West Florida

The Florida Association of Court Clerks (FACC) published an often quoted pamphlet which showed that, for the fiscal year 1999, Florida counties with charter governments had higher tax burdens than non-charter counties. One problem with that broad brush report is that most of the larger counties are chartered, including two that are consolidations with the cities of Miami and Jacksonville. By analogy, that would be similar to saying that Escambia residents inside the City of Pensacola pay more taxes than residents outside the city’s limits. Nineteen counties in Florida are now chartered and they represent eighty per cent of the state’s population. So, the remaining twenty percent of Florida’s population resides in the 48 non-chartered counties. The charter counties in the FACC study had an average population size of 694,803 while the non-chartered counties had an average size of 83,415. That would be too much like comparing apples and oranges to produce valid results.

To counter this problem, we selected a sample of fourteen Florida counties with populations between 200,000 and 500,000 residents in the year 2000. So, they all fit within that medium-sized county category, with charter counties having an average size of 393,356 and the non-charter counties’ average size being 266,207. By 2000, half of those fourteen counties were chartered and half were non-chartered, which offered a good comparison. The seven chartered counties were Alachua, Brevard, Lee, Polk, Sarasota, Seminole, and Volusia. The seven non-chartered counties were Collier, Escambia, Lake, Leon, Manatee, Marion and Pasco. The two questions that we sought to answer were: 1) do charter counties have a higher tax burden than non-charter counties, and 2) do counties raise taxes after becoming chartered?

1. Do charter counties have a higher tax burden than non-charter counties?

To answer this question, we compared those fourteen counties—seven chartered and seven non-chartered—with regard to property taxes and total taxes per capita and the amount of taxes raised per thousand dollars of personal income during the decade from 1993 to 2002. Obviously, property taxes are just one type of tax a county may impose. It can also impose a sales tax and charter counties are authorized a utility tax, like chartered municipalities. Looking at the amount of taxes raised as a function of personal income reveals the tax burden on an ability-to-pay basis.

For eight of those ten years, the amount of property taxes raised was nearly identical. (See Figure One and Table One Attached) In the fiscal years 1999 and 2000, charter counties did raise more property taxes per capita, but in 2001 and 2002 non-charter counties charged a slightly higher rate. Residents in non-charter counties were charged an average of about five dollars more in property taxes per person than residents in charter counties in fiscal year 2002.

Figure One

Sources: Fla. Dept. of Financial Services and U.S. Bureau of the Census

The second indicator that we looked at (See Figure Two and Table Two) was the total taxes raised. Charter counties, unlike non-charter counties, can raise a public service or utility tax. While both types of counties have access to extra sales tax revenues, non-charter counties tend to make more use of this revenue source. Similar to the findings about property taxes, the total taxes raised per person was nearly identical for all years, with citizens in chartered counties paying only slightly more total taxes in the years 1999 and 2000. Apparently, the greater difference that was found for property taxes during those particular years was reduced somewhat in total taxes by other tax revenues being raised by non-charter counties. Again, except for the year 2000, there is almost no difference between charter and non-charter counties in total taxes raised per capita. Citizens in charter counties paid about two dollars more per person in total taxes in 2002.

Figure Two

Sources: Fla. Dept. of Financial Services and U.S. Bureau of the Census

Finally, we looked at tax burden as a function of total taxes raised per $1,000 of personal income. Figure Three (see Table Two) shows that during most of the years, citizens in non-charter counties paid more of their personal income in taxes, charter county residents paid more in 1999 and 2000, but there was no significant difference in the years 2001 and 2002. Non-charter county residents were charged about two cents more in total taxes from personal income in 2002.

Figure Three

Sources: Fla. Dept. of Financial Services and U.S. Bureau of the Census

The overall conclusion from this analysis of the last decade of county tax burdents in the fourteen charter and non-charter counties reviewed here is that it is a virtual dead heat. There is no significant difference between the taxes imposed on citizens in these charter and non-charter counties based on whether or not they were chartered. Perhaps the most striking observation from these figures is really how similar the trends were for both chartered and non-chartered counties of similar size during the last ten years.

2. Do counties raise taxes after adopting charter?

Even if chartered counties had no higher tax burdens than non-chartered counties, it is still reasonable to ask if citizens under charter government incurred tax increases immediately after adopting a charter. In order to answer this question, we looked at the seven chartered counties reviewed above during the time period five years before a county’s particular charter was adopted and five years afterwards. We examined the millage rates as well as the total operating taxes levied before and after charter was adopted. Those seven counties adopted charters over twenty-seven years ranging from 1971 (Sarasota and Volusia) to 1998 (Polk). Therefore, we adjusted all the dollar figures to 1993 constant dollars. Otherwise, when a county adopted a charter would have an impact on the total tax dollars raised in a given year based on variations of the dollar’s value or inflation. These charts show the year charter was adopted in the middle, -5 indicates the time period five years before charter was passed and +5 indicates the time period five years after charter was passed. The actual charter year, of course, varied between 1971 and 1998 and the mid-point on the graph (between –1 and +1) represents each charter county’s particular adoption date.

Figure Four (see Table Three Attached) shows that in these charter counties, millage rates were rising steadily before charter was passed as well as for the first year after charter was adopted. The millage rates for the first year after charter adoption was probably set by the previous non-charter county commission. Those millage rates had risen from less than six mills to nearly seven mills until charter was passed. In subsequent years after the passage of charter, however, the average millage rate for charter counties fell back to under six mills.

Figure Four

Source: Fla. Dept. of Revenue

The second indicator of charter government behavior with regard to taxes is reported in Figure Five (see Table Three Attached). The taxes levied could have actually increased even though millage rates decreased if the overall property assessments increased. This chart shows the trend in total operating taxes levied before and after charter in 1993 constant dollars adjusted for inflation. The results in Figure Five are consistent with the millage rates results reported previously. Specifically, taxes per capita increased steadily prior to the adoption of charter, but then they began declining after charter was adopted.

Figure Five

Sources: Fla. Dept. of Revenue and the U.S. Bureau of the Census

Conclusions

First, the results of this analysis show that there is currently no significant difference between the tax burdens found in the fourteen Florida charter and non-charter counties today and there was no significant difference over the last decade. In 2002, the average citizen in a non-charter county paid about five dollars more in property taxes, the average charter county resident was charged about two dollars more in total taxes, and there was only two cents difference in total taxes raised per thousand dollars of personal income. Moreover, the trend analysis of the last decade shows that for most of those ten years there was no discernable difference in average taxes paid by residents in chartered and non-chartered counties.

Second, the dramatic differences found in the FACC study were not found here. Studies based on only one fiscal year, e.g., 1999 or 2000, may yield a different picture if that year did not follow the general trend. We believe, however, that the main difference between the results of this study of medium-sized counties and those found in the previous study of all Florida counties is that the FACC compared the taxing and spending patterns of mainly large, urban counties (chartered) with mainly smaller rural counties (non-chartered).

Third, while there has been much concern voiced that once a county is chartered it would raise the tax burden on its citizens, the medium-sized charter counties studied here did not exhibit a pattern of raising the tax burden on their particular property owners and residents after the adoption of charter government. Rather, the average millage and tax rates rose consistently before charter was adopted and they subsequently declined during the five years after charter was implemented.

In sum, counties of comparable size apparently impose virtually identical tax burdens on their citizens without regard to whether their government is chartered or not, and those charter counties in this study tended to reduce the millage and tax rates after charter government was adopted. For them, charter government may have actually reduced rising local tax burdens, perhaps, by using more non-tax revenues or more revenues available from other levels of government.

3. Does Escambia County have a higher tax burden than other medium-sized counties?

A third question we ask is: How does the tax burden in Escambia compare with those of other medium-sized counties in Florida? Using the same data, we can compare the tax burden in Escambia with the other medium-sized counties. In this analysis, Escambia is viewed separately but it is still included with the other six non-charter counties. The data for all the charter and non-charter counties remain the same as reported in the first two figures (Tables One and Two) in this analysis.

Figure Six

Sources: Fl. Dept. of Financial Services and U.S. Bureau of Census

Figure Six simply shows that Escambia County collects fewer property taxes per capita than other medium-sized counties, whether they are chartered or not. This is likely the result of lower property values in this county that even having one of the highest millage rates cannot overcome.

Figure Seven

Sources: Fl. Dept. of Financial Services and U.S. Bureau of Census

Figure Seven reports similar data comparing the collection of total taxes in Escambia and in other medium-sized counties in Florida. What this figure shows is that Escambia, relying mainly on property taxes through 1993 still had lower total taxes per capita than its cohort counties in the State of Florida. Beginning in 1994, after additional sales taxes were approved by county voters, Escambia began to slightly exceed the average total taxes collected for the other counties, which it did in 2002 by a little more than ten dollars per person.

Figure Eight

Sources: Fl. Dept. of Financial Services and U.S. Bureau of Census

Figure Eight depicts the trends in total taxes collected per $1,000 dollars of personal income in the fourteen medium-sized Florida counties. What this chart illustrates is that when the extra sales taxes were collected in Escambia in 1994, the tax burden in Escambia county not only reached parity with its cohort counties, it markedly exceeded them for the remaining years in the decade in tax burden as a percentage of income.

Over that decade (1993 to 2002), Escambia County had a 98.6% increase in property taxes collected. That increase exceeded the average increase for both charter (75.2%) and non-charter (88.5%) counties. Correspondingly, the increased property taxes per capita for Escambia County was 78.9%, while the corresponding average increases in the other counties was 45.7% (charter counties) and 49.9% (non-charter counties). Perhaps one reason that the increase is greater per capita in Escambia is that the populations in the other counties grew more rapidly.

The additional sales tax adopted in Escambia County gave it the highest percentage increase in “other taxes” raised by the counties in this study, with a threefold increase. Resultingly, while the other counties’ total taxes per capita were increasing modestly at about fifty percent or about 5% per year, the increase in total taxes per capita in Escambia was 132.8% --more than double the rate of increase for the other counties on average, but most of that difference occurred with the sales tax increase in 1994.

The average total taxes collected per thousand dollars of personal income was about $14.64 on average for both charter and non-charter counties in 2002, it was $18.19 in Escambia. In 1993, Escambia had lower tax per income than the average for the other counties, but during the decade, Escambia’s increase in tax burden per dollar of income increased 74.2%, while the average increases for the other medium-sized counties was under ten percent. By 2002, Escambia was collecting more than 24% more in taxes out of every dollar of its residents’ personal income.

Conclusions:

Escambia County grew the least in population (about 11%) from 1993 to 2002 of the counties in this study. In addition, Escambia is, economically speaking, a relatively poor county in terms of both personal incomes and property values when compared with other similar size counties in Florida. These factors help explain why Escambia grew more in taxes per capita and taxes per dollar of personal income. In addition, Escambia added the highest rate of sales tax charges at 1.5 percent.

When relying predominantly on ad valorem taxes, Escambia has a lower property tax burden than the average for both charter or non-charter medium-sized counties in Florida. Once the extra sales tax revenues were added to Escambia County’s resources in 1994, however, it slightly exceeded the other medium-sized counties in Florida in total taxes per capita, and it exceeded them by a much larger percent in terms of ability to pay as a proportion of personal income. In that sense, Escambia County has a higher tax burden than the average for the other medium-sized Florida counties.

Table One

Property Taxes in Medium-sized Charter and Non-Charter Counties and Escambia Counties from 1993 to 2002

	1993	1994	1995	1996	1997	1998	1999	2000	2001	2002
Charter Counties
Alachua	176.94	187.04	197.92	206.43	214.02	218.48	230.75	243.28	268.36	283.40
Brevard	144.67	138.64	13.54	137.31	138.18	138.75	136.41	140.53	153.88	171.69
Lee	280.28	301.21	261.41	258.72	289.13	300.87	324.45	338.16	374.20	170.37
Polk	203.26	205.26	218.90	224.05	240.73	245.77	244.93	247.41	262.19	257.06
Sarasota	203.46	209.60	217.32	230.01	238.81	258.74	301.85	319.78	345.73	370.37
Seminole	173.66	173.11	174.98	181.81	189.94	197.50	201.73	210.79	224.12	237.31
Volusia	175.09	179.36	188.66	198.41	209.64	214.16	220.50	229.52	241.48	238.79
Non-Charter Counties
Collier	312.23	305.53	300.01	327.09	334.18	334.49>	357.89	386.81	489.89	556.00
Escambia	171.18	173.69	178.17	181.38	185.83	212.80	218.58	236.67	251.06	262.32
Lake	138.86	145.39	145.53	146.88	147.73	154.19	164.56	205.12	196.96	241.47
Leon	202.56	207.99	218.04	228.08	238.95	248.99	257.41	267.45	276.70	287.58
Manatee	281.70	289.64	262.48	311.56	319.08	333.58	347.34	368.71	405.11	466.11
Marion	142.75	138.46	130.83	143.92	159.29	166.03	174.89	184.33	198.37	211.29
Pasco	207.57	207.19	218.93	216.46	225.72	209.41	232.84	261.13	284.58	295.29

Property Taxes per Capita
	1993	1994	1995	1996	1997	1998	1999	2000	2001	2002
Charter	219.79	223.45	228.74	232.72	236.63	249.91	276.88	295.91	289.96	320.21
Non-Charter	217.16	226.41	228.47	231.85	238.89	245.93	252.48	266.74	292.64	325.49
Escambia	171.18	173.69	178.17	181.38	185.83	212.80	218.58	236.67	251.06	262.32

Sources: Florida Department of Financial Services and U.S. Bureau of the Census

Table Two

Other and Total Taxes per Capita and Income in Medium-sized Charter and Non-Charter Counties and Escambia County from 1993 to 2002

Other Taxes Per Capita
	1993	1994	1995	1996	1997	1998	1999	2000	2001	2002
Charter counties	69.60	74.85	78.32	83.50	83.57	89.98	53.59	82.16	105.68	95.97
Non-Charter Counties	58.76	78.06	84.67	89.51	91.48	93.96	72.03	99.43	100.72	88.87
Escambia	40.87	117.22	142.28	161.89	163.63	159.21	137.76	162.80	168.76	172.16
Total Taxes per capita
	1993	1994	1995	1996	1997	1998	1999	2000	2001	2002
Charter	289.39	298.29	307.06	316.21	320.20	339.90	330.47	378.08	395.54	416.19
Non-Charter	275.92	304.47	313.14	321.36	330.37	339.90	324.52	366.17	393.37	414.36
Escambia	183.79	290.72	322.26	338.03	341.98	344.35	348.39	384.74	410.09	427.83
Taxes Per $K Income
	1993	1994	1995	1996	1997	1998	1999	2000	2001	2002
Charter	14.04	13.90	13.73	13.55	13.08	13.18	12.63	13.82	14.19	14.63
Non-Charter	13.47	14.33	14.05	13.80	13.51	13.24	12.35	13.43	14.16	14.65
Escambia	10.44	16.15	17.33	17.07	16.68	16.24	16.05	17.02	17.78	18.19

Sources: Florida Department of Financial Services and U.S. Bureau of the Census

Table Three

Average Millage Rates Before and After Charter Passage in Seven Charter Counties with Populations between 200,000 and 500,000

Year Pre/Post Charter	-5	-4	-3	-2	-1	+1	+2	+3	+4	+5
Average Millage	5.631	5.937	6.220	6.379	6.608	6.688	6.934	6.599	5.723	5.968

Source: Florida Department of Revenue

Table Four

Total Taxes per Capita Before and After Charter Passage in Seven Charter Counties with Populations between 200,000 and 500,000 in Real 1993 $Dollars

	Year Before and After Charter Passage
County	-5	-4	-3	-2	-1	+1	+2	+3	+4	+5
Alachua	163.87	171.43	174.12	187.45	208.99	224.28	200.38	200.42	194.33	188.61
Brevard	159.27	162.48	157.31	151.50	141.81	135.44	134.04	129.91	128.82	125.07
Lee	297.75	290.86	303.04	257.39	249.08	269.21	276.76	291.62	296.72	320.26
Polk	205.27	212.32	212.76	221.43	223.67	217.92	215.20	224.10	230.84	232.00
Sarasota	186.07	197.11	225.55	238.89	243.22	247.03	241.95	216.53	189.58	178.51
Seminole	117.32	140.12	149.77	154.97	160.12	194.43	498.53	186.17	181.07	175.78
Volusia	84.27	82.23	104.87	124.94	130.36	135.65	119.01	133.95	163.57	152.49
Avg.	173.40	197.51	189.63	190.94	193.89	203.42	197.98	197.53	197.85	196.10

Sources: Florida Department of Revenue and U.S. Bureau of the Census