by Mary Ellen Klas of the Miami Herald
Lawmakers have been trying to protect homeowners from being trapped by a 1990s law that was designed to save them from rising property taxes.

TALLAHASSEE - Florida lawmakers are scrambling to find an election-year fix to a law that was designed to help save people from skyrocketing property taxes but has instead made many of them financial prisoners in their own homes....

Across the state, Floridians are finding that they can't afford to move into a new home because of rising prices and property taxes -- a legacy of the red-hot real-estate market and the unintended consequence of a constitutional amendment called Save Our Homes.

The 1992 amendment caps the increases on assessed values on properties that qualify for homestead exemptions to a maximum of 3 percent a year. But the cap ends when you buy a new home. That means someone who pays taxes on $100,000 of assessed value, sells his home for $300,000 and buys a $400,000 home could pay four times as much in taxes.

So many people are increasingly stuck in the tax trap that officials from South Florida counties say it has suppressed new home sales and has led to a dramatic drop in the availability of resale homes. The answer, they say, is to allow people to carry their old taxable value to the new home and use it to lower their new property tax. The idea has spawned a new buzzword: portability.

Legislators are considering 11 different proposals for portability. House and Senate leaders say momentum is so strong voters are very likely to see some form of fix on the November ballot.

''Everyone has cleared the hurdle that relief is needed; the challenge will be, can we find a solution that doesn't exacerbate the problem?'' said Sen. Jeff Atwater, the North Palm Beach Republican who chairs the Senate committee crafting a compromise plan.

WANTS TO SELL

For Javier Noriega, a mortgage lender in Hollywood, the fix can't come soon enough. He is eager to sell the three-bedroom home he has owned for 10 years and move to something larger.

But when he found a four-bedroom home recently, the tax bill gave him sticker shock: his $1,800 in annual property taxes would have climbed to $11,900.

''At this point, I'm off the market,'' he said.

The story is repeated across the county, said Bob Wolf, director of government relations for Broward County Property Appraiser Lori Parrish, who supports the Legislature's efforts to let the tax cap travel with people.

''People say they have no more freedom in terms of real estate,'' he said. Save Our Homes ``was a wonderful idea, but the real estate market changed and now people are stuck in a tax trap.''

Wolf said that despite the loss in property taxes that a fix would create, Broward County officials support giving people the ability to transfer their Save Our Homes credits because ``it will open up a lot of entry-level housing.''

Since Broward is nearly built out and unable to sustain much more growth, unlocking the pent-up real estate demand would provide the county with revenue from additional home sales and ''be a wash'' in terms of lost taxes collected, he said.

But not everyone is convinced. Officials with the Florida League of Counties have predicted that absent some limits on how much tax credit people are able to take with them when they move, counties could lose tax revenue. Early estimates say the total cost of portability to counties across Florida could be as much as $2.5 billion a year.

$250 BILLION SAVINGS

State economists estimate that currently, Save Our Homes will deliver a total tax savings of $250 billion to homeowners statewide this year and will rise to $350 billion next year.

Atwater notes that if tax collections decline, the burden will continue to shift to commercial property owners and people who own homes that are not homestead property.

''We have to find the right balance,'' he said.

VARIOUS PLANS

Proposals range from a bill by Sen. Mike Haridopolos, a Melbourne Republican, and Rep. Carl Domino, a Jupiter Republican, who want to give homeowners pure portability, to a hybrid pushed by Miami-Dade County Commissioner Katy Sorenson.

They all require voter approval in the form of a state constitutional amendment. Atwater and his House counterparts said they expect the measure to require a local county referendum and to cap the amount of the tax credit.

Here's a hypothetical example of how the Haridopolos-Domino plan would work:

A home is worth $300,000 in today's market but, because of Save Our Homes, the owner pays taxes only on $150,000. The owner buys a home for $600,000. The new property tax bill would work this way: The buyer would be able to subtract $150,000 from the new home's assessed value. New taxable value: $450,000.

Subtract another $25,000 in homestead exemption and the tax bill would be based on an assessment of $425,000.

The real-life numbers would normally be lower, since assessed value for tax purposes is usually lower than the real market value.

Sorenson's proposal, sponsored by Rep. Marcello Llorente of Miami and Sen. Burt Saunders of Naples, both Republicans, would give similar benefits, but limit them and target them to elderly and low-income homeowners.

In Sorenson's plan, the new home would have to be in the same county as the old one; the market value of the new home must not be higher than the market value of the old one, and the new home can only be 10 percent larger in square footage than the old one. And a homeowner could get the tax break only once.

BIG IMPACT

Without the limitations, any portability proposal ''could have a significant impact on budgets for counties and cities,'' Sorenson said.

House Speaker Allan Bense said he is ready to consider an array of solutions to help homeowners carry their property tax credits when they move, as well as other ways to provide property tax relief.

''I think before the session is over, we'll craft something,'' he said.