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Date of Issue: June 01, 2006

Tax relief possible for Island hotels, motels

Hotel and motel owners on Anna Maria Island got some welcome news May 24.

Speaking at a public meeting at the Holmes Beach City Hall, Manatee County Commissioner Jane von Hahmann said a legislative amendment by the 2006 Florida Legislature allows individual counties to enact legislation to defer property taxes for hotels and motels.

The law allows each county to designate its own "working waterfront" area where any deferment would apply, she added.

But it's only a deferment, she emphasized, and would apply only to hotels and motels that meet the state's definition, she said.

Still, it's better than the ever-increasing property tax bills the "mom-and-pop" motels on the Island have faced the past several years, tax bills that have forced many owners to convert to condominiums, von Hahmann noted.

"We can't survive without the tourist industry," she said. "But this is not the answer, it's only a band-aid for now."

Von Hahmann held the public meeting to show county commissioners there is support on the Island for tax deferment legislation. She'll now ask the county commission to support an ordinance that would create the "working waterfront" district and establish how long the deferment might last. Von Hahmann suggested a fixed-cap based against a specific year might be one solution in the ordinance.

"My goal is to maintain the Island character. I fear we are losing that, so developing this ordinance is worthwhile," even if it is only a temporary measure, she said.

Anna Maria Island Chamber of Commerce President Don Schroder, who is also president of the Citizens Against Runaway Taxtion group, urged the public to volunteer to work on the ordinance and provide input to the county commission.

Schroder agreed that tax deferment is not the answer and urged the public to write their elected representatives in the legislature supporting property appraisal and tax reform. The legislature is scheduled to take up the issue in its 2007 session.

But tax deferment is at least a start.

"We've made the first step in a long journey," Schroder said. Real tax and property appraisal reform can only come through the Florida Legislature.

And tax appraisal is the crux of the problem for Island hotel and motel owners.

Attorney Chuck Webb said the Manatee County Property Appraiser often uses the "comparable sales" method on Anna Maria Island to determine property value, instead of the income or "cost" approach as allowed by law.

That usually results in a "highest and best" use appraisal that compares a motel or hotel to a condominium, resulting in staggering increases in appraised value and subsequent taxes.

Webb urged hotel and motel owners to ask the PAO to use the income approach in valuing their property. They should provide the PAO with their income statements before they receive their TRIM (Truth in Millage) notices in August. While the PAO is supposed to ask for the statements before setting the value of a hotel or motel, owners should ensure the PAO gets the information as soon as possible.

And don't just blindly accept your tax bill, Webb said. He urged affected owners to appeal the TRIM notice to the value adjustment board and have their case heard before a special master.

While most hotel and motel owners in attendance welcomed the news on tax deferment, one owner noted that any legislation enacted by the county won't affect their upcoming tax bills in August. Those ad valorem taxes are for 2005, a year of inordinately high increases in property values.

"And we got walloped the year before that," said one motel owner.

Von Hahmann said she'll move as fast as possible to get the county commission rolling. "I'm hoping it can be done in six months, in time for next year's tax bills," she said.

She urged Islanders to attend the county commission session when the ordinance is addressed and show support.

Tourism, she noted, affects everyone on the Island.