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HomeMy WebLinkAboutM-83-00330 0 December 13, 1982 Mr. Howard V. Gary city wrr.ager City of Mitzi commission City Hall 3cn0 ran American Drive Uiami, r1crlda 33I?: Dear Mr. Gary: CITY MANAGER'S OFFICE 1983 JAN -5 ply 12: 50 Mould you please schedule me for a personal appearance at the Y.t.ar�i C!.ty Cotes Acsion seeting on lanur•ry 13, !?-e?. I am president of WorOxiestern Meat, Inc., and I will request ar up%!ted planning •tud of the Allapattah eommorcial/industrial area. Th you for your atte tion to this matter. spectf y submitted El V4� o Nunes / Northwestern Meat, X�c. 2100 N.W. 23rd. Street Miami, Florida 33142 . e 83-33 a 7CItY OF MIAMI, FLORIDA INTER -OFFICE MEMORANDUM TO Howard Gary, City Manager DATE December 28 ]982 FILE Att. Jack Eads SUBJECT 1 FROM Maurice A. Ferre, Mayor � REFERENCES ENCLOSURES Please schedule Mr. Martin Fine to appear before the City of Miami Commission at our meeting of January 13, 1982. Mr. Fine wishes to speak on a proposed Housing Finance Plan to be presented to the Florida Legislature this -upcoming session. A PROPOSED NOYSIN` l7NANCE PLAN PRESENTED 70 THE FLORIDA LEGISLATURE 83-33 4k id The message is clears but WHO WILL LISTEN? A Proposed Housing Finance Plan Presented to the Florida Legislature MARTIN FINE Miami, Florida November 1982 8 3-L"; 3 THE PROBLEM The great questions that disturb the peace and well-being of man are not about ends, but means. There is little question that the providing of affordable housing for families with low and moderate incomes is an important and, noteworthy goal. However, there is tar less agreement as w means of achieving this goal. Because inflation has hit our cities and counties just as it has our households, the methods by which we can fund the real needs of our society in these difficult economic times is a matter of mounting national concern. Notwithstanding federal and state legislation which has provided substantial federal funding during the past forty-five years,. cities and counties throughout Florida still contain vast areas of slum housing and deteriorating neighborhoods. These are the "homes" of thousands of hopeless and frustrated citizens as well as the breeding grounds of crime and delinquency. The urgent need to provide affordable housing for families with low and moderate income in Dade County as well as in many other counties in Florida cannot be achieved without a plan for creative and fiscally sound financing on a continuing basis. The message is clear, but who will listen? 83-33 11 5 4; i THE HISTORY In 1937 the Congress of the United States passed housing legislation to assist low income families. Thereafter, the State of Florida adopted implementing legislation to permit the cities and counties of Florida to participate in various public housing, urban renewal and community development programs. In 1949 the Congress of the United States declared that the goal for its housing legislation of that year was to provide "a decent home in a suitable living environment for every American family." That admirable but elusive goal has not yet been achieved, nor does there exist any reasonable likelihood that it will be attained in the near future. In November, 1970? Ray Goode, then County Manager, issued a challenge to the community at the annual meeting of the Community Relations Board, entitled "Who Will Blow the Trumpet for the County's Ill Housed?" It was a clear and unequivocal message that this community could not afford to allow a substantial portion of its citizens to live in slum and blighted housing. Shortly thereafter, a community -wide committee was formed under the auspices of the Urban Coalition to respond to the challenge. It was composed of influential citizens, builders, representatives of the banking industry and others from all segments of the community. In May, 1971, it -2- SO—"2 3 4 4. rendered its report which called for "the production in the next two years of 10#000 units of subsidized housing that are safe, sanitary and decent and located in suitable neighborhood environments." During the past eleven years, the greatest part of which was a period of substantial economic and social progress, only approximately 25% of the goal has been met. Although our political leaders and the chief administrative officers of the city and county have been committed to providing decent housing, the goal set in 1971 has not and cannot be met under present funding limitations. The State of Florida does not presently provide funds to the cities and counties for housing programs. In 1981, however, the Legislature did create a Housing Finance Agency for the purpose of selling tax exempt bonds and making loans available to builders and developers for the construction of low and/or moderate income housing. The Housing Finance Agency recently sold one issue of bonds in the amount of $150,000,000. These funds were made available to the consumer at 13-1/28. It is apparent that even at this rate of interest, which is lower than most conventional financing now available, it is not possible for low income or most middle income families to afford to purchase homes. In the past, local communities could reasonably expect to receive some funds from Washington with which to carry out -3- their various housing programs. However, sufficient funds received in a timely and continous basis have never really been available to properly deal with the problems of redeveloping the slums and blighted areas of this or any other community in our country. The current administration in Washington is committed to a drastic reduction in the level of funding to local communities for housing and other purposes. This change in the role of the .federal government will compound the problems already faced by cities and counties throughout the country in the area of housing and community development. As stated earlier, there is no dispute that the goal of providing decent housing is a vital one, the issue is, and has always been, the means to provide the funds for achieving such an end. ONE PROPOSED SOLUTION One proposal which this writer has advanced during the past several legislative sessions is a local option that will permit counties to levy an additional excise tax on documents relating to real estate and retain the additional funds in the county in which it is collected. At the present time, the State of Florida levies an excise tax on all real estate transactions which is collected by the sixty-seven counties and turned over to the State, less a minor fee for the cost of -4- 83-" 3 4 a collection& to the calendar year ending December 30, 19801, Dade County collected $37,841,000 from this source. The Bill, which is attached as Exhibit A, was last introduced in the Legislative session of 1981, in a slightly modified form. The House passed it and it was passed by two committees of the Senate, but languished in that body and died. in the last remaining days of the session. The present proposal calls for a one-time payment of an additional excise tax on all real estate transactions, excluding single family residences, condominiums and coopera- tives. The Bill would be particularly effective in capturing revenue from previously untapped sources since a great many of the purchasers of land and improved real estate are "off -shore" entities or persons, which pay no federal or state corporate income tax. The funds could be used to acquire land for redevelopment purposes and for the construction of homes and/or apartments in the slum and blighted areas of the community. These funds could also be made available to families which require assistance in acquiring new and/or existing single family homes under existing programs presently being implemented by the City of Miami and Dade County. Both of these governmental agencies have successfully carried out home -ownership assistance programs on a limited basis and have "hands-on experience" in this area. -5- so-."]:3 4 a The enormity and importance of the redevelopment process will require a great deal of effort and cooperation between the public and private sectors. It would provide Miami and other communities throughout the State with a unique opportunity to establish various forms of creative partnerships between public agencies and those in the private sector engaged in the construction industry such as builders, savings and loan associations, mortgage bankers, commercial banks, realtors and others. Miami has been fortunate in being able to establish many such relationships between public and private sectors during the past several years and, as a result, the City has a base upon which to continue and broaden such relationships. An important benefit of this cooperation would be the possibility of "leveraging" public funds through participation in private sector lending institutions resulting in a more effective use of public funds. Indispensable partners in this venture are the community based organizations and institutions which already exist in the neighborhoods. Their participation could guarantee that local residents will be involved in the redevelopment process. This proposal is not only simple and fair, but it is also financially sound. It does not require a new or expanded bureaucracy for its implementation. It recognizes that local communities must develop new sources of funds for housing and community development programs. Once passed by the -6- 83--3 3 4' 4 Legislature, its implementation can be carried out by the County Commission, without any approval from Washington. It will, however, require political courage and leadership for the Legislature to articulate the realities of the situation and pass the attached Bill to initiate the program. In an era of unprecedented interest rates, the opportunity to obtain funds at no interest cost on a continuing basis is one that should not be lost. In Dade County alone it is estimated that the doubling of the present excise tax, exclusive of single family housing, would produce approximately $25400000 a year. The Florida Legislature must recognize that a means of financing local housing programs other than by obtaining funds from Washington and/or borrowing at high rates of interest must be found. Since=this proposal would permit each Florida county the option of determining if it wants to participate in the proposed program, local implementation and control would be paramount. It is this author's hope that the attached proposal will be a significant means with which our community and others throughout the State, who wish to do so, can set out again to achieve the goal of decent housing for all citizens. All I ask is that people take the time to listen to it and consider its potential. 83-33 1 a a SUMMARY OF PROPOSAL * ONE-TIME ADDITIONAL EXCISE_ TAX ON REAL ESTATE TRANSACTIONS OTHER THAN SINGLE FAMILY HOUSING WHICH IS TO BE RETAINED BY THE COLLECTING COUNTY * LOCAL OPTION - EACH OF FLORIDA'S 67 COUNTIES CAN DETERMINE IF IT WANTS TO IMPLEMENT THE PROGRAM * FISCAL SOUNDNESS -THE PROGRAM PROVIDES A CONTINUOUS SOURCE OF INTEREST -FREE FUNDS * NO EXTRA COST - NO NEW ADMINISTRATIVE AGENCY OR EXTRA PERSONNEL ARE REQUIRED TO CARRY OUT THE COLLECTION OF THE FUNDS. EXISTING HOUSING AND COMMUNITY DEVELOPMENT AGENCIES CAN IMPLEMENT THE PROGRAM * PUBLIC 6 PRIVATE SECTOR COOPERATION - LOCAL GOVERNMENT AGENCIES CAN WORK WITH THE PRIVATE SECTOR, BOTH IN THE CONSTRUCTION AND FINANCING OF THE MUCH NEEDED HOUSING * RESPONSIVE TO PRESENT REAGAN'S REQUEST THAT STATE AND LOCAL COMMUNITIES ASSUME A GREATER SHARE OF THEIR LOCAL HOUSING AND COMMUNITY DEVELOPMENT NEEDS -8- PROPOSED BILL A bill to be entitled An act relating to excise tax on documents; creating s. 125.0167, Florida Statutes; authorizing each county to levy a discretionary surtax for home ownership and rental assistance purposes; providing limitations and procedures; creating s. 201.031, Florida Statutes; providing for the levy of the surtax; providing for the administration, collection, and distribution of the proceeds of the surtax for home ownership or rental assistance programs; requiring an annual report to the Department of Banking and Finance; providing an effective date. Be It Enacted by the Legislature of the State of Florida: Section 1. Section 125.0167, Florida Statutes, is created to read: 125.0167 Discretionary surtax on documents; adoption; application of revenue. -- (EXHIBIT "A") excise tax on 8 1i Z' 3 4 0 (2) The department of )revenue shall pay all taxes collected under this section to the governing authority of the county which levies the surtax for deposit into the home Ownership and Renters' Assistance Loan Trust Fund of the county. The funds may be used for any purposes for which funds deposited in the trust funds of the county may be used as provided in s. 125.0167(3), and also may be used to pay the cost of collecting and enforcing the tax levied under this section. (3) Each county levying the surtax shall submit, in its financial report to the Department of Banking and Finance as required under s. 216.32, information showing the revenues and the expenses of the fund. Section 3. This act shall take effect July 1, 1983. -4- 813 3