October 2015 consulting firm’s work led to recovery of $8.5 million in unpaid taxes, penalties and fines
Once again, Sarasota County Property Appraiser Bill Furst is working on plans to pinpoint homestead exemption fraud, he has informed the County Commission.
To that end, Furst requested — and received — commission support for the hiring of “a third-party auditor to assist in reviewing the validity of homestead exemptions.”
The commissioners voted unanimously on April 26 to approve two memoranda of understanding (MOUs) with the Property Appraiser’s Office. One MOU deals with consulting work regarding the county’s dependent districts and Municipal Service Taxing Units (MSTUs), an April 26 county staff memo to the commissioners explained.
The consultant’s compensation in each situation will be “based on the savings obtained for the County,” the April 26 memo added.
In 2015, the staff memo pointed out, Furst “entered into a similar agreement” with a firm. Through that initiative, the memo continued, $8,500,613 in the form of unpaid taxes, penalties and fines was recovered; 70% of that “was distributed to various taxing authorities,” including the county and its districts, the Sarasota County School Board, municipalities and Sarasota Memorial Hospital.
Moreover, Furst told the County Commission in June 2018 that, as a result of the earlier consulting agreement, his office had added more than $551 million to the tax rolls over the previous three-and-a-half years.
Just from October 2015 through May 2018, he added, liens resulting from the homestead investigations put property valued at $380,264,000 back on the tax rolls.
The MOU regarding the homestead exemptions explained that Article VII of the Florida Constitution and Chapters 196 and 193 of the Florida Statutes say the property appraiser “has the duty … to determine any year or years within the prior 10 years of the then-current tax year, persons who were not entitled to, but were granted, a tax exemption or assessment on their real property …”
“Upon such determination,” the MOU continued, the property appraiser “serves a notice of intent” to place a lien on the owner’s property “to recover the unpaid taxes,” plus a penalty representing 50% of the money that was due, and 15% interest per year on the unpaid taxes.
The commission action on the MOUs came as part of its approval of its April 26 Consent Agenda of routine business matters.
Furst pointed out in a March 9 letter to County Administrator Jonathan Lewis, “The goal of my office is and always has been to produce a fair and equitable tax roll for all taxpayers in Sarasota County. When most people think of a tax roll,” Furst continued, “they think of property values. However, fairness also extends to the administration of ad valorem tax exemptions,” such as the state’s homestead exemption program.
“For every exemption granted to a taxpayer,” Furst pointed out, “the balance of the property owners must pay an increased amount of taxes to make up for the exempted portion. As you are well aware,” he added in his email to Lewis, “budgets are not reduced when exemptions are granted; the burden of payment is merely shifted to other residential and commercial property owners.”
Under the terms proposed for this latest audit, Furst noted, the county would receive 76.5% of the recovered revenues — taxes, penalties and interest. The auditing firm would be paid 23.5% of the funds, “capped at a maximum of $25,000 per instance of satisfied homestead lien,” Furst wrote.
As an added benefit, he continued, “[O]ur new audit process will also seek to identify property owners that appear to qualify for a homestead exemption but have not made an application with my office. I plan on reaching out to those citizens to educate and assist them in applying for all exemption benefits they lawfully are entitled to receive.”
Furst also wrote that he would like the commission’s approval by June 1, “so we may begin this important work.”