the years, CED has completed more than $2.5 billion worth of apartments, most
aimed at lower-income workers and their families.
SAS complains that the Legislature's move to end the exemption would kill its housing-related programs, which include tutoring for residents' children and an initiative to identify homeless families able to transition into permanent housing.
"Without the ad valorem tax exemptions, SAS may be forced to cut these important programs," said Lori Trainer, a spokeswoman for the Winter Park-based nonprofit. Also, more apartment communities may be removed from the state's affordable-housing inventory, affecting some of Florida's more-vulnerable residents, such as single parents, teachers and hospitality workers, she said.
To obtain its federal tax exemption as a nonprofit, SAS has stated that it develops, owns and operates rental housing for tenants with no more than moderate incomes. SAS apartments do have some of the lowest rental rates in the region among comparable complexes, but they are not always the most affordable within a given area, according to an informal survey using rental data from the Apartment Association of Greater Orlando.
For instance, the Willow Tree Apartments complex near MetroWest in west Orlando was valued at $15 million last year on Orange County's property-tax books. But because of the exemption, the 384-unit property, completed in 1999 and owned by a limited-liability corporation affiliated with SAS, was taxed as though it were worth little more than a million-dollar home.
Its owners saved $286,589 in property taxes on that complex alone -- enough to shave rents by more than $60 a month on each unit. Yet about 1.5 miles away, Metro Place Apartments -- built about the same time as Willow Creek -- charges about $64 a month less for a two-bedroom unit than Willow Tree does, even though Metro Place does not get the tax break.
Meffert, Florida Housing Finance Corp.'s general counsel, said the exemption has given certain apartment owners a competitive advantage.
"There are areas where the market for apartments has plenty of capacity, and this has driven down the price of rentals," Meffert said, adding that the property-tax savings for a nonprofit owner is a "real competitive disadvantage" for nearby apartment complexes trying to match the nonprofit partnership's rents.
Local officials are eager for the state to restore the lost property-tax revenue.
Orange County Comptroller Martha Haynie said the exemption is similar to the reduced impact fees given to some developers when they build housing complexes, because in both cases they diminish the county's ability to provide residents with related public services. She said that, although Ginsburg is a close friend of hers, the apartments that he and others develop have an effect on county roads, schools, parks and other taxpayer-funded services.
"It seems to be the American way to get tax breaks and take advantage of opportunities," Haynie said. But local governments losing out on millions in property taxes, she added, "is a problem."
(c)2013 The Orlando Sentinel (Orlando, Fla.)
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