The purpose of the amendment to Rule 12D-8.0063, F.A.C., is to implement the provisions of Chapter 2006-311, Laws of Florida, providing a method for assessment of changes to homestead property damaged or destroyed by misfortune or calamity.

DEPARTMENT OF REVENUE
Property Tax Administration Program

RULE NO: RULE TITLE
12D-8.0063: Assessment of Changes, Additions, or Improvements to a Homestead
PURPOSE AND EFFECT: The purpose of the amendment to Rule 12D-8.0063, F.A.C., is to implement the provisions of Chapter 2006-311, Laws of Florida, providing a method for assessment of changes to homestead property damaged or destroyed by misfortune or calamity.
SUMMARY: The amendment to Rule 12D-8.0063, F.A.C., provides that changes, additions or improvements to homestead property do not include repair or replacement of property damaged by misfortune or calamity that does not cause the total square footage to exceed 1500 square feet or 110 percent of the original square footage of the property where the repair or replacement is made within 3 years after January 1 following the year of damage or destruction. Provides that the just value of the portion that exceeds 1500 square feet or 110 percent is treated as a change, addition or improvement and is added to the assessed value of the homestead as of January 1 of the year following completion of the repair or replacement. Provides special rules for damage from named storms of 2004. Provides the assessed value of damaged or destroyed homestead property not repaired or replaced is reduced by the just value of the property not repaired or replaced. Provides that the provisions of this rule applicable to damaged or destroyed property also apply where the owner of property at the time of damage or destruction, permanently resided on the property, was not entitled to homestead exemption for that year, but applied for and received homestead exemption on the property the following year.
SUMMARY OF STATEMENT OF ESTIMATED REGULATORY COSTS: No Statement of Estimated Regulatory Cost was prepared.
Any person who wishes to provide information regarding a statement of estimated regulatory costs, or provide a proposal for a lower cost regulatory alternative must do so in writing within 21 days of this notice.
SPECIFIC AUTHORITY: 195.027(1), 213.06(1) FS.
LAW IMPLEMENTED: 192.042, 193.011, 193.023, 193.155, 193.1551, 213.05 FS.
A HEARING WILL BE HELD AT THE DATE, TIME AND PLACE SHOWN BELOW:
DATE AND TIME: Monday, September 17, 2007, 9:30 a.m.
PLACE: Room 143, Larson Building, 200 E. Gaines Street, Tallahassee, Florida
Pursuant to the provisions of the Americans with Disabilities Act, any person requiring special accommodations to participate in this workshop/meeting is asked to advise the agency at least 48 hours before the workshop/meeting by contacting: Larry Green, [phone]. If you are hearing or speech impaired, please contact the agency using the Florida Relay Service, 1(800)955-8771 (TDD) or 1(800)955-8770 (Voice).
THE PERSON TO BE CONTACTED REGARDING THE PROPOSED RULE IS: Sharon Gallops, Property Tax Technical Unit, Department of Revenue, 725 S. Calhoun St., Tallahassee, Florida 32399-0100, telephone [phone], e-mail address [e-mail]

THE FULL TEXT OF THE PROPOSED RULE IS:

12D-8.0063 Assessment of Changes, Additions, or Improvements to a Homestead.

(1) through (2) No change.

(3) General rules for assessment of changes, additions, or improvements; see paragraphs (a) through (d); for special rules for 2004 named storms see paragraph (e).

(a) Changes, additions, or improvements do not include replacement of a portion of homestead real property damaged or destroyed by misfortune or calamity when:

1.a. The square footage of the property as repaired or replaced does not cause the total square footage to exceed 1500 square feet, or

b. The square footage of the property as repaired or replaced does not exceed 110 percent of the square footage of the property before the damage or destruction; and

2. The changes, additions, or improvements are commenced within 3 years after the January 1 following the damage or destruction the just value of the damaged or destroyed portion as replaced is not more than 125 percent of the just value of the damaged or destroyed portion. The replacement just value in excess of 125 percent shall be treated as a change, addition, or improvement and added to the assessed value (including the assessment limitation change) of the homestead as of January 1 of the year following the substantial completion of the replacement of the damaged or destroyed portion.

(b) When the repair or replacement of such properties results in square footage greater than 1500 square feet or otherwise greater than 110 percent of the square footage before the damage, such repair or replacement shall be treated as a change, addition, or improvement. The homestead property’s just value shall be increased by the just value of that portion of the changed or improved property in excess of 1500 square feet or in excess of 110 percent of the square footage of the property before the damage, and that just value shall be added to the assessed value (including the assessment limitation change) of the homestead as of January 1 of the year following the substantial completion of the replacement of the damaged or destroyed portion. In lieu of the formula in paragraph (a) and subsection (4),changes

(c) Changes additions or improvements to homestead property rendered uninhabitable in one or more of the named 2004 storms is limited to the square footage exceeding 110 percent of the homestead property’s total square footage. However, such Such homestead properties with 1350 or less square feet which are rebuilt up to 1500 total square feet are not considered changes, additions or improvements subject to assessment at just value.This paragraph shall apply to such homestead properties for which repairs are completed by January 1, 2008 and applies retroactively to January 1, 2005. See chapter 2005-268, Laws of Florida.

(d) These provisions apply to changes, additions or improvements commenced within 3 years after January 1 following the damage or destruction of the homestead and apply retroactively to January 1, 2006.

(e) Assessment of certain homestead property damaged in 2004 named storms. – Notwithstanding the provisions of Section 193.155(4), F.A.C., the assessment at just value for changes, additions, or improvements to homestead property rendered uninhabitable in one or more of the named storms of 2004 shall be limited to the square footage exceeding 110 percent of the homestead property’s total square footage. Additionally, homes having square footage of 1,350 square feet or less which were rendered uninhabitable may rebuild up to 1,500 total square feet and the increase in square footage shall not be considered as a change, an addition, or an improvement that is subject to assessment at just value. The provisions of this paragraph are limited to homestead properties in which repairs are commenced by January 1, 2008, and apply retroactively to January 1, 2005.

(4) The replacement just value in excess of 125 percent, for purposes of this section, shall be measured directly by considering mass data collected, market evidence, and cost, or computed as follows:

(a) Determine the just value of the total homestead property prior to damage or destruction.

Example: Just value = $100,000 and assessed value = $80,000;

(b) Attribute a just value to the damaged or destroyed portion of the homestead property.

Example: $10,000 (the just value of the remaining property including land is $90,000);

(c) Compute the replacement just value that will be treated as not a change, addition, or improvement, by multiplying the amount determined under paragraph (b) by 125 percent.

Example: $10,000 x 125 percent = $12,500;

(d) Determine the just value of the total property after the damaged or destroyed portion has been replaced.

Example: $120,000;

(e) Determine the just value of the replaced portion of the property.

Example: $120,000 - $90,000 = $30,000; then

(f) Subtract the amount computed under paragraph (c) from the amount determined under paragraph (e).

Example: $30,000 - $12,500 = $17,500.

This excess value shall be treated as a change, addition, or improvement, and added to the assessed value, including the assessment limitation change for the year, as provided in subsection (3).

Example: $80,000 + $2,248 ($80,000 x 2.81 percent consumer price index (CPI), assessment limitation change) + $17,500 = $99,748.

(5) If the damaged portion is not replaced or substantially replaced in the year the damage occurred, but is replaced in a subsequent year, the replacement will be treated as a change, addition, or improvement as provided in subsections (3)(a) and (4), adjusted for changes in market and homestead property assessment limitation values. The just value of the damaged portion of property after the replacement or repair shall be compared to 125 percent of the value of the damaged portion as provided in subsections (3)(a) and (4).

(4)(6) When any portion of homestead property damaged by misfortune or calamity is and not replaced, or the replacement is not substantially completed in the year the damage occurred, or the square footage of the property after repair or replacement is less than 100 percent of the square footage prior to the damage or destruction portion as replaced is less than 100 percent of its previous just value, the assessed value of the property shall be reduced to the just value of the property after the destruction or damage of the property. If the just value after the damage or destruction is less than the total assessed value before the damage or destruction, the assessed value will be lowered to the just value.

(5) The provisions of subsection (3) of this rule section also apply to property where the owner permanently resides on the property when the damage or destruction occurred; the owner is not entitled to homestead exemption on January 1 of the year in which the damage or destruction occurred; and the owner applies for and receives homestead exemption on the property the following year.

Specific Authority 195.027(1), 213.06(1) FS. Law Implemented Ch. 2005-268, L.O.F., 192.042, 193.011, 193.023, 193.155, 193.1551, 213.05 FS. History–New 12-27-94, Amended 12-25-96, 1-16-06,________.

NAME OF PERSON ORIGINATING PROPOSED RULE: Sharon Gallops, Property Tax Technical Unit, Department of Revenue, 725 S. Calhoun St., Tallahassee, Florida 32399-0100, telephone [phone], e-mail address [e-mail]
NAME OF SUPERVISOR OR PERSON WHO APPROVED THE PROPOSED RULE: Jerry Miller, Revenue Program Administrator, Property Tax Technical Unit, Department of Revenue, 725 S. Calhoun St. Tallahassee, Florida 32399-0100, telephone [phone]
DATE PROPOSED RULE APPROVED BY AGENCY HEAD: August 13, 2007
DATE NOTICE OF PROPOSED RULE DEVELOPMENT PUBLISHED IN FAW: November 22, 2006, Vol. 32, No. 47, p. 5503-5506. A workshop was held on December 7, 2006. No comments were received during the workshop.