Having thrown her support behind a bill that would erase an $11.5 million tax lien on U.S. Navy housing, state Rep. Holly Raschein, Republican from Key Largo, appears poised to take on the city of Key West, Monroe County Property Appraiser's Office and, to some extent, her own constituency.
In 2007, the Navy transferred ownership of 890 housing units to Southeast Housing LLC, a division of Balfour Beatty Communities.
Last year, based on the switch from federal to private ownership, then-Monroe County Property Appraiser Karl Borglum reversed an earlier decision to grant a tax exemption to those properties and filed the lien seeking back taxes, penalties and interest.
Tuesday, the state House Veteran and Military Affairs committee, on which Raschein sits, passed a bill, 13-0, exempting such military-related housing statewide from property taxes retroactive to 2007. The next stops are the Finance and Tax Subcommittee, then the Economic Affairs Committee before the March 5 opening of the two-month legislative session.
"The whole reason for the exemption is supporting military families," Raschein said Thursday. "The bottom line is, we've got to provide quality housing for military families. There're some real concerns in Key West over this ... and I feel like I need to vote no but a vote no is a vote against military housing."
Rep. Jimmy Patronis (R-Panama City) sponsored the House Bill and Sen. John Thrasher (R-St. Augustine) its Senate companion.
At the Wednesday Key West City Commission meeting, Commissioner Jimmy Weekley directed City Attorney Shawn Smith to draft a resolution opposing the exemption bills, which Weekley called "ridiculous."
"And our representative is sitting there and supporting it," he said. "I support military families also but remember: The people that are living there aren't military."
He's referring to the Peary Court neighborhood in his District 1, which is open to non-military renters and in the process of being sold to a private developer for a rumored $30 million-plus.
There are a combined 890 military houses in Key West at Peary Court, Sigsbee Park, Truman Annex, Trumbo Point and the Branch Medical Clinic on South Roosevelt Boulevard.
Raschein said she's considering proposing an amendment that would limit the exemption to houses actually occupied by military families.
Raschein wrote to KeysNet on Friday: "If Monroe County truly was owed these funds, I could not support this legislation. However, current law already allows the exemption in question so all the legislation does is to ask for a clarification and affirmation of current law. The taxes in question were never owed, so they cannot be taken away."
Southeast Housing is also suing the Monroe County Property Appraiser's Office seeking to have the lien removed and exemption reinstated.
Property Appraiser Scott Russell said he's content to let the legal process play out and discuss the issue with other property appraisers in affected areas.
"We believe that statutorily, Southeast owns the buildings and improvements" and they are not tax exempt, he said.
Privatization of military housing began in 1996. The general idea was to leverage partnerships with private entities to attract investment and modernize and maintain aging homes and build new units.