Retirees Warn of "Catastrophe" from Amendment 5 Service Cuts, New Taxes -- On Tuesday, members and staff from the Florida Association of Homes and Services for the Aging (FAHSA) and the Florida Life Care Residents Association (FLiCRA) spoke out during a press conference held in Tallahassee warning citizens that if Amendment 5 is placed and passed on the November ballot, it could have "catastrophic" effects for Florida's seniors.  
 

 

Speaking on behalf of FAHSA and FLiCRA, Dr. Benjamin Colmery, Westminster Oaks resident; Gladys Davis, Georgia Belle Apartments resident; Bennett Napier, CEO, FLiCRA; and Janegale Boyd, President/CEO, FAHSA, charged that Amendment 5 could be a "Category 5 disaster" for Florida elders by creating new taxes on sales and services that would raise the cost of services that retirees rely on, including: monthly community maintenance fees, community entrance fees, meal plans, home health and nursing care and laundry.
 
"If Amendment 5 passes, tens of thousands of retired Floridians, on fixed incomes, would have to pay far more in living costs than they had planned," said Bennett Napier, Executive Director of the Florida Life Care Residents Association. "Such unexpected new costs could have potentially catastrophic effects on the budgets of retirement communities and of residents, pushing them to the tipping point of eventually running out of money."
 
Concerns about the long-term financial security of Florida's seniors have grown as alarming new economic data has emerged showing an increase in bankruptcies among older Floridians. According to a new analysis from the Consumer Bankruptcy Project, the rate per thousand of bankruptcy filings for seniors aged 75 to 84 increased 433 percent from 1991 to 2007. For the same period, bankruptcy rates for seniors aged 65 to 74 increased 125 percent. 
 
A new report, published in July by Ernst & Young, paints a dispiriting picture of the long-term solvency of retired Floridians' savings. Floridians near retirement today have a 75 percent chance of outliving their assets, according to the report, and newly retired Floridians have a 61 percent chance of someday running out of money.
 
"If unexpected new services tax costs imposed by Amendment 5 push retired Floridians into insolvency, thousands who worked hard to finance privately their own long-term care needs could be forced into Medicaid and other taxpayer-funded services," said Dr. Ben Colmery. "In these difficult economic times, the last thing we need to do is raise taxes on our seniors."
 
The groups further argued that with sales tax revenues continuing to decline, the Florida Legislature is expected again to make deep cuts to state-funded elder services - raising questions about the financial wisdom of forcing the state into deeper dependence on the sales tax.
"The simple fact is that greater reliance on the sales tax is not good public policy, and that's only one reason why Amendment 5 would be a Category 5 disaster for Florida seniors," said Janegale Boyd, President and CEO of the Florida Association for Homes and Services for the Aging. "In one stroke, this misguided, misleading Amendment would create new taxes, harm public education, burden seniors on fixed incomes, and devastate critical public services upon which seniors and all Floridians rely."
 
Gladys Davis also argued that Amendment 5 would punish Floridians who rent their homes and thus would not receive property tax cuts to offset higher sales taxes.  "I am convinced that new taxes on sales and services that would likely result from Amendment 5 would make my struggle to keep up with rising costs even more difficult," Davis said. "Like many Floridians with modest incomes, I do not own a home. I would not benefit one iota from Amendment 5. Instead, I would lose by paying more everyday in higher costs and higher taxes."  
 
Amendments 7 and 9 Removed from Ballot, Too - In addition to striking Amendment 5 from the ballot, the Court also struck Amendments 7 and 9, reversing a lower court decision that ruled these amendments proper.  Amendment 7 would have removed the constitutional ban on using public funds for religious-based institutions. Amendment 9 would have authorized school vouchers by allowing the use of public money for tuition assistance at private schools and simultaneously required school districts to spend at least 65 percent of their funding in the classroom (a proposal known as the "65 percent solution").  The argument raised by the challenges to Amendment 7 and 9 was that they were outside the scope of the Taxation and Budget Reform Commission's authority for proposing constitutional amendments, which it was argued is limited to issues concerning taxation and the "state budgetary process" by the constitution (Art. XI, Sec. 6(e)). In reversing the lower court decision and striking these amendments, the Court also ordered that no reconsideration would be entertained and indicated that a full opinion explaining the issues is forthcoming.
Source: TaxWatch E-communique, September 3, 2008