CITIZEN COALITION OF FLORIDA

10 OBJECTIVES P= OINTS STEMMING FROM THE PROPERTY TAX CRISIS

Citie= s and counties have embarked on spending sprees fueled by seven (7) years of prop= erty tax collection that has grown disproportionately compared to inflation, population and salaries.

The p= roperty tax revenue increase since the year 2000 has gone from 0 to 178% for Miami-Dade County, 123% for Fort Lauderdale, 82% for Broward County and 108% for Miami= .

The f= ollowing are the 10 minimum objective points we should have regarding facts stemming from the property tax crisis:

1. = The number of foreclosures in Dade County to date reac= hes almost 15,000. Major lenders = are repossessing homes in southern California faster than they are being sold. This could set off a downward spiral of price cuts and more foreclosures. This will happe= n as the lenders inventories grow so large that they will have to start aggressi= vely cutting prices. The data that= would advise us of the amount of evictions, which are also homes to people that a= re renting, is not readily available

2. In the year 2006 the amount of people who have left Florida is more than 100,000. This con= sists of mainly middle class blacks and young Hispanics. (Miami Herald July 28, 2007 Study: Blacks fleeing= Dade). A study released by FIU sounde= d the alarm about Miami-Dade facing a brain-drain of middle class blacks and young professionals leaving. Additionally, 40% of the wage earners between $60-80,000/year that h= eld college degrees are planning on leaving.&n= bsp; The same is true for young Hispanics.

3. = Deficit of income to the state of Flo= rida for the past 6 months is approximately $1 billion. Therefore for the rest of the year it will be $2 billion; this is the main reason why there is a spec= ial session. Lawmakers will have = to cut the state’s $71 billion-plus budget by at least $1 billion during a three-week special session that starts Sept. 18, 2007.&nbs= p; Some of those cuts could hit public schools and healthcare programs = for the poor.

4. = As quoted by The Wallstreet Journal there is a real-estate recession which is worse in the State of Florida= and horrible in Dade County. Home Mortgage companies such as Am= erican Home Mortgage have filed for bankruptcy.&n= bsp; Real Estate recession secondary to the saturation of condominiums wi= ll lower sales prices 30%. Sales= themselves were down 50% in May 2007.

5. = The Federal Reserve has had a need to flood financial markets with three big injections of cash last week to head off concerns that a spreading credit crunch would cause and Wall Street melt down. The Central Bank had to act in wak= e of signs that problems in the subprime mortgage market for riskier loans had b= egun to spread to other sectors. L= oans that are not paying interest to Florida banks increased 43% in the first trimester of 2007. Banks have stopped lending money to companies that build condominiums. This has cost a tremendous tightening of credit. The central bank had to purchase mortgage backed securities from financial institutions rather than governme= nt securities as it usually does. (The economic effect nationwide is represented by the need of infusion of money = from the Federal Reserve for the Wall Street stock market to prevent further deterioration of the present situation which has been described as the worst crisis in the last 20 years).

6. = August 2, 2007 in the Miami Herald: Auto sales in Florida have plummeted in the past 18 months. During one three-month period in 2005, the state took in $1billion form taxes on auto sales. The past three months $906 million= .

7. = Insurance: Approximately 6 months ago Governor Charlie Crist signed legislation saying he would lower property insurance premiums. What really happene= d is that the new proposed rates for property insurance are as follows: 30% increase from Florida Farm Bur= eau, 94% increase from Century Insurance and 53.9% from USAA which insures those= in the military and there families. State Farm was one of the companies that from the beginning doubted = the States assertion that cuts in the 20% range would be feasible or obtainable= . State Farm has already announced i= ts decision to not renew coastal property policies.

Citizens Property Insurance, the State-run insurance company of last resort, mainly = for windstorm coverage, has a history of being plagued with accusations of receiving kickbacks via the former chief operating officer.

The main lawyers for Citizens Property Insurance represented clients seeking Citizens business raising concerns about a possible conflict of interest.

State audits found problems of lax accountability in the State-run insurance pool= .

Poor business managements by Citizens Property Insurance resulted in deficits of $1.5 billion that have to be covered by the State as well additional charge= s made to those insured by other companies. This effectively increases the premiums every homeowner will pay for property insurance.

Florida’s controversial no-fault insurance law will die as of October 1, 2007. This will leave Floridians without any kind of mandatory coverage. The spin-off is that health insura= nce companies plan to increase there premiums to cover new claims from auto accidents. At the same time a= uto insurance companies will most probably mandate an increase in premiums for uninsured motorists.

To enter into a detailed analysis of the home insurance crisis would be redund= ant. It is of common knowledge that pro= perty owners have elected not to purchase Windstorm Insurance or forego it all together after the new “deductible percentages” have come into effect.

A health insurance analysis is also redundant. Coverage is less, prices have mult= iplied in a geometrically exponential manner.&nbs= p; The middle class is unable to afford insurance coverage and the ones offered are plagued with copays, deductibles and a myriad of restrictions.<= o:p>

8. = Due to the increasing costs of life most of us became “do it ourselves= 221; carpenters, electricians, tile setters, painters and plumbers. The end result from these savings = (i.e. us doing it ourselves) was beneficial for the world’s largest home improvement chain: Home Depot= . However, the second quarter of thi= s year already reports a 15% drop in profits and an approximate 6% decrease in sal= es. As per Home Depot this is secondary to the weakness in the housing market w= hich expects to continue next year.

Construction of new homes fell at the end of July 2007 to the lowest level in the past 11 years down 20% from the activity 1 year ago. This a direct consequence of the worsening secondary to the rise of mortgage defaults particularly in the sub-prime market.

The national Association of Home Builders said the housing market index fell 2 points the month of July 2007. This was the lowest reading since 1991. <= /span>

9. = The cost of has food way beyond what was expected for certain items as a result= of the ever increasing gasoline prices.

40 of the top restaurants in the Miami-Dade County area have closed. The main reason: unaffordability of rental payments= .

Diet essentials such as milk and eggs have increased in cost by 30% followed by frozen juices, dried beans and fresh whole chickens which have increased approximately 10%. This is fr= om July 2006 to July 2007. The q= uoted reasons for these increases are partly because of corn prices driven up by congressional mandates for ethanol production. The energy balance of corn ethanol= is currently being debated since there are claims that the amount of energy th= at goes into production compared to the energy that it obtained as a fuel is n= ot very efficient in this Country: 1.3:1. Brazil = is more efficient at extracting the energy from corn to use a fuel source; its ener= gy balance is 8:1.

10. Recession. Economic analysis related to the o= dds of recession has gone up from 50% since the beginning of the year according to= Merrill Lynch. The last time this occ= urred was 17 years ago. Banks must = resume lending to businesses and home buyers which at present they are not doing.<= span style=3D'mso-spacerun:yes'> This is tied to the real estate ma= rket’s value uncertainty. All financ= ial crises have their unique characteristics.&= nbsp; The present crisis is based upon the home mortgage market as evidenc= ed by the large amount of bankruptcies by companies issuing home loans to risky buyers. As a result banks are withholding new loans even from sound businesses.

If banks do not extend credit, businesses cannot grow. If businesses do not grow, unemplo= yment will rise.

Stock prices are falling and as such Americans are losing there wealth in there investments. This coupled with eroding home prices, spending is reduced.&= nbsp; Spending drives the economy; if there is no spending, the economy su= ffers and stagnates.

Countrywide Financial, the largest US home lender, has retreated almost entirely from making loans that do not co= mply with the standards set by government-sponsored entities.

SUMMARY=

When = you put these 10 points together and saddle the common middle class citizen, the conclusion is that most people will not be able to survive in the current climate. All of this stems fr= om the property tax crisis. It creat= es a financial-type of depression that transcends to the building blocks of the family in a destructive fashion. It affects elderly parents, married couples and children, each one in a differ= ent way but effectively weakening and undermining the family. We must unite and present a common= front of all citizens, black or white, anglo or hispanic, republican or democrat, catholic, protestant or jew, = poor, lower, middle or upper class. The time is now admidst this ongoing process if we are to survive.

CITIZENS COALITION= OF FLORIDA

(FAIR PROPERTY T= AX FOR ALL, INC)

Jose H. Valladares, MD, President, Hernan Santiesteban, Co-Chairman, Gregorio Rodriguez, Treasurer, Eladio J. Armesto, Legal Secret= ary

Phone: 305-541-9= 300

fairpropertytaxf= orall@gmail.com