Rocky Tax Credit Implementation Needs Time Before Expansion

MACo submitted written testimony to the House Ways and Means Committee on March 20, 2018 in opposition to Senate Bill 427, “Property Tax Credit – Elderly Individuals and Veterans – Eligibility”.

This would expand a recently established property tax credit to all elderly individuals in a county over the age of 65 that have also lived there for 25 years. Currently, the credit only would apply to those over the age of 65 that have lived in the same house for at least 40 years. This is potentially a large expansion of the number of people eligible for the credit.

The four counties that have implemented the current optional property tax credit have received far more people making use of the credit than they had originally anticipated.

As counties seek to work out the impact in the reduction of property tax income, the effects of an expansion of that credit at this time could have further significant effects on the ability of many counties to adapt.

The bill has already passed the Senate with a 47-0 vote.

From MACo Testimony:

For the most part, these counties experienced interest in that tax credit that far exceeded their initial projections. With more residents making use of the 2016 credit than initially anticipated, the impact of the reduction in property tax income under the initial credit is still being explored by county governments.

It is clear, however, that they simply could not afford to extend it to a significantly larger pool of applicants at this point in time. Further, it is unclear whether counties have authority to limit the applicability of their individual credits under this broader enabling authority. Even if they do, however, officials will most certainly receive pressure to expand their existing credits, regardless – which they simply
do not have the means to accomplish at this juncture.

Counties request that they receive more time to administer this credit as-is and analyze its impacts before broadly expanding the nature and scope of this tax credit.”

For more on this and other legislation, follow MACo’s advocacy efforts during the 2018 legislative session here.

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