Editor's note: This story has been amended to correct the calculation for the proposed property tax exemption changes for seniors.
CENTERVILLE -- Voters will decide Nov. 5 whether senior citizens 70 and over will continue to pay no city property taxes or whether they will be given a $50,000 tax break instead and pay a portion of the taxes that go toward city services such as police and fire protection.
Under the proposal, taxes on a $100,000 home, for example, would be granted a $50,000 exemption before the standard 40 percent taxable value is applied. That homeowner would pay taxes only on $20,000 of the home's total value. Based on the current millage rate of 11.972 mills, the tax on the home would be $239.44.
City Council members decided in May they would put the issue before voters, who have the final say on whether the senior exemption stays at its 100 percent level or is changed.
City officials hope to recoup at least some of the tax revenue lost annually through the exemption. Councilman Ed Tucker, who introduced the measure to put the question on November’s ballot, said the city loses about $200,000 a year because of the full senior exemption.
Tucker said the full exemption amounts to providing free police, fire and other services to Centerville’s growing senior population and isn’t fair to the under-70 population also facing financial stress.
He said the full exemption is no longer fair or a good financial option for the community.
“When the exemption came into effect about 20 years ago, it was to benefit a few elderly citizens -- I think about eight or so widows and such -- who needed it to stay in their homes,” Tucker said. “Now the number of eligible senior citizens has risen to 300 to 400.”
In public meetings, Councilman Cameron Andrews said the move to change the exemption isn’t meant to disrespect senior citizens. However, to continue it would be “catastrophic” to the city financially, he said.
After deciding in May to place the question before voters, the council then had to decide whether to try to eliminate the exemption entirely or to allow seniors to retain some measure of a tax break.
The possibility of a total elimination drew crowds of seniors to public hearings on the matter.
City Councilman Randall Wright, 66, asked the council to ask voters to change the exemption to $50,000 rather than entirely eliminating it.
Among those voicing opposition to a complete elimination of the senior tax exemption was Richard Beladino, 74. Beladino said he spoke for no one but himself but was trying to help fellow Centerville seniors’ voices be heard.
“No one wants to pay more taxes,” he said. “Just like most people, I’m not saying how I’m going to vote, that’s a private matter, and I’m not going to say I want to pay more taxes. But I am afraid if it fails it might come back again later as a complete elimination. I think we felt a $50,000 exemption was better than the possibility of eliminating it entirely.”
Tucker credits Beladino’s input with helping the council arrive at the $50,000 figure. Tucker said he thinks a complete elimination would have a hard time passing. He said the $50,000 figure is fair and fulfills the exemption’s original purpose to aid those who need it while still bringing lost income to the city to more fairly spread the cost of city services.
City Clerk Krista Bedingfield’s office is charged with signing up seniors for the exemption. If the measure passes, she said it would go into effect for the 2014 tax year, not the 2013 year which remains under the 100 percent exemption. Among the 28 new seniors who have applied for the exemption since January, only about 10 would be required to pay any property tax under the formula that would go into effect if the new exemption plan passes, she said. She said none voiced a complaint to her about the potential increase.
“If this passes, we’ll probably see around $130,000 to $140,000 in added annual revenue,” Tucker said. “In years to come, think what that could mean, maybe an additional fire truck or two.”
Contact Michael W. Pannell at email@example.com.