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Tax breaks for elderly spur debate
By Cliff Hightower
Staff Writer, TimesFreePress.com
April 29, 2007
Local officials said this week they have questions and concerns about a tax-freeze bill for senior homeowners making its way through the Tennessee Senate.
The bill shields some homeowners older than 65 from most future property tax increases and would apply to people who earn less than the median income for county residents aged 65-74.
"Property tax is a major revenue source for counties," McMinn County Mayor John Gentry said. "When you restrict that, you put pressure on other revenue services. Who does that leave to pay?"
The Senate Finance Committee is expected to vote this week whether to send the bill to the full Senate. Its sponsor, Senate Republican Leader Mark Norris, R-Collierville, could not be reached Friday for comment.
He told The Associated Press last week that he thought the constitutional amendment voters passed overwhelmingly in November would order the legislature to set maximum income limits. He said he believed counties would be allowed to set eligibilhresholds up to the maximum.
But Attorney General Bob Cooper has issued an opinion saying the amendment doesn't give counties a say in setting the income level, the AP reported. Counties may vote whether to participate in the tax break.
Officials across Southeast Tennessee asked who would track local residents for age and eligibility if the bill does become law.
"It sounds like it would be a lot of trouble to keep up with," Bradley County Property Assessor Stanley Thompson said.
Mr. Thompson said he has no idea how many Bradley County residents are 65 and older. The county trustee's office tracks some in that age range who qualify for federal programs, he said.
He said the county could lose more than $10,000 in the first year of the tax freeze is implemented. He said the full effect wouldn't be felt until after a few years of property reappraisals and possible county property tax increases.
Marion County Mayor Howell Moss said his county could lose between $3,000 to $4,000 in the first year. But he said he thinks the tax break is needed for senior citizens who can't afford increasing property taxes.
"That much money would not be a great impact," he said. "That's something we could live with."
Polk County Mayor Mike Stinnett said he is still seeking answers on how much of an effect adopting the tax break would have on his county.
"It's going to hurt counties," he said. "There's no way around that because you're taking away revenue."
He said some counties might choose not to opt in.
"It might be unpopular, but it might have to be done," Mr. Stinnett said.
Mr. Gentry said that those 65 and older are the fastest growing segment across the U.S. The largest generation ever, baby boomers, is moving toward that age bracket, he said. Baby boomers and retirees also make up a large portion of the people moving into Southeast Tennessee, he said.
"It's going to create a challenge for government eventually," he said. "We'll deal with it."
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