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More communities freeze property taxes for seniors
By Christina E. Sanchez • THE TENNESSEAN •
October 22, 2008
Roy and Marilyn Schweitzer live modestly on their Social Security checks and small pensions. But even with careful spending, the rising costs of basic necessities dip into their fixed incomes.
"Everyone else is in the same boat we are," said Roy Schweitzer, 80, about the situation many senior citizens are facing. "Every buck we can save is welcomed."
One thing helping the Rutherford County couple is the Property Tax Freeze Act of 2007, which allows property owners over age 65 to keep their property tax bill at a fixed amount even if the tax rate increases or the appraised value of their home goes up.
More than 16,000 senior citizens across the state have gotten a property tax freeze since state lawmakers approved the program in 2007 — with some 6,500 of those seniors coming from Davidson County. Metro officials say that number could exceed 7,000 by April.
Some 30 counties and cities participate in the program, and a growing number of communities are considering adopting it to give seniors some relief.
Tom Fleming, assistant to the state comptroller for property assessments, said the number of participating communities statewide has more than doubled in one year from eight counties and one city to 19 counties and 11 cities. More governments could jump on board before year's end.
"It is up to the municipality or county to adopt it," Fleming said.
The program has allowed the Schweitzers to lock in their property taxes at $829 for years to come.
To apply, seniors have go to their county trustee's office or local collector of taxes and fill out the appropriate forms. Most trustees request that seniors call in advance to set up an appointment and to discuss eligibility and requirements. In addition to the age prerequisite, the combined income of all the owners on the deed cannot exceed the predetermined amount set by a state formula. The formula uses the county's median income and population.
Income limits vary
Qualifying income levels vary from county to county, the highest being Williamson County, with a cap of $44,570. Many counties have an income limit of $24,790.
Also, seniors must reapply annually to make sure they still qualify. Once it's set, the only way the property tax bill can increase is if the seniors make home improvements, such as adding a room, or if the community withdraws from the statewide program.
Davidson County was among the first to sign on to the plan in 2007, with Wilson, Sumner, Rutherford and Williamson following shortly after.
"Times have tightened for everyone," said Davidson County Trustee Charlie Cardwell.
Cardwell thinks Davidson County's aggressive advertising of the tax freeze program led Metro to have the most tax freezes in Tennessee.
Rutherford County chose to join the tax program in August.
"This will help give seniors the security that they will be able to stay in their homes," said Teb Batey, Rutherford County trustee.
Batey said in the two months since the application process started, about 400 seniors were approved, with hundreds more awaiting approval.
"I think everybody is a little nervous about the economy even if they are not directly tied to what is happening with the markets," Batey said.
Still time to apply
The Office of the Comptroller of the Treasury will not know until April 2009 how many more seniors statewide will be approved for the 2008 tax freeze. The deadline to apply is up to 35 days after the tax bill is due, which for many counties falls on April 6.
Middle Tennessee cities offering the freeze include Goodlettsville, Gallatin and Portland.
Cities and counties have until Dec. 31 to adopt the program for their communities.
Hendersonville's Board of Mayor and Aldermen gave initial approval of an ordinance for senior tax freezes on Oct. 14, but the law must pass a second reading on Oct. 28.
Spring Hill is another city looking at the freezes, and the Board of Mayor and Aldermen are expected to discuss the issue in November, said Jim Smith, city finance director.
Because the property tax freeze program is less than 2 years old, communities can't say yet what, if any, financial impact they would see. The freeze doesn't have any bearing until the tax rate goes up.
"I believe the difference in dollars would be a few thousand and would be an immaterial amount," said Smith. "The pro would be helping out the seniors."
Cardwell, the Davidson trustee, said if there is a tax rate increase, the difference that the seniors don't pay is spread among the rest of the taxpayers.
"We figure that at most for every penny increase on the tax rate we would lose about $100,000 on each penny," Cardwell said. "It's spread out among the rest of the taxpayers."
Schweitzer feels he has paid his dues and believes seniors should get a break.
"Finally, someone sees what should be done to help senior citizens," he said.
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