Senior Tax Cut Revisited
Posted by David Keelan on Thursday, December 21, 2006
A lot of discussion on this lately and especially in the papers.
Some of the commentary bothers me. For instance, someone suggested that these seniors should just sell out now, take their huge profits on their homes and move out of the county. Seems really fair doesn’t it? Here are people who spent a life time building this county and we just want to show them the exit. It sounds like some people want to shove them out the door. Don’t people understand that we become attached to our houses after 30 or 40 years?
Just remember, we will all be old some day. We will all be on fixed incomes. What is more we will all live longer then seniors today and if you don’t plan properly we could run out of retirement savings before we die. How are we going to pay the tax bill THEN. Simple, sell our houses, take the equity and move some where else. Why stay were you aren’t wanted even though you spent a life time here raising your children, cooking out in the backyard with your neighbors and friends, watching out for the kids in the neigborhood who now bring their kids to the neighborhood where they grew up to visit with old neighbors..
We are all building something and want to have something to show for our lives in the end. Spend 40 or 50 years working your heart out, worrying about the kids, fixing up the house and the yard, prom pictures, weddings, birthdays, funerals. Turn 80 and no one gives a damn anymore.
I can’t believe the mentality of some people.
The arguement goes that the Senior Tax cut is discriminatory because we are not all getting a tax cut. Well, get rid of all special interest tax loop holes and I will support getting rid of this one.
People argue about what are we doing for renters? The answer is they don’t pay property taxes so nothing.
These folks spent blood, sweat and tears on their homes, family and community. We can’t stand by and watch them be slowly squeezed out of their homes.
We tried to help them before with the “Homestead Tax Credit” but guess what. Seniors don’t want a lien taken out on their homes in order to get a tax break – besides it isn’t a tax break it is a deferred tax that is levied against the estate.
It is a travesty that the same people who advocate for more affordable housing in Howard County don’t believe in affordable taxes for our senior citizens.
Remember, the idea from this bill was inspired by actions in the Democratic controlled General Assembly who passed House Bill 288. They had done a study on how much this would cost. Merdon included the information and gave it to the rest of the Council. The Howard County delegation supported this legislation in the General Assembly.
For a refresher here is the information on the General Assembly website.
I have stated this before and I will put it up here again.
The General Assembly Department of Legislative Services conducted a study of the financial impact to the Counties if they were to implement the provisions of HB288 being considered in CB68-2006.
A copy of that document can be found here.
The General Assembly estimated that in Howard County 10,829 residents could take advantage of this provision. Not all of these homeowners could take advantage of the tax cut because not all of them would meet the qualifications but the General Assembly estimated that 25% would be eligible and the revenue impact would be $3.9M per year.
Given projected revenue increases by the Howard County Spending Affordability Committee of 6% per year through FY2011
and the Monthly Revenue Estimates report which shows that Howard County has already exceeded projections.
“Revenues from this source (REAL PROPERTY TAX) thru August 2006 are 8.4% above the level collected thru August 2005. Actual receipts are 5% above the planned level. Strong reassessments have driven this revenue for the past several years and should continue to be a reliable source this year.”j
Overall revenues “August 2006 revenues are nearly 5% above the planned level and 6.8% above the level reported for August 2005. Property tax revenues continue to be strong.”
Howard County takes in more revenue than projected every year. Then we spend it. That is a problem dear reader. We can afford this tax cut… or can we?
Now to further complicate matters. Howard County (like other jurisdications) has been underfunding retirement benefits for its employees. In fairness they have been funding it on a pay as you go basis and not funding future liabilities. Previously accounting requirements for state and local governments did not require that these liabilities be fully funded and/or accounted for. Now that the rules have changed this creates a problem and a whole other post in which I will outline the changes, the impacts to Howard County’s budget, and what that might mean to you and to me.