Senior homestead exemption on ballot

COVINGTON - Newton County senior citizens will get an additional break on taxes if a referendum on the Nov. 4 ballot passes.

If approved, residents age 65 and older whose income does not exceed $25,000 would receive a homestead exemption in the amount of $30,000 of the assessed value of their homestead.

The new exemption would result in an additional annual loss of revenue for Newton County in the amount of $436,682, Newton County Tax Assessor Tommy Knight said.

Currently, seniors earning $15,000 or less receive a $16,000 local exemption plus a $4,000 exemption from the state, for a total exemption of $20,000.

About 3,200 parcels qualify for that exemption, representing nearly $500,000 in lost revenue annually, Knight said.

An additional 500 parcels would qualify for the new exemption, resulting in the additional $436,682 loss, bringing the total annual loss of revenue from both exemptions to more than $900,000.

Knight estimated that other taxpayers could be impacted by an additional $10 to $11 per tax bill if the millage rate is maintained.

"The figure of $10 to $11 is what all other property owners would possibly have to pay to make up this difference if the county commissioners decide these revenues are needed," he said.

However, John Middleton, the county's administrative officer, said there has been no discussion about raising taxes on other property owners.

"I think the commissioners fully recognized the revenue implications when they decided to put that on the ballot and accepted the responsibility that goes with that," he said.

Each year, the county budget is built off a revenue model based on the current millage rate of 9.73 mills, he said.

"I don't think it's the intent of the board to put an exemption on the ballot to raise taxes. That just doesn't make any sense," he said.

Middleton noted that the decline in revenues that will occur if the exemption passes will have an impact on next year's budget.

"Any time you have a decline in revenue you're going to have some challenges," he said.

The homestead exemption was placed on the ballot at the request of Newton Citizens for Tax Relief Inc., a group of seniors that formed to push tax breaks after seeing a rapid rise in their property values. "People who are retired saw their taxes double, or more. It takes more of their income than they can afford to pay," said the group's founder, Frank Davis, who said he saw his taxes increase from $1,100 to $2,200 in recent years, but noted his retirement check has not increased.

Davis figures many seniors who qualify for the exemption will see property taxes decline by about $100 per year, which he said is the equivalent of an income increase for the retirement set.

Newton Citizens for Tax Relief originally proposed freezing property values for all residents, but the board opted not to go that route. The board also rejected a proposal to entirely exempt seniors from property taxes after hearing from Knight that it would result in an annual revenue loss of between $1.6 and $1.9 million.

Davis acknowledged that the exemption will mean less revenue for the county in tough economic times, but noted that seniors were being hit doubly hard now, as well.

"If you look at the stock market and what it did in the last two weeks, seniors own a lot of stocks. That's income they depend upon also," he said. "I understand the county and state are having problems and they're probably going to have to cut expenses somewhere to get through this. But maybe it will be short-lived."

Though not everything proponents had hoped for, Davis said the proposed exemption is "a step in the right direction for seniors."

He had one last word of advice for voters: "It's the last thing on the ballot. If you don't go all the way, you'll miss it."

Crystal Tatum can be reached at crystal.tatum@newtoncitizen.com.