City Schools of Decatur’s Senior Homestead Exemption Commission will propose a thoroughly refurbished senior exemption to school board members during their Sept 8 virtual meeting, beginning 6:30 p.m. and accessed at https://csdecatur.zoom.us/j/98708249383.
The nine-person commission, meeting regularly since April, is essentially recommending two new exemptions, one for city residents 65-69 and another for those 70 and over.
The current exemption, which took effect Jan. 2017, offered seniors 65 and over full exemption of all school taxes. But by the end of this year it’s anticipated that exemption will cost CSD about $5 million more than originally anticipated.
The current exemption has a five-year sunset, meaning it expires Dec. 31, 2021, after which gets renewed, or revised, or dropped altogether.
A revised exemption requires a series of steps including: the board’s acceptance and/or refinement of the commission’s Tuesday recommendations; after board approval of a final revision CSD must introduce the new proposed exemption to the state’s General Assembly during the 2021 session; it must subsequently pass the House and Senate and finally voter scrutiny in Nov. 2021, before taking effect in Jan. 2022.
The commission describes the proposed new exemption for age 65-69 residents as a “need-based exemption, focused on vulnerable or disadvantaged seniors.” The specific amount gets determined from, among other factors, current home values and Area Median Income.
The second proposed exemption is a mostly full-exemption for those 70 and over with, according to the report, “minimal caps.”
The commission’s stated goal in its recommendation is keeping the cost, or what CSD would lose in annual revenue, at $4.3 million.
This is dramatically more than what CSD had originally anticipated. Back in 2015, while planning the current exemption, the district estimated it would lose $1.2 million annually. But a study commissioned last year shows the district losing $3.41 million in 2018 and $3.24 million in 2017. By the second billing of 2019 this had jumped to $6.2 million.
Earlier this year the school board was unequivocal in declaring that any new exemption keep revenue lost at the original $1.2 million. But during a recent interview Commission Chair Paula Collins admitted, “we stopped talking about that 1.2 million two months ago. That figure is obsolete.”
There are several reasons for this, including the city’s population increase and more people turning 65. But the bottom line is that far more seniors are taking the exemption than what CSD calculated five years ago. According to Collins, the district originally estimated that 1,027 would take the exemption, but by the second billing of 2019 it was just under 1400.
The exemption commission is also recommending CSD hire an analytical firm with access to data unavailable to either the commission or the school district.
“A firm like that could analyze things like income data,” Collins said. “They could maybe create a model showing how the exemption can be updated every time the [Area Median Income] changes. Therefore the exemption would adjust with the market and ideally could get updated annually or bi-annually.
“But I think the big question all this raises,” she added, “is that, can we find a way where we don’t have to continually revisit [and re-vote on] this every five years? Right now, I don’t have an answer for that.”
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