Property Taxes
4:35 pm
Mon October 14, 2013

Pileggi Proposes Property Tax Freeze for Senior Citizens

Multiple pieces of legislation have been introduced to take on the burden of school property taxes.

The Senate Finance Committee is holding a public hearing on Tuesday regarding one of the bills, Senate and House Bill 76, which would eliminate school property taxes and replace them with a combination of personal income and sales taxes.

Erik Arneson, spokesman for Senate Majority Leader Dominic Pileggi (R-Delaware), said the Independent Fiscal Office plans to address a number of very serious complications with the defeated bill at the hearing.

 “The House defeated an amendment that was based on that bill very soundly, and so I think that people are turning their attention to other proposals which are seen as having a much more realistic shot of actually being enacted into law and helping to address the issue,” Arneson said.

One of these other proposals is Pileggi’s bill that would freeze property taxes for seniors.

“Property taxes have been increasing at a rate that significantly exceeds any increase in Social Security, so it’s forcing many seniors to make very difficult budget choices,” Arneson said.

He said the issue has become so serious that some seniors have had to leave the homes they’ve lived in for decades.

He said the bill is an attempt to give seniors the stability of knowing that their property taxes are not going to increase.

Pileggi’s bill would freeze the property tax rates for people 65 years or older after the establishment of a base payment.

Eligible seniors would be those that have paid their taxes and had a homestead exemption for the previous five years.

According to Arneson, the tax freeze would remain the same despite any reassessments or millage rate changes.

“It locks in the amount of money that was paid, so if it was a thousand dollars, it’ll stay that, or 3,000 dollars will stay that,” Arneson said. “Whatever it is, it stays that same amount regardless of any millage changes and regardless of any reassessments.”

Arneson said they estimate the bill would cost $74 million the first year in effect, which they believe to be a manageable number in the context of the overall state budget.

He said the state would reimburse the schools for any revenue they would lose due to the freeze, but the legislation does not propose any specific method of compensation.

“Our hope is that by stripping away a lot of the complications and saying, ‘Look, the main problem is senior citizens on a fixed income, let’s address that, here’s a really simple way to get it done,’" Arneson said. "We think that that kind of a direct approach has a very good chance of getting through the General Assembly.”

Arneson said their goal is to get something through and on the governor’s desk later this year if possible.