Tonight the Louisville City Council will likely repeal an ordinance that gives cash rebates on property taxes to the elderly. (Since 1973 anyone over 65 could apply.) But it's not as cold-hearted as it may first appear. The reason is that the state has reinstituted a similar tax break for seniors that pays much more than Louisville's program. The catch is that the state requires a person over 65 to have lived in, owned and paid taxes on the property for at least ten years. With Louisville facing budget cutbacks, staff estimates a savings of about $32,000 based on previous years' payouts.
So at first I thought that stinks for the seniors in town, who may see property taxes go up with property values while their income plateaus. Now, I don't want to sound like a curmudgeon (how old do you have to be to be a curmudgeon anyway? I don't think I've been around long enough yet) but Louisville's payback maxed out at about $100 per year. The state is going to max out around $600. Is this a necessary expenditure for the state government? And anyway, is that enough money to make a substantial difference in a yearly budget? If you own a home valued high enough to get the full $600, will $50 a month matter? It seems like a perk, a bone thrown to a special interest group. I'm not really against it in the grand scheme, I'm just sayin'.
Am I missing something here? Or is this my curmudgeon-to-be speaking out?
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We're talking about the will of statewide voters here. Colorado's state constitutional Homestead Exemption was enacted by referendum in 2000, after years of steady statewide economic growth and real property appreciation. The state coffers were overflowing, and every year we received a nice TABOR refund. The Homestead Exemption's budget impact would be, in that climate, a mere reduction in the total TABOR refund. No big deal, and fair for seniors on fixed incomes.
Perhaps now it is more clearly a budget impact, but the Homestead Exemption cost is presently captured by excess revenues subject to Referendum C.
Once Referendum C is done, the Homestead Exemption will be in the base budget.
Is this a good idea? It's a matter of fiscal policy. I think I saw that it was projected to affect about 1.4 percent of Colorado's overall property tax collections.
Yes, the benefit serves the interests of a specific group, but those intersts seem to be aligned with the overall social interest in promoting - or at least accommodating - retirement.
Is there harm caused by the Homestead Exemption? Or is there something better to spend $44 million on? That would be the argument, I think.
Personally, there are a lot of worthwhile investments in the $44 million range. But I do believe in retirement.
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