A new Missouri law allowing counties to provide property tax relief for seniors may be amended during this year’s legislative session to clarify who would qualify.
Members of the Senate Economic Development and Tax Policy Committee heard testimony Tuesday on legislation amending the senior property tax freeze passed last year.
Sen. Tony Luetkemeyer, R-Parkville, said there was confusion on whether someone had to qualify for and be eligible for Social Security benefits to receive the freeze.
“The implication being if that were the case, there would be certain categories of employees, particularly public-sector employees, firefighters, teachers, who may not qualify for that,” Luetkemeyer said. “And so this bill seeks to clarify that anyone aged 62 or older, regardless of whether they draw Social Security benefits, is eligible.”
Another change to the original law concerns when the tax freeze is calculated.
“This bill makes clear that the tax credit is calculated as of the date that the individual reaches age 62, and the county has also adopted an ordinance implementing Senate Bill 190, making clear that the tax relief granted under the bill is prospective as opposed to being retroactive,” Luetkemeyer said.
Luetkemeyer sponsored the original legislation last session that has already been adopted by some counties, including Jackson, St. Charles and St. Louis counties.
Sen. Karla Eslinger, R-Wasola, asked Luetkemeyer whether the state is keeping track of the number of counties that have implemented the freeze and the resulting financial effects.
“I absolutely support anytime that we have an opportunity to reduce tax for our seniors, because I do know that with reassessment that we did have where [seniors] couldn't afford to stay in their homes, and that is a tragedy,” Eslinger said. “But I also want to make sure that we don't have unintentional harm to our public services that we all do rely on, no matter what your tax bracket is.”
Luetkemeyer said he believes more than 12 counties have enacted the freeze, but the state won’t know what the fiscal impact will be until another reassessment cycle.
Sen. Doug Beck, D-Affton, asked whether there would be the ability to place limits on the tax relief for people who have higher incomes.
“When you have billionaires that are going to reap the same benefits from this and they don't need that tax relief, whereas we have people that actually truly could, that are splitting their medications and going to the grocery store and dividing things,” Beck said.
Luetkemeyer said he would not support limitations.
“My view is that if you're a Missouri senior, and you're on a fixed income, even if you're a billionaire, I think that we should not be picking winners and losers when it comes to tax relief,” Luetkemeyer said.
Personal property taxes
Senators also heard testimony Tuesday on two bills on personal property taxes.
The identical bills, sponsored by Sen. Bill Eigel, R-Weldon Spring, and Sen. Denny Hoskins, R-Warrensburg, would lower the assessment rate on personal property taxes.
The legislation would reduce the assessment rates for personal property as revenue grew from higher real property assessments.
Currently, personal property is assessed at one-third of its true value.
The bill also makes local governments that face a loss of revenue from the change eligible for reimbursements from the state.
“This provides an enormous amount of protection for local districts, while at the same time ensuring that we will join 29 other states and not hammering working- and middle-income class households every Dec. 1 in the form of personal property tax,” Eigel said.
The bills drew criticism including from Otto Fajen of the Missouri National Education Association.
“What this bill is basically saying is, as you can see real property growth, you're not going to see any net increase in your revenues for some period of reassessment cycles,” Fajen said.
Other critics included representatives from the Missouri Association of County Developmental Disability Services, the St. Charles County Ambulance District and the O’Fallon Fire Protection District.
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