A little help for seniors

On January 13, 2008, in News 2008, by Mark Norris

Commercial Appeal
January 13, 2008

The Memphis City Council stepped out where few local governments in Tennessee have dared to tread last week, unanimously approving a plan to freeze city property taxes for low-income seniors.

In an Associated Press count reported in December, only seven Tennessee counties had acted on the constitutional amendment approved by voters in 2006 that authorized local governments to enact a freeze.

That seems like an example of government inertia, but it’s appropriate in this case. Technically voters did not make a final decision on the tax freeze itself, and local legislative bodies are correct to be cautious.

Their responsibilities are to provide careful stewardship of public resources while maintaining a level of public services that the public expects. And even without a freeze in place, there’s no impact on anyone until local governments also decide to raise the property tax rate.

A decision on the freeze will be difficult in Shelby County government, where Mayor A C Wharton has been campaigning for enactment of a new privilege tax on workers whose jobs are in Shelby County to help offset an estimated $14 million government funding gap for the budget year that starts in July.

But the amendment’s 83 percent statewide approval rate — 81 percent in Shelby County — sent a clear message to local legislators throughout Tennessee that citizens eventually expect some action on behalf of struggling seniors.

Legislation setting guidelines for enactment of the tax freeze — championed in the legislature by Sen. Mark Norris, R-Collierville — was crafted by the General Assembly last spring.

The city freeze, which will be available only to residential property owners in Memphis 65 years of age and older who earn less than $32,590, the city’s median income, is relatively cheap in the short run.

When there is an increase in the city property tax rate, it will cost the city $70,000 for every one-cent increase, city finance director Roland McElrath told council members prior to approval.

Of course, those dollars could add up to a significant sum in the long run. The trade-off is needed help for responsible low-income seniors who have managed to become property owners through years of hard work and frugal living and are barely hanging on while the cost of everything they purchase, from food to utilities to prescription medications, is making keeping their homes a more difficult month-to-month challenge.

Helping seniors keep their homes also pays dividends in the form of neighborhood stability. Abandoned properties can quickly deteriorate, depressing the value of nearby property and creating havens for drug dealers and gangs.

A growing property tax bill is one of many factors that can drive people outside the city, where there is at least the perception of a lower cost of living.

There was some confusion about whether the freeze would help property owners in the case of a reappraisal that raised the value of the home even though no improvements had been made to the property.

Fairness would dictate that low-income seniors would not be hit with higher tax bills as a result of a routine reappraisal, either.

In whatever manner their taxes are raised, tax hikes can cause the quality of life to deteriorate for some of the city’s most vulnerable citizens.

An estimated 14,000 to 15,000 Memphians are believed to be qualified for the freeze. City Hall should do what it can to encourage them to take it.

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