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City considers tax relief for poor seniors

If the homestead exemption is approved, it will apply to the 2006 tax cycle. Applicants' annual household income must be less than $22,693.

By AARON SHAROCKMAN
Published July 12, 2005

CLEARWATER - Fixed-income seniors may get an added tax break starting in 2006 to better control their rising property tax bills.

While the city's overall tax rate is expected to remain the same, city officials will consider extending an extra $10,000 homestead exemption to seniors 65 and older.

The tax break - the equivalent of $58 this year - would shave $100,000 to $150,000 from city tax revenues, budget officials estimated. To qualify, household income must be less than $22,693 a year, and the homeowner must have the standard $25,000 homestead exemption.

The idea is to give Clearwater's seniors some relief from climbing property values, Clearwater City Manager Bill Horne said. This year, the gross taxable value in the city increased by 15.5 percent, from $7.5-billion to $8.6-billion.

And though the statewide Save Our Homes program caps property value increases at 3 percent per year, some elderly residents can't keep up with the annual increases, city officials said.

"Given the overall concerns of our fixed-income seniors, the thinking was this was an affordable thing that we could do that we think would be good," Horne said.

Residents who qualify would receive an extra $10,000 homestead exemption from Clearwater taxes, meaning they stand to save $57.37 a year on their current property tax bill. If passed, the tax break will take effect for the 2006 cycle.

But the city does not know how many seniors would be eligible, budget director Tina Wilson said. More than 23,000 residents 65 and older live in the city, according to the U.S. Census Bureau - the highest proportion of any 100,000-plus city in the country.

Their incomes, however, are not known.

Also unknown is how many would actually file the needed paperwork, which is more intense than applying for the standard homestead exemption.

"We're looking at the values increasing," Wilson said. "Basically, it was time. We needed to do something for senior citizens."

Florida voters in 1998 changed the state Constitution to allow cities and counties to provide low-income seniors an additional homestead exemption on top of the $25,000 homestead exemption available to all homeowners.

So far, five Pinellas cities - Dunedin, Safety Harbor, Seminole, St. Petersburg and St. Pete Beach - have enacted the new homestead for seniors. It is still difficult to understand how well the new program has worked locally, said Pam Dubov, the county's chief deputy property appraiser.

In Dunedin, where city commissioners passed a $15,000 additional homestead, the city lost about $40,000 in revenue. St. Petersburg lost $79,000 in revenue by instituting a smaller $5,000 senior homestead.

Some people signed up for the program but then failed to renew in the second year, Dubov said. It wasn't worth it for the small reward, less than $35 in some cases.

"We have had a number of seniors who haven't bothered to fill out the paperwork," she said.

Clearwater leaders must pass the changes by Dec. 1 to make it onto next year's tax bill, Dubov said. A hearing date has not been scheduled.

[Last modified July 12, 2005, 01:26:22]