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Consider an alternative to tax exemption for seniors
© St. Petersburg Times, published January 3, 2001 Less than two years ago, it was posed as a $5-million question. Now the worse-case figure used is $8-million. Truth be told, the cost of an additional property tax exemption for low-income senior citizens will never be known unless the Pasco County Commission moves forward with one. We urge caution in considering such an idea even though aiding needy seniors is worthwhile. Any tax cut for one segment of the population will mean a higher overall rate for everyone else or a corresponding cut in services. Pasco County's close proximity to the state constitutional tax rate limit means the service cuts are more likely. We've noted previously what a $5-million loss in county revenues could translate to: closing all county libraries, or a layoff of 71 road patrol deputies and foregoing the purchase of automobiles and other equipment, or cutting the fire/rescue budget by two-thirds and forcing volunteers to handle the majority of 6,000 fire calls and 12,200 ambulance dispatches annually. The tax proposal, approved by voters as constitutional Amendment 3 in the 1998 election, allows local governments the option of granting an extra exemption for people 65 and older who earn less than $20,000 annually. But it is filled with inequities. Property appraisers have been saddled with the responsibility of verifying who qualifies for the exemption, which is in addition to the abatement already given for the first $25,000 of property assessment for all Florida homeowners. What the process does not take into account is the difference between income and worth, which leaves the process open for abuse by those the exemption really isn't intended to benefit. Should an over-65 senior who has paid for and lives in a $200,000 home, but whose income is less than $20,000, be granted the additional homestead exemption? Is it fair to give a tax break to someone who may have amassed substantial wealth in real estate, savings, or tax-exempt securities that is not counted as income? In addition, the law discriminates against eligible seniors who rent instead of own their homes. Property appraiser Mike Wells, relying on state data, previously estimated 28,000 homeowners in Pasco could be eligible. He figured his office would need four new employees, costing $22,000 in salary and benefits each, to process the applications. Today, the Pasco County Commission will consider a report from budget director Mike Nurrenbrock that estimates a maximum of 33,000 households could be eligible, costing more than $8-million in loss revenue to the county. Both are obvious worse-case scenarios. We note the first-year outcome in neighboring Hillsborough County was much less widespread than anticipated. The county estimated a $4-million loss in revenue -- the state figured $5-million -- after it approved the measure. Instead, the county lost only $620,000 when 5,167 senior citizens received the exemption. The county had expected 12,000 to be eligible. It is difficult to draw conclusions in Pasco County based on the first-year history elsewhere. Hillsborough County is younger and wealthier. Compared with Pasco, per capita income is significantly higher in Hillsborough and people 65 and older make up only 13 percent of its population. The figure is 32 percent in Pasco County. Still, elected officials here might find themselves tempted to begin a program in Pasco modeled after a couple of Pinellas County cities that granted exemptions of $5,000 and $10,0000, instead of the full $25,000. Here's a better idea. If the county is truly concerned about helping financially troubled senior citizens, commissioners should bump up their annual allocation to social service agencies, which hasn't increased in 13 years. Giving additional dollars to groups that have already identified needy senior citizens is more sensible than the alternative. It is easy to implement and carries a definitive cost. It is just less sexy than the always politically popular tax cut. So which is more important? Serving needy senior citizens or self-serving pols?
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