Tax break for seniors on table again

New figures show the county might not lose as much as some feared if it passes an extra $25,000 homestead exemption for low-income seniors.

By EDIE GROSS

© St. Petersburg Times, published August 2, 2000

Concerned about losing an estimated $7.7-million in tax revenues, Pinellas County commissioners balked last year at giving low-income seniors a special $25,000 homestead exemption on their property taxes.

But commissioners will reconsider that decision in the coming weeks after learning that other Florida counties that approved such an exemption did not lose nearly as much money as they thought they would.

For instance, the state Department of Revenue estimated that Hillsborough County would lose $4-million in tax revenues if it granted low-income seniors a larger homestead exemption last year. But the county lost only $620,000 after offering seniors a $15,000 homestead exemption on top of the $25,000 exemption everyone else gets.

That's less than 16 percent of the original estimated loss.

Based on results in Hillsborough and two other counties, Pinellas officials now estimate that the revenue loss to the county might be in the range of $1.8-million to $3-million if they instituted the tax break.

If the county approved a $25,000 exemption for seniors under the coming year's proposed tax rate, a qualified homeowner would save about $168.75 a year. If commissioners approve the tax break, however, it would not take effect until at least the following year.

"I think the original estimates were highly inflated," said Pinellas County Commissioner Bob Stewart, who asked County Administrator Fred Marquis to bring new figures to commissioners during the next two weeks.

"Now with this information, it seems to me it would be appropriate to go back and . . . let's get a re-evaluation and see if this is something we might want to give reconsideration to," Stewart said.

Under a constitutional amendment approved by Florida voters in fall 1998, counties and cities can give up to $25,000 in an extra homestead exemption to people 65 or older whose annual household incomes are $20,000 or less. The tax break amendment earned the support of 64 percent of the voters in Pinellas County.

Twenty of the state's 67 counties have passed some form of the exemption as have 50 cities. But Pinellas officials shied away from the break when the state suggested the county stood to lose $7.7-million.

That figure was based on the assumption that 51,175 properties would be eligible for the extra exemption. But studies of the tax break in Hillsborough, Broward and Duval counties showed that many property owners either did not apply for the exemption or did not qualify under the rules.

To apply, seniors must submit their income tax returns to verify their incomes. The Property Appraiser's Office would have to sort through the information to see who qualifies.

Pinellas Property Appraiser Jim Smith said the financial benefits to individual homeowners are not overwhelming, but the county stands to lose a lot of money it could use on needed infrastructure. He might also need to hire more employees a few years down the line to handle all the applications.

"It's going to be an interesting phenomenon," he said. "It's not great for the individual, but it can be super debilitating to the government."

Commissioner Karen Seel said she supports giving the tax break a second look. She said she has received calls from older residents who could benefit from the extra exemption.

"I've gotten so many heartfelt calls," she said. "I think we have a lot of people living on the edge here."

- Information from Times files was used in this report.

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