AGENDA ITEM 5B
October 28, 2014
Action
MEMORANDUM
October 24, 2014
TO:
FROM:
SUBJECT:
County Council
()dJ~
Josh Hamlin, Legislative
Attome~
Action: Bill 17-14, Property Tax Credit - Senior Citizens of Limited Income
Government Operations and Fiscal Policy Committee recommendation (3-0): enact the Bill
with amendments.
Bill 17-14, Property Tax Credit - Senior Citizens of Limited Income, sponsored by
Councilmembers Riemer, Andrews, Floreen, Branson, Navarro, Berliner and Council President
Rice, was introduced on March 4, 2014. A public hearing was held on April 29 and a
Government Operations and Fiscal Policy Committee worksession was held on October 20.
Bill 17-14 would double the amount of each year's property tax credit for senior citizens
of limited income from 25% to 50% of the State and County Homeowners' Property Tax Credit
awarded in that year.
Background
Current County law allows a property tax credit for homeowners at least 70 years old
who qualify for the County supplement to the State Homeowners' Property Tax Credit ("circuit­
breaker"). The amount of the current credit is 25% of the circuit-breaker supplement that the
taxpayer receives in that tax year. The taxpayer does not have to apply separately for this credit.
The taxpayer's application for the circuit-breaker credit serves to determine eligibility, as long as
the taxpayer shows that an owner-occupant of the property is at least 70 years old.
The 25% credit was established in 2006 by Bill 35-06 after the Maryland General
Assembly enabled counties to establish a credit. During discussion of Bill 35-06, the
Commission on Aging recommended setting the amount of the credit at 50%, but Bill 35-06 was
enacted with the credit set at 25%.
Public Hearing and Correspondence
There were three speakers at the public hearing. Joseph Beach, Director of Finance
testified on behalf of the Executive in support of the Bill (©9). He pointed out that since 2009,
the number of people aged 60 and over living at or below 100 percent of the federal poverty level
(FPL) has increased 30 percent, and the number living between 100 and 149 percent of the FPL
has risen 19 percent. Rudolph Oswald, co-chair of the Public Policy Committee of the
Commission on Aging, expressed the Commission's strong support for the Bill as an important
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tool to help many senior citizens stay in their homes (©10). Finally, Greg Ford, 2014 President
of the Greater Capital Area Association of Realtors (GCAAR), spoke on behalf of GCAAR in
support of the Bill (©11-12).
In
addition to the speakers, correspondence in support of the Bill
was received from the Community Action Board (©13-14), Manna Food Center (©15), and the
Primary Care Coalition (©16).
Issue/Committee Recommendation
Should the minimum age of eligibility for the credit be changed to 65 years old?
The 2006 State enabling law provided that the County could grant a credit to an
individual who is at least 70 years old.
In
2009, the Maryland General Assembly changed the
minimum age of eligibility for the credit from 70 to 65 years of age. Because an eligible
homeowner must be
at least
65 years old under State law, the County's higher age threshold is
permissible, but if there is a desire to expand the scope of the credit, the Committee may wish to
consider a corresponding change. Using the numbers in the Fiscal and Economic Impact
Statement provided for the Bill, staff estimates the additional cost of such a change as follows:
Using the numbers in the FEIS for the Bill as the starting point, if the credit is increased
from 25% to 50% of the circuitbreaker, the estimated program cost would go from this:
to this:
and if, in addition to increasing the credit, the pool of eligible recipients were
expanded to those age 65 and older, it would go to this:
Assumes average annual increases of 4%.
2
Assumes, per the HB78 I (2009) assumption, that persons between ages 65 and 69 are 30% ofall persons aged 65
and over.
I
2
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Committee Recommendation (3-0): Amend the Bill to make the minimum eligible age for the
credit 65 years old, as follows:
Add the following before line
4
ofthe Committee draft:
(a)
The Director of Finance must allow a tax credit each year against the general
County tax and all special service area taxes imposed on any real property that is
owned by, and is the principal residence of, an individual who:
(1)
(2)
is at least [[70)]
6.5.
years old; and
qualifies to receive either the state Homeowners' Property Tax Credit or
the County supplement to the Homeowners' Property Tax Credit under
Section 52-IIA, or both.
Add the following after line
6
ofthe Committee draft:
(c)
The Director must apply this credit automatically each year to the property tax
due from any eligible taxpayer. A taxpayer need not file an application, other
than
the application filed to receive the Homeowners' Property Tax Credit, to
receive this credit. To qualify for this tax credit, the taxpayer must show in that
application that at least one individual who owns and resides in the applicable
residence is at least [[70])
Q5.
years old.
Effective Date
As the Bill was introduced in March of this year, it was drafted to take effect on July 1,
2014. Staff recommends amending the effective date to July 1, 2015, so that the Bill can be
prospective
in
application.
This packet contains:
Bill
17-14
Legislative Request Report
Fiscal and Economic Impact Statement
Testimony:
Joseph Beach
Commission on Aging
GCAAR
Community Action Board
Correspondence:
Manna Food Center
Primary Care Coalition
MD Tax - Property Code Sec.
9-245
HB
781 (2009)
Fiscal and Policy Note
F:\LAW\BILLS\1417 Property Tax Credit For Senior Citizens\Action Memo.Doc
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Bill No.
17-14
Concerning: Prooertv Tax Credit ­
Senior Citizens of Limited Income
Revised: 10/20/2014
Draft No.l
Introduced:
March 4. 2014
Expires:
September 4. 2015
Enacted: _ _ _ _ _ _ _ _ __
Executive: _ _ _ _ _ _ _ __
Effective: _ _ _ _ _ _ _ _ __
Sunset Date:
-!.!.No::::;:n.:.::e~
_ _ _ _ __
ChI _ _, Laws of Mont. Co. _ __
COUNTY COUNCIL
FOR MONTGOMERY COUNTY, MARYLAND
By: Councilmembers Riemer, Andrews, Floreen, Branson, Navarro, Berliner and Council President
Rice
AN
ACT to:
(1) increase the amount ofthe property tax credit for senior citizens oflimited income;
and
(2) generally amend the County law regarding property tax credits.
By amending
Montgomery County Code
Chapter 52, Taxation
Section 52-11C, Property tax credit - senior citizens of
limited
income
Boldface
Underlining
[Single boldface brackets]
QQuble underlining
[[Double boldface brackets]]
* * *
Heading or defined term.
Added to existing law by original bill.
Deletedfrom existing law
by
original bill.
Added by amendment.
Deletedfrom existing
law
or the bill by amendment.
Existing
law
unqffected by bill.
The County Council for Montgomery County, Maryland approves the following Act.'
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BILL
No.
17-14
1
2
3
4
5
Sec 1. Section 52-11C is amended as follows:
52-11C. Property tax credit - senior citizens of limited income.
(a) The Director of Finance must allow a tax credit each year against the
general County tax and all special service area taxes imposed on any
real property that is owned by, and is the principal residence of, an
individual who:
6
7
(1)
is at least [[70]] 65 years old; and
(2)
qualifies to receive either the state Homeowners' Property Tax:
Credit or the County supplement to the Homeowners' Property
Tax: Credit under Section 52-11A, or both.
(b) For each taxable year, the credit under this Section equals [25%] 50% of
the total state and County credit awarded for that tax year under state
law and Section 52-11A.
(c)
The Director must apply this credit automatically each year to the
property tax due from any eligible taxpayer. A taxpayer need not file an
application, other than the application filed to receive the Homeowners'
Property Tax: Credit, to receive this credit. To qualify for this tax credit,
the taxpayer must show in that application that at least one individual
who
owns and resides
in
the applicable residence is at least
[[70]]
.65
years old.
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
*
Sec 2. Effective Date.
*
*
The amendment to Section 52-11 C
in
Section 1 of this Act takes effect on July
1, 2014 and applies to any tax year that begins on or after that date.
-2-
f:\law\bills\1417
property
tax
creditforseniorcitizens\bill
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LEGISLATIVE REQUEST REPORT
Bill 17-14
Property Tax Credit Senior Citizens ofLimited Income
DESCRIPTION:
Bill 17-14 would double the amount of each year's property tax
credit for senior citizens of limited income from 25% to 50% of the
State and County Homeowners' Property Tax Credit awarded
in
that
year.
The County wishes to increase financial assistance to residents most
in need.
!o provide additional property tax reliefto senior citizens oflimited
Income.
Office of Finance
To be requested.
To be requested.
To be requested.
To be researched.
Josh Hamlin, 240-777-7892
Tax credit applies Countywide.
PROBLEM:
GOALS AND
OBJECTIVES:
COORDINATION:
FISCAL IMPACT:
ECONOMIC
IMPACT:
EVALUATION:
EXPERIEN CE
ELSEWHERE:
SOURCE OF
INFORMATION:
APPLICATION
WlTmN
MUNICIPALITIES:
PENALTIES:
Not applicable.
F:\LAW\BILLS\l417 Property Tax Credit For Senior Citizens\LEGISLATlVE REQUEST REPORT.Doc
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ROCKVILLE, MARYLAND
MEMORANDUM
March 18,2014
TO;
FROM:
SUBJECT:
Craig Rice, President, County Council
Jennifer A. Hughes, Director, Office of
Joseph
F.
Beach, Director, Department
Managetll~g~
.
ofFinan~
t)'"
t.l
FEIS for Bill 17-14, Property Tax Credit-Senior Citizens of Limited Income
Please find attached the fiscal and economic impact statements for the above-referenced
legislation.
lAH:fz
cc: Bonnie Kirkland, Assistant Chief Administrative Officer
Lisa Austin, Offices of the County Executive
Joy Nunni. Special Assistant to the County Executive
Patrick Lacefield. Director, Public Information Office
Joseph F.
Beach.
Director, Department of Finance
Michael Coveyou, Department of Finance
David Platt, Department of Finance
Robert Hagedoom, Department of Finance
Jedediah Millard, Office of Management and Budget
Blaise DeFazio, Office of Management and Budget
Alex
Espinosa.
Office of Management and Budget
Felicia ZhRng. Office of Management and Budget
Naeem Mia. Office of Management Ilnd Budget
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Fiscal Impact Statement
Council Bill 17-14, Property
Tn
Credit - Senior Citizens of Limited Income
1. Legislative Summary
This
legislation would double the amount of each year's property
tax
credit for senior
citizens of limited income from
25
percent to
50
percent of the State and County
Homeowners' Property Tax Credit awarded that year.
2.
An
estimate of changes in County revenues and expenditures regardless of whether the
revenues or expenditures are assumed in the recommended or approved budget. Includes
source of infonnation, assumptions, and methodologies used.
Under the current program, the number of recipients was
3,063
in levy year
2012.
Finance assumes that the number of recipients
will
remain the same under the proposed
legislation. Also, under the current program, the average credit increased at an average
annual
rate of
4
percent. Therefore, Finance assumes that the average credit will increase
from
$179.15
in levy
20]2
to
$193.88
in levy year
2014
(fiscal year
2015).
The total
amount for the program, under the current program, would increase from
$548,733
to
approximately
$593,850
by levy year
2014.
The bill proposes to increases the
tax
credit from
25
percent or
50
percent thereby
doubling the amount ofthe average credit from
$193.88
to
$387.76
for each recipient.
Therefore, the total amount of the program would be approximately
SI,187. 700
in levy
year
2015.
Sources ofinfonnation: Department of Finance and the Department of Fjnance's
Tax
Expenditure Report,
June
2013
3. Revenue and expenditure estimates covering at least the next 6 fiscal years.
Finance assumes that the number of recipients
will
effectively remain constant through
the next six fiscal years with average annual increases of 4%.
FY15
FY16
FY17
FY18
FY19
3100
226.81
703,118
Recipients
Average Credit·
Total
3068
193.88
594,824
3100
201.64
625,069
3100
209.70
650,072
3100
218.09
676,075
FY20
3100
235.88
731,242
·Includes 4% average annuilllncreilse
4.
An
actuarial analysis through the entire amortization period for each bill that would affect
retiree pension or group insurance costs.
N/A
5. Later actions that may affect future revenue and expenditures if the biH authorizes future
spending.
N/A
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6.
An
estimate of the staff time needed to impleo:ent the bill.
The Department of Finance does not anticipate the need for additional staff time needed
to implement
Bill 17-14.
7.
An
explanation of how the addition of new staff responsibilities would affect other duties.
See
#6
8.
An
estimate of costs when an additional appropriation is needed.
N/A
9. A
description ofany variable that could affect revenue and cost estimates.
Variables affecting the cost ofthis
program
include the number of recipients and the rate
of the match to the County and State Homeowner's Property Tax Credit
(25
percent
currently,
50
percent proposed by
BiIl17~14).
10. Ranges of revenue or expenditures that are uncertain or difficuJt to project.
N/A
11.
If a bill is likely to have no fiscal impact, why that is the case.
N/A
12.
Other fiscal impacts or comments.
N/A
13. The following contributed to and concurred with this analysis: (Enter name and
department).
Jedecliah Millard - Office of Management and Budget
Robert Hagedoom - Department of Finance
Date
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Eeonomie Impaet Statement
Bill 17-14, Property Tax Credit - Senior Citizens of Limited Ineome
Baekground:
This legislation would double the amount of each year's property
tax
credit for senior
citizens of limited income from 25 percent to 50 percent of the State and County
Homeowners' Property Tax Credit awarded that year.
1. The sounes of information, assumptions, and methodologies used.
Department of Finanee,
Tax Expenditure Report,
June 2013.
The
report provides a description
and
data on the estimated number of recipients ofthe
senior
tax
credit and the amount ofthe credit. Based on the latest data for levy year 2012,
there were an estimated 3,063 recipients who received a total of 5548,733 or $179.15 per
recipient.
In
levy year 2011, the average credit was $173.81 and in levy year 2010, the
average credit was $165.40.
2. A deseription of any variable that eould afJeet the eeonomie impad estimates.
The variables that could affect the economic impact are the number of recipients and the
average credit. Under the current program, the number of recipients was 3,063 in levy
2012. Finance assumes that the number ofrecipients will remain the same under the
proposed legislation. Also, under the current program, the average credit increased at
an
average annual rate of4 percent. Therefore, Finance assumes that the average credit will
increase from $179.15 in levy 2012 to $193.88 in levy year 2014 (fiscal year 2015). The
total amount for the program, under the current program, would increase from $548,733
to approximately $593,850 by levy year 2014.
The bill proposes to increase the
tax
credit from 25 percent or 50 percent thereby
doubling the amount ofthe average credit from $193.88 to $387.76 for each recipient
Therefore, the total amount of
the
program would
be
approximately $1,187,700
in
levy
year
2015.
3. Tbe Bill's positive or negative effed, if any on employment, spending, saving,
investment, ineomes, and property values in tbe County.
The bill would have a positive economic effect on senior citizens who are currently
eligible for
the
senior
tax
credit. Their average annual disposable income would increase
from approximately $194 dollars per year to approximately $388 dollars per year. This
bill is not assumed to have a material effeCt on employment, investment, and property
values.
Page
1
of2
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Economic Impact Statement
BiD 17-14, Property Tax Credit - Senior Citizens of Limited Income
4.
If
a BiD is likely to have no economic impact, why is that the case?
See #3
5.
The foUowing contributed to and concurred with this
analysis:
David Platt and
Robert Hagedoom ofthe
Department
of
Finance.
Department of
Finance
J~7Bth~f'----
DatA
I
Page 2 of2
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TESTIMONY ON BEHALF OF COUNTY EXECUTIVE ISIAH LEGGETT ON
COUNCIL BILL 17-14, PROPERTY TAX CREDIT -SENIOR CITIZENS OF LIMITED
INCOME
April 29, 2014
Good afternoon, my name is Joseph Beach, Director of the County Department of
Finance and I am here on behalf of County Executive Isiah Leggett to testify in support of
Council Bill 17-14, Property Tax Credit - Senior Citizens Of Limited Income.
Council Bill 17-14 would double the amount of each year's property
tax
credit for low­
income seniors from 25% to 50% of the State and County property
tax
credit awarded that year.
The Executive supports this bill as it will help advance the "Senior Agenda" adopted by both the
County Executive and Council and support the work of the Senior Subcabinet on Vital Living.
This agenda has as its primary goal making Montgomery County a "community for a
lifetime"-a place where older adults can age in place/community, which extensive research
attests is the desire of over 90 percent of seniors. Housing costs in Montgomery County are a
significant barrier to low-income seniors being able to remain in their homes and neighborhood.
In Montgomery County, since 2009 the number of people 60 and over who are living at
or below 100 percent of the Federal poverty Level (FPL) has risen 30 percent, and the number
living between 100-149 percent ofFPL has risen 19 percent. In 2012, for residents 60 years of
age or older, 26 percent of Owner-occupied households spent 30 percent or more of their income
on housing and are considered "housing burdened." A doubling of the property tax credit would
bring needed financial relief to these senior households.
I urge the Council to support this legislation. Thank you for permitting me the time to
address the County Council on this important matter.
J
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COMMIssrON ON AGING
Apri129,2014
My name is Rudolph Oswald. I am co-chair of the Public Policy Committee ofthe Montgomery County
Commission on Aging. The Commission on Aging strongly supports the proposal to double the Montgomery
County's Senior Property Tax Credit.
It
will help many seniors with low incomes remain in their own homes.
It
meets one ofthe Commission's primary goals of aiding Montgomery County residents to age in place.
The state "circuit breaker," was first enacted in 1975 to meet low-income families with their real estate taxes.
The actual state credits have not changed since 2006. However property taxes and property evaluations have
continued to rise. Seniors are particularly vulnerable as many are on fixed incomes that do not rise with
inflation, and often face increases in health expenditures. While Social Security rises with inflation, most
pensions and savings in IRA's or other retirement accounts do not adjust to rising prices.
An
85 year old has
seen his or her once adequate income eroded through 20 or more years ofretirement without inflation
adjustments.
The
proposa~
updating the current County program for seniors age 70 and over is an important step in helping
low income residents stay in their own homes. The proposal adds 25% to the combined State Homeowners Tax
Credit and the County Supplement. The state criteria already limits the income level and the family net worth
for eligibility. The County may wish to review these criteria in terms of their application to Montgomery
County and its higher property evaluations.
The state criteria limits the tax credit to the first $300,000 ofproperty valuation. Many Montgomery County
properties have higher evaluations. Currently 3,063 are recipients of this County supplement to the "circuit
breaker". This proposal is a step to help those County residents most in need, but the program itself should be
broadened to meet the burdens on the near-poor. This program needs to be up-dated and better publicized.
The community that I live in is called Montgomery Square. It
is
situated at Seven Locks and Montrose Roads.
Similar to many other communities in the county, it was built 50 years ago. Initially, nearly every house was
populated with children. Now, 50 years later many ofthese same families still reside in the homes that
purchased to house their young families. Now instead ofworking families, there are retiree's families, older
couples, widows, widowers, and single retirees. Many have paid offtheir mortgagees and their biggest housing
cost is now their property bill. While their housing prices rise on paper, they translate into higher property tax
evaluations. They often are property rich, but income poor. Many ofthese homes initially sold for $40,000 to
$50,000. Now they sell for 10 to 15 times that value, which becomes incorporated into their property tax
evaluations. Retirement income has been eroded by time and inflation. Many are struggling with property tax
burdens, though they fail to meet the criteria ofthe state circuit-breaker income levels.
The Commission on Aging urges the Council to support this proposal that helps many long term residents stay
in their own homes.
Department of Health and Human Services
401 Hungerford Drive, 4th Floor, Rockville. Maryland, 20850 240-777-1120. FAX 240- 777-1436
www.montgomerycountymd.gov/hhs
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J
TESTIMONY OF
THE GREATER CAPITAL AREA ASSOCIATION OF REALTORS®
8EFORE THE MONTGOMERY COUNTY COUNCIL IN SUPPORT OF
Bill 17-14,
"Property Tax Credit- Senior Citizens ofLimited Income"
April 29, 2014
Council President Rice and members of the County Council, my name is Greg Ford and I am the
2014 President for the Greater Capital Area Association ofREALTORS® ("GCAAR") - the voice of
Montgomery County and the District of Columbia's more than 8500 REALTORS®, property
managers, title attorneys and other real estate professionals. On behalf of GCAAR, I would like to
voice our support for Bill 17-14,
"Property Tax Credit-Senior Citizens ofLimited Income."
GCAAR commends the Council for introducing Bill 17-'14, aimed at helping senior property owners
oflimited means age in place. As housing prices rise, our members recognize corresponding
property taxes can become one of the biggest expenses for those living on a fixed income such as
senior citizens or those facing retirement. Raising the current Senior Citizens of Limited Income
Property Tax Credit ("Credit") rate from 25% of the combined State Homeowners' Tax Credit and
County Supplement to 50% will certainly ease mounting cost ofliving burdens for eligible residents.
GCAAR would further encourage the CoUncil to take Bill 11-14 further by expanding its eligibIlity
requirements. First and foremost, we recommend amending the definition of 'limited income' to
allow for a greater number of senior citizens eligible for the Credit.
It
is our understanding that even
senior citizens only receiving around $30,000 from Social Security proceeds (near the County's
poverty limits) may not qualify for the Credit based on the current calculation formula. Our
Association believes
it
would be reasonable to allow for senior citizens living on such low and
moderate incomes to qualify for the Credit.
We also recommend the Council consider opening the benefits of Bill 17.,14 to include all persons
with disabilities of limited income, as they are amongst the most vulnerable of the County's
popUlations. Unfortunately, residents with disabilities are often unable to work and any income they
may receive is barely enough to cover their essential living expenses. Allocating for a modest
property tax credit could help them put those funds towards critical medical costs or care.
Finally, GCAAR asks the Council to evaluate options for offering additional property tax credits to
the widows of veterans. While we are aware of certain property tax benefits for veteran's widows, to
our knowledge these are limited to the homes they occupied with their late spouses. Our membership
values the commitment our soldiers and their spouses make to our Country and believe the widows of
veterans deserve to carryover any property tax benefits they receive if they choose to move homes.
I
@
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Overall, GCAAR strongly supports the goal of Bill 17-14 and sees it as an opportunity to give even
more of our most vulnerable residents living on limited income the ability stay in their homes. We
urge the Council to expand the pool of senior citizens who qualify for the Credit by increasing its
income eligibility limits, as well as consider offering the benefits to the disabled and veterans'
widows.
GCAAR sincerely thanks the members of the County Council for consideration of our Association's
perspective on these very important issues.
2
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VfJctlonk
PARTNERSHIP
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ACllIII'!unlfy
Montgomery County Community Action Board's
County Council Testimony
Tuesday, April 29, 2014
Walter Woods, Jr.
Community Action Board Chair
Good afternoon Mr. President, and members of the Montgomery County
Council.
My name is Walter Woods, Jr., and I am the Chair of the Community Action
Board of the Montgomery County Community Action Agency, the county's
anti-poverty group and governing board for Head Start and the Community
Service Block Grants (CSBG).
2014 is an important year for the Community Action Agency, as it marks
the 50
th
anniversary of the War on Poverty. We have been advising the
County Council about key matters affecting people in poverty since 1968.
I would like to start by thanking the County Council for its ongoing efforts to
address the needs of low-income residents in the County. We are
especially grateful for your leadership in addressing gaps in CSBG funding,
supporting affordable housing through the 100,000 Homes. Campaign,
restoring EITC funding for County residents through the Working Families
Income Supplement legislation, for raising the minimum wage, and for
adding funding to WPA.
The bill before us today would continue the Council's efforts to assist some
of the most vulnerable members of our community. Although Montgomery
County is one of the eleven wealthiest counties in the country, poverty
remains a significant concern. 6.5% of residents, or 63,154 people, live
below the Federal Poverty Line. Although this number is significant, the
2012 Family Self-Sufficiency Standard is a far more accurate measure of
what it actually costs to live in the County.
@
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For over 20 years, our Community Action Board has supported the use of
the Self-Sufficiency Standard to reflect the true cost of living in Montgomery
County,
which is why we have requested ongoing funding from the
County Council to maintain the production of the Self-Sufficiency
Standard, and tie it with Census data.
The Self-Sufficiency Standard measures how much income a family of a
certain composition in a given place needs to adequately meet their basic
needs without public or private assistance. Due to the high cost of living in
the County, the Self-Sufficiency Standard is significantly higher than the
Federal Poverty Line. For example, the Federal Poverty Line is $11,670 for
a single adult, but the Self-Sufficiency Standard for a single adult in
Montgomery County is $36,060.
The Community Action Board strongly supports tax credits as an effective
way to address the needs of low-income residents and expand affordable
housing in the County. The 2012 Self-Sufficiency Standard for Maryland
indicates that the cost of housing in the County has increased by 62%
since 2001, vs. 50% statewide. During this same period, wages have only
increased by 17%. Bill 17-14, the Senior Property Tax Credit, will increase
the property tax credit for low-income seniors, a demographic group that
will continue to grow in the coming years. This legislation will be
particularly helpful because it targets those who are 70+ years old. As
seniors age, poverty increases; especially for those over age 75.
Our analysis of the American Community Survey indicates that 29,809
County residents 65 or older have incomes less than 3 times the Federal
Poverty Level. This number reflects
one quarter
of
all
seniors in
MontgO'Fllery County. Because this legislation will aHow for a progressive
tax credit, seniors with the lowesfincomes will benefit the most.
In conclusion, we ask that you support low-income seniors through
passage of Bill 17-14. This legislation will serve as an effective tool in your
ongoing efforts to address the needs of the increasing number of low­
income seniors throughout Montgomery County.
Thank you President Rice and members of the Council for your time.· We
hope we'll
see
you on May
2tt'
at
CAB's
Community Action Month event to
acknowledge leaders in the community dedicated to eliminating poverty in
Montgomery County.
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food center
ftghtmg
hunger
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feeding _ I n
mot1tgome<y
county
TO:
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RE:
DT:
Councilmember Hans Riemer
Jackie DeCarlo, Executive Director
The senior property
tax
credit
Apri129,2014
Manna Food Center is working to end hunger in Montgomery County by sharing food on a daily
basis with individuals and families who experience food insecurity and often lack access to
healthy, nutritious meals. Many of our program participants are seniors who are living on fixed
incomes and struggling to cover the costs of housing, food, and medical care. Manna
collaborates with the Housing Opportunity Commission to distribute food to seniors in several
communities.
Just last week I received a handwritten thank you note from a woman in Bethesda. She said,
"I want to thank you for giving me food each month. I am 87 years old and used all my
resources up-just lived too long. It really means a lot to have extras as I only get $15.00
in food stamps."
Because seniors often have limited fmancial resources, even as participants in existing social
service programs, Manna support efforts to help seniors stretch their budget to maintain a
dignified quality of life. We know that the poverty-related issues impacting our vulnerable
neighbors-such as the cost of housing for seniors-- are inter-related and complex. We
appreciate your leadership in creating opportunities to strengthen our County's social safety net.
9311 Gaither Rd Gaithersburg, MD 20877
www.mannafood.org
N
N
240.268.2524 '" Jackie@mannafood.org
Twitter @mannafoodcenter
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primary care coalition
of Montgomery
Marylana
April 29, 2014
Montgomery County Council
100 Maryland Avenue
Rockville, MD 20850
8757 Georgia Ave
10th
Floor
Siiver Spri'lg, MD
Re: Bill
17-14,
Senior Property Tax Credit
Dear Montgomery County Council Members:
I am writing today to express my support, and the support of the Primary Care
Coalition (PCC), for Bill 17-14 that doubles Montgomery County's Senior Property
Tax Credit.
For years, the PCC has partnered with the County, along with 12 independent
clinics, five hospitals, and a host of private providers, to provide access to health
services for low-income residents who are not eligible for state or federal
insurance programs. In Fiscal Year 2013, 8 percent of the low-income patients
receiving health services through Montgomery Cares were age 65+.
What has become evident over our years is that health is about more than access
to care; it is also about the social and environmental factors that have an impact
on a person's health status. Having a roof over your head is a fundamental need.
Housing protects us from the elements and gives us a safe place to rest.
Because older adults often live on limited fixed incomes, it can be difficult to find
affordable housing, especially in this time of rising rents. Bill 17-14 will improve
economic security and ease the burden of finding affordable housing so that older
adults living in Montgomery County no longer have to make the choice between
housing, food, transportation, health care, or other basic necessities.
Sincerely,
2CfF
0
T:
301.628,3405
F: 301.6082384
Steven M. Galen
President and CEO
Primary Care Coalition
wl/vw.primarycarecoalitlon.org
1
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Page 1
LexisNexis@
loflDOCUMENT
Annotated Code ofMaryland
Copyright
© 2014
by Matthew Bender and Company, Inc., a member of the LexisNexis
Group
All rights
reserved.
*U
Statutes current through emergency legislation effective May
15,2014,
and legislation effective June
1,2014
*u
u*
2014
General Assembly Regular Session
*u
"' .. Annotations current through May
1, 2014
*"''''
TAX - PROPERTY
IDLE
9.
PROPERTY TAX CREDITS
AND
PROPERTY TAX REliEF
SUBTITLE
2.
STATE~EOPTIONAL
GO TO MARYLAND STATUTES ARCHIVE DIRECTORY
Md. TAX-PROPERTY Code Ann.
§
9-245 (2014)
§
9-245.
Credit for individuals at least
65
years old
(a) In general. - The Mayor and City Council of Baltimore City or the governing body ofa county or ofa municipal
corporation may
grant,
by law, a
tax
credit against the county or municipal corporation property
tax
imposed on real
property that
is
owned by and used
as
the principal residence of an individual who is at least
65
years old and of limited
income.
(b)
Amount, duration, eligibility and regulations. -- The Mayor and City Council of Baltimore City or the
governing body of a county or municipal corporation may provide, by law, for:
(1)
the amount and duration of the property
tax
credit under this section;
(2)
additional eligibility criteria for the
tax
credit under this section;
(3)
regulations and procedures for the application and uniform processing of requests for the tax credit; and
(4)
any other provision necessary to carry out this section.
mSTORY:
2006,
ch.
455; 2009,
ch.
416.
NOTES:
EFFECT OF AMENDMENTS. --Chapter
416,
Acts
2009,
effective June
1, 2009,
substituted
"65
years" for
"70
years" in (a).
EDITOR'S NOTE. -Section
2,
ch.
455,
Acts
2006,
provides that the act shall take effect June
1,2006,
and shall be
applicable to all taxable years beginning
after
June
30, 2006.
@
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Page 2
Md. TAX-PROPERTY Code
Ann.
§
9-245
Section 2, ch. 416, Acts 2009, provides
that
"this Act shall take effect June 1,2009, and shall be applicable
to
all
taxable years beginning after June 30, 2009."
LexisNexis 50 State Surveys, Legislation
&
Regulations
Archaeological and Historic Sites
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HB781
Department of Legislative Services
Maryland General Assembly
2009 Session
House Bill 781
Ways and Means
FISCAL AND POLICY NOTE
Revised
(Delegate James,
et aZ.)
Budget and Taxation
Property Tax Credit - Seniors
This bill lowers the minimum age requirement, from 70 to 65 years of age, for the
existing local property tax credit for senior citizens of limited income.
The bill takes effect June 1, 2009, and applies to all taxable years beginning after
June 30, 2009.
Fiscal Summary
State Effect: None.
Local Effect: Assuming local governments grant the tax credit, county and municipal
property tax revenues may decrease by a significant amount beginning in FY 2010
depending on the amount of the tax credit granted and the number of eligible recipients.
Under one set of assumptions, county revenues may decrease by $10.9 million and
municipal revenues may decrease by $637,800. County and municipal expenditures are
not affected.
Small Business Effect: None.
Analysis
Current Law: Chapter 455 of 2006 authorized Baltimore City, counties, and
municipalities to grant a
tax
credit against the county or municipal property
tax
imposed
on real property that is owned and used as the principal residence of an individual who is
at least 70 years old and of limited income. Local governments are authorized to provide
for the amount and duration of the tax credit, additional eligibility criteria for the
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tax credit, regulations and procedures for the application and uniform processing of
requests for the tax credit, and any other provisions necessary.
Background: The Homeowners' Property Tax Credit Program (Circuit Breaker) is a
State-funded program
(i.e.,
the State reimburses local governments) providing credits
against State and local real property taxation for homeowners who qualify based on a
sliding scale of property tax liability and income. Exhibit 1 shows the number of
individuals qualifying for the tax credit and the total cost of the program since
fiscal
2005,
as referenced in the State budget.
Exhibit 1
Homeowners' Property Tax Credit Program
Fiscal 2005-2010
Fiscal Year
2005
Actual
2006
Actual
2007
Actual
2008
Actual
2009
Estimated
2010
Allowance
Eligible "
Annlications
48,666
46,628
48,290
46,618
46,000
46,000
State
Funding
$39.5
million
41.7
million
45.6
million
45.2
million
47.2
million
45.6
million
Average
Credit Amount
$812
893
944
971
1,026
991
Source:
Maryland State Budget Document for Fiscal 201 0, Volume 1
Local Fiscal Effect: County and municipal property tax revenues may decrease
beginning in fiscal
20
I 0 to the extent that local jurisdictions grant the property tax credit
authorized by the bill. However, the actual amount of the revenue decrease depends on
the amount of any credit granted and the number of eligible homeowners. Exhibit 2
shows,
for illustrative purposes only,
a potential effect on local governments of granting
a
50%
locai property tax credit for individuals who are
65
to
69
years old and of limited
income. The estimate is based on the following facts and assumptions:
average assessment data for the tax year beginning July
1, 2008;
current local property tax rates;
limited income is defined "as homeowners currently eligible for the Homeowners'
Property Tax Credit Program (Circuit Breaker);
HB 781/Page 2
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the homeowners' property tax credit was issued
to
33,832 homeowners who are at
least 65 years old in fiscal 2009; and
individuals who are between the ages of 65 and 69 are 30% of all individuals ages
65 andover.
The actual local impact will vary depending on the number of local jurisdictions granting
a property tax credit and the eligibility requirements developed by each jurisdiction.
Additional Information
Prior Introductions: None.
Cross File: None.
Information Source(s): State Department of Assessments and Taxation, Maryland
Department of Planning, Department of Legislative Services
Fiscal Note History:
ncslhlb
First Reader - March 3,2009
Revised - House Third Reader - March 28, 2009
Analysis by: Michael Sanelli
Direct Inquiries to:
(410) 946-5510
(301) 970-5510
lIB
7811
Page 3
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Exhihit2
Potential Impact of a 500/0 Tax Credit for Homeowners Ages 65-69
Eligible
County
Allegany
Anne Arundel
Baltimore City
Balfunore
Calvert
Caroline
Carroll
Cecil
Charles
Dorchester
Frederick
Garrett
Harford
Howard
Kent
Montgomery
Prince George's
Queen Anne's
St Mary's
Somerset
Talbot
Average
Assessment
$91,404
381,086
135,657
257
2
944
348,201
198,075
320,822
243
1
002
314,877
179,787
328,388
133
1
450
268,904
446,077
246,878
525,271
292,894
383,231
291,240
126,680
449,024
219,902
173,760
284,828
$276,724
Tax
Rate
$0.9829
0.8880
2.2680
1.1000
0.8920
0.8700
1.0480
0.9600
1.0260
0.8960
1.0640
1.0000
1.0820
1.1495
0.9720
0.9150
1.3190
0.7700
0.8570
0.9200
0.4490
0.9480
0.8140
0.7000
TaxI
$291
2,593
2,036
1,987
2,046
1,009
2,198
1,354
2,169
866
2,244 .
790
1,~44
Residents
65-69
2
207
856
2,231
1,429
135
66
426
185
184
88
467
93
538
408
40
50%
Tax Credit
($30,122)
(1,109,570).
(2,270,445)
{1,419,5091
(137,701)
(33,188)
(468,622)
(125,240)
(199,060)
(38,050)
(523,581)
(36,787)
(469,034)
(761,298)
(31,317)
(1
2
398 z
672}
(1,307,994)
(96,831)
(121,444)
{14,91O}
(16,780)
(197,339)
(46,955)
{47,354}
($10,901,805)
($637,756)
3,732
1,584
3,760
2,549
2,121
1,592
530
1,425
1,150
675
1,293
744
1,026
91
153
56
24
343
139
73
10,000
Washington
Wicomico
Worcester
Total
Municipal Decrease
Note:
1
After
application ofhomeowners' property
tax
credit.
2
Local governments
are
already authorized
to
grant a property
tax
credit to homeowners who
are
at
least 70 years old and oflimited income through Chapter 455 of2006.
HB
781 / Page 4