June 13, 2024

The Waco City Council passed new exemptions Tuesday, just ahead of a Saturday deadline, that are expected to shave hundreds of dollars from many homeowners’ tax bills.

The council increased the city’s homestead exemption from 10% to 15%, increased its exemption for homeowners 65 or older from $5,000 to $50,000, and added a new $50,000 exemption for homeowners with disabilities. The exemptions reduce the taxable value of an owner’s primary residence compared to its appraised value, subtracting the relevant percentage or the $50,000 from the appraised value. Properties that are not the owner’s primary residence, including apartments and other businesses, do not qualify for the exemptions.

The council broke with typical ordinance protocol that requires votes during separate meetings, and approved the ordinance as an emergency measure Tuesday, the first time it was formally introduced. City officials said the measure must pass before the city receives certified tax rolls from the appraisal district Saturday for the exemptions to go into effect before this tax season.

People are also reading…

“You have to operate off of your preliminary rolls and prior data in order to determine if you’re going to do this,” Budget Director Nicholas Sarpy said. “That’s why we have to do it pretty much today, under an emergency basis.”

Sarpy said the exemptions would deprive the city of $4.9 million in tax revenue from 2023 to 2028, based on preliminary values from the McLennan County Appraisal District.

Sarpy presented estimates from a previous meeting, explaining the owner of a $195,580 Waco home, the local average, could save about $75 in taxes per year. Homeowners 65 and older would save about $420 per year, and disabled homeowners would save $459 per year.

The appraisal district’s preliminary figures for 2022 show a 25.4% increase over last year in market value for owner-occupied Waco homes.

Council Member Jim Holmes said his constituents are nervous about rising home values, especially those who are elderly or on fixed income. He said there is already a 10% cap on how much a taxable value can increase each year, regardless of how quickly an appraised value increases.

“People take need to take a look at their tax statements and understand what a material effect this will have on taxes not only this year, but going forward,” Holmes said.

Holmes said he has also heard calls to consider renters. A 2020 study by the Harvard University Joint Center for Housing Studies found just under 49% of Waco-area renters pay more than 30% of their income for housing.

Source link