This morning the House Revenue and Taxation Committee agreed to hold a full hearing on House Bill 309 which would increase access to the state property tax deferral program. This program, first started in 2006, allows a homeowner to defer paying their property tax assuming their home has equity. The idea is that as home prices rapidly rise, homeowners could tap into the increased value to set up a lien. The state would then pay the deferred property taxes to the county. The homeowner would then have a lien put on their home to later reimburse the state for property taxes paid. The lien would come due when the home is sold or if the homeowner dies. House Bill 309 would increase qualifying household income from $40,000 to
$50,000. The qualifying household income amount would be increased annually according to the annual cost-of-living percentage modification starting in 2022. The interest rate would be lowered from 6% to the interest rate would then be calculated the same way that interest is calculated by the state for back payment on income taxes. The current interest rate is 2% for this year.
An update to the Circuit Breaker was also proposed today in the House Revenue and Taxation committee. House Bill 310 (co-sponsored by Representative Aaron Von Ehlinger and Senator Scott Grow) would allow medical costs to be deducted from income. The circuit breaker would
be increased from $1320 to $1500. An individual’s income, in order to qualify, would be raised from $28,000 to $31,900. House Bill 310 would also include an asset means test similar to SNAP. Homeowners would be allowed $20,000 in assets (with adjustment for inflation starting after 2021). However, something unique about this bill is that the means test would only be required if the home is worth more than the median assessed valuation for all homes in the county receiving the homestead exemption. Otherwise, the means test would not be required.
House Bill 308 which appropriates $47,200,000 to go through the Local Highway Distribution Fund (35% counties, 35% highway districts, 30% cities) will likely be heard on the House Floor later this week. Please reach out to your state representatives to encourage them to vote “yes” on House Bill 308.
Keep an eye on the House Health and Welfare Committee this week. There could be a bill introduced to shift the responsibility of funding for health districts from a joint responsibility between the state and counties, to just counties (in order to protect revenue sharing). The bill would also limit eligibility for indigent medical care to only those who do not qualify for Medicaid or have access to insurance, whether through buying on the exchange or through an employer. This would greatly reduce those who are eligible for aid through the CAT fund.