MADISON – The Board of Selectmen voiced its support for a revamped senior tax relief plan on Monday before unanimously voting to move the proposal toward a public hearing.
The revision, which took a year to complete, combines the town’s two current tax abatement and tax freeze plans. First Selectman Peggy Lyons said the proposal would need to be in place by Feb. 1, when applications open for the tax relief program.
She also suggested holding an additional information session at the senior center before the public hearing to allow potential applicants to ask questions.
“I would think the public would be fairly supportive of it, given that it’s a larger benefit and more of a simple process,” Selectman Scott Murphy said.
But Selectman Bruce Wilson said the public might view the revised plan as an opportunity for wealthy shoreline homeowners to maneuver a tax break.
“I think the public challenge is misreading this for the proverbial oceanfront house getting a tax steal and it’s not,” he said. “Somebody who can modulate their income would still have to pass the house value gate.”
The tax relief program, which is for residents aged 65 and over and community members with disabilities on a fixed income, has three qualifiers: income, property value, and time in residence in town.
“The three qualifiers that we put in helped a lot with folks who thought this was an improper giveaway program,” Selectman Al Goldberg said.
“I think that was one of the things when we wrestled with this, is that the purpose for the freeze was to reward people who have been in town a long time, paid their taxes, put their children through the school district, and now we’re here to provide them relief,” Lyons added. “We wanted to make sure that is what they felt. This does simplify. You get a benefit for being here a long time.”
Beach, Recreation, and Senior Services Director Austin Hall, who presented the proposal to the board, said the new plan would also provide clarity regarding future property tax bills for residents.
“It simplifies it for the residents,” he said. “You get the greater of the benefits. Sometimes that’s difficult to explain to folks. Now, if you apply and you qualify, you get both benefits. Folks who are enrolled and qualify, they’re going to get a greater benefit. This is a great way to keep people in town, keep older folks and disabled folks in their home. Respecting how long they’ve lived in town and contributed to town.”
Combining the local tax abatement and the tax freeze programs would make the application process easier and more effective for seniors and people with disabilities in town, he said.
“Qualified applicants will receive both the abatement and the freeze if they’ve owned the home for over 10 years or more,” he said. “If you’ve owned your home for less than 10 years, you’ll receive the local tax abatement benefit only. There are some folks we’ll grandfather in. Those applicants received the tax abatement benefit which was higher than the freeze benefit, so they would see no financial impact at all from the changes we’re proposing.”
Income qualifications, he explained, are based on the area’s median income and are tiered. The revised plan would also do away with the separate married and unmarried structure. Another qualifier allows participants who are delinquent in taxes to participate in the tax relief program.
Hall said the revised plan doesn’t forgive the delinquent taxes, but allows qualifying people to participate and hopefully catch up on their taxes.
The revised plan would have a maximum assessed property value of $392,600 to qualify, but would be adjusted annually, Hall said, by the consumer price index.
Additional perks include a $500 benefit category to residents in the highest income tier, as well as a $250 longevity bonus benefit for those with 30 years or more of consecutive residency. And if a property owner dies, tax relief program eligibility would still be available for the surviving spouse.
In the past, he said, if an individual’s income surpassed the maximum qualifying threshold in a given year, it would disqualify the applicant. But the revision would forgive the excess three times per lifetime.
Another change would allow an affidavit to be used to claim medical expenses in place of IRS Schedule A.
“A lot of folks don’t file a Schedule A anymore,” Hall said. “The standard deduction is so high, a lot of folks don’t use that anymore.”
The senior tax relief program allows the town to use up to 1 percent of its operating budget for the program, Hall said; it’s currently at 0.42 percent. If the program should reach 0.7 percent, the Board of Finance would be required to review it and make recommendations.
The public hearing on the topic is scheduled for Nov. 15 at 6 p.m. in the Hammonasset Room at Town Campus and via Zoom.