STRATEGIC PRIORITY: Government Performance and Financial Management
AGENDA DATE: June 9, 2021
COUNCIL DISTRICT(S): N/A
DEPARTMENT: Budget and Management Services
EXECUTIVE: Elizabeth Reich
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SUBJECT
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Authorize an increase in the homestead property tax exemption for persons who are disabled or 65 or older from $100,000 to $107,000 beginning with the 2021 tax year (fiscal year beginning October 1, 2021) - Estimated Annual Revenue Foregone: $2,413,664
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BACKGROUND
The City of Dallas grants a homestead exemption of 20 percent or a minimum of $5,000 of the market value of residence homesteads. An additional exemption of up to $100,000 of the market value is granted to those persons who are disabled or 65 or older. The $100,000 exemption has been in effect since tax year 2019.
On December 13, 2017, City Council added Financial Management Performance Criteria (FPMC) #23 that requires a comparison of the current exemption for individuals who are disabled or 65 or older to the most recent annual Consumer Price Index (CPI) every two years.
On June 9, 2021, City Council is scheduled to approve an amendment to FMPC #23 that requires the City to compare the current disabled and over-65 exemption to the most recent annual Consumer Price Index for the Elderly (CPI-E) and the year-over-year change in the average residential market value (whichever is greater) annually and provide the analysis of each scenario to City Council for consideration. The proposed increase recognizes the year-over-year change in the average market value; therefore a $107,000 exemption is proposed. The increase applies to the 2021 tax year (fiscal year beginning October 1, 2021).
Options
Exemption Increase
Total Exemption
Annual Revenue Foregone
Incremental Savings to $323,813 Home
CPI-E combined 2021 & 2020
$3,800
$103,800
$1.3M
($29.50)
Average Residential Market Value Change
$7,000
$107,000
$2.4M
($54.34)
PRIOR A...
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