Title
Ordinance to Amend and Re-Enact Chapter 37, Article II of the Code of the City of Hampton Entitled “Real Estate Taxes” by Amending Division 6, Sections 37-123, 37-125 and 37-129 Pertaining to Certain Qualified Elderly and Disabled Persons Grandfathered Under the Prior Tax Exemption Program
Purpose
PURPOSE/BACKGROUND:
On May 14, 2014 by Ordinance No. 14-0006, Council amended Chapter 37, Article II, Division 6 of the Code of the City of Hampton pertaining to certain qualified elderly and disabled persons. The amendment eliminated the option pertaining to the exemption of that portion of the real estate tax owed by a qualified elderly and disabled taxpayer leaving the deferral and freeze options available.
On August, 13, 2014 by Ordinance No.14-0016, Council amended Chapter 3, Article II, Division 6 to grandfather those individuals qualified and claiming an exemption as of July 1, 2013 and also having an existing mortgage. Those individuals would continue to be eligible for the tax exemption program until the mortgage was paid off. At the time of pay-off, the individual would be eligible for tax deferral or tax freeze.
Since the adoption of Ordinance No. 14-0016, the City Manager and City Council have been aware of certain difficulties or unintended consequences this amendment will have on certain qualified elderly and disabled persons who have an existing mortgage.
The proposed amendment eliminates the requirement of having an existing mortgage and the provision that at the time of pay-off of the mortgage, the individual would be eligible for tax deferral or tax freeze. Simply stated all individuals who were qualified and claiming an exemption as of July 1, 2013 would be grandfathered regardless of whether they had an existing mortgage. Income and financial worth limitations still apply. The individual must apply every year for the exemption and if they exceed income or financial worth limitations, the exemption is nullified. However, the individual could always seek a tax deferral or freeze.
Discussion:
None.
Impact:
Not applicable.
Recommendation:
Rec
Approval of the ordinance.
Body
DIVISION 6 DEFERRAL OR FREEZE FOR ELDERLY AND DISABLED PERSONS
. . . .
Sec. 37-123. Grandfathering of qualified persons under the prior tax exemption program
(a)
Notwithstanding any provision in this division to the contrary, a person qualifying and claiming an exemption as of July 1, 2013, shall be grandfathered into the tax exemption program and shall continue to be eligible to apply annually for the tax exemption program.
(b)
Such persons grandfathered into the tax exemption program shall be required to adhere to the income limitations and financial worth limitations set forth in the prior tax exemption program and the amount of the tax exemption shall continue as shown on the following schedule:
Combined Income Percent of Tax Relieved
$0.00 to $25,000.00 100%
$25,001.00 to $27,000.00 75%
$27,001.00 to $29,000.00 50%
$29,001.00 to $31,000.00 25%
(c)
No lien shall accrue as a result of the amount certified as exempt under this section. However all other requirements and obligations found in this Article II shall apply to the individual under this subsection as if expressly set out herein including, but not limited to nullification upon change of status.
(d)
Any exemption under this section37-123 shall be nullified if the actual income and financial worth levels exceed the limitations.
Sec. 37-125. Nullification upon change in status.
. . . .
(b)
An individual who does not qualify for the deferral or freeze under this article based upon the previous year's income limitations and financial worth limitations, may nonetheless qualify for the current year by filing an affidavit no later than December 5th of the current year that clearly shows a substantial change of circumstances that was not volitional on the part of the individual to become eligible for the deferral or freeze, and will result in income and financial worth levels that are within the limitations of this ordinance.
Any deferral or freeze under this subsection must be conditioned upon the individual filing another affidavit after the end of the year in which the deferral or freeze was granted, but no later than February 1st showing that the actual income and financial worth levels were within the limitations set by this ordinance. If the actual income and financial worth levels exceeded the limitations, any deferral or freeze shall be nullified for the current taxable year and the taxable year immediately following.
. . . .
Sec. 37-129. Reserved