Homeowners in Brookhaven could benefit from property tax savings beginning in 2020 as city leaders look to double the city’s homestead exemption over the next five years. The city is also seeking to significantly increase property tax relief for eligible senior citizens and those living with disabilities as a way to address housing affordability, according to officials.
Mayor John Ernst introduced and the council approved a resolution at the City Council’s March 12 meeting to increase the city’s homestead tax from the current $20,000 to $40,000 by 2025.
Residents age 65 and older and those with disabilities who make less than $15,000 a year are eligible for an additional $14,000 exemption. Under the city’s resolution, that $14,000 would jump to $160,000 over the next five years, or at an annual increase of $29,200, Ernst said.
The resolution for the increased property tax savings for homeowners, seniors and those with disabilities now goes to the General Assembly where a bill approving Brookhaven’s request must pass by a two-thirds majority in both chambers. The General Assembly is slated to end April 2. Local legislation like this bill can be introduced in the final days of the session.
If approved by the state legislature, the proposed tax relief legislation will then be placed on Brookhaven’s Nov. 5 ballot for voters to decide.
“We’re taking a stair-step approach to double our homestead exemption over five years and for the average homeowner that means a savings of almost $53 in property taxes a year,” Ernst said in an interview.
For senior citizens and those with disabilities who qualify, the savings would be significant and even wipe out for most any payment of city property taxes, Ernst said.
There are 724 of the 852 properties that are currently eligible for the senior/disabled exemption, he said. “In the end, 85 percent of those [seniors and disabled] who qualify would no longer have to pay city property taxes,” he said.
For the remaining homeowners currently receiving the senior/disabled exemption, the average city property tax reduction would be $189.98 annually once fully implemented after five years, he said.
When Brookhaven was incorporated in 2012, the city adopted DeKalb County’s property tax exemption limits for homesteaded properties and for seniors and disabled residents. Homestead exemptions must be applied for through DeKalb County and are not available for rental or commercial properties. A basic homestead is an exemption that can be claimed against the taxable value of a home as long as it owned by the resident and is their primary residence.
“Our senior citizens have already paid their dues, and our disabled residents are already fighting an uphill battle,” Ernst added in a prepared statement. “This legislation protects affordable housing as well as lowers the overall tax burden for these homesteaded property owners. All homesteaded homeowners will get property tax relief.”
The proposed property tax reductions for seniors, the disabled and homestead properties will lower city revenue by $1.6 million over five years, according to city officials.
Councilmember Joe Gebbia said the city’s portion of the DeKalb County property tax bill is minuscule. The county and the DeKalb County School District take in most of residents’ property taxes. He also noted the idea to address homestead exemptions in the city was included in the 2017 recommendations from the city’s Affordable Housing Task Force and that affordable housing should be addressed by other municipalities.
“I want others to emulate this [legislation] and especially for this age bracket,” he said.
Assistant City Manager and CFO Steve Chapman said the City Council [with its vote] is “sending a message to DeKalb County” that affordable housing for senior citizens who want to stay in their homes as property values continue to increase is an issue that needs to be addressed.
“By taking this action, we’re encouraging home ownership and protecting our seniors and disabled,” Councilmember Linley Jones said. “We encourage DeKalb County and the Board of Education to follow our lead.”
Ernst asked city administrators in December to look into finding property tax relief for homeowners following approval of the $40 million parks bond referendum.
The parks bond to be paid off over 30 years will raise the city’s 2.74 millage rate by half a mill, or an average of $98.34 a year to the homeowner with a home assessed at about $466,000, according to city officials. The millage rate is used to determine local taxes and is the amount taxpayers pay per $1,000 of assessed value.
City officials have said the property tax increase is expected to be offset by other tax changes, including the recent implementation of the equalized homestead option sales tax and when a DeKalb County parks bond rolls off property tax bills in 2021.
But Ernst said as part of the city’s affordable housing efforts, he wanted City Manager Christian Sigman to bring proposals on finding tax relief by millage rate reduction and an increase in homestead exceptions to eliminate net property tax impact of the parks bond. The city recently adopted a new zoning code that includes affordable housing mandates for new multi-unit developments.
The city’s Nov. 5 ballot will include the election of mayor and City Council Districts 1 and 3 seats. Ernst is seeking reelection as mayor, Jones is seeking reelection for District 1 and Councilmember Bates Mattison is seeking reelection for District 3.
This story has been updated.