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Tax relief
proponents
face limits
By SHARON KILPATRICK
Rappahannock News Staff Writer
Four of the five counties surrounding Rappahannock have adopted some sort of real estate tax relief for their elderly residents with limited income and limited assets.
Rappahannock’s Board of Supervisors has asked the county’s residents to express their opinions on the idea at a public hearing Monday, March 6 at 7 p.m.
But lest the savings for elderly taxpayers — and revenue lost to the county — be counted too quickly, County Administrator John McCarthy cautioned that the state has put strict limits on those residents who would be eligible for the program.
“In a county this size,” he said, “where we have a dramatically aging population, on paper this looks like a sizable chunk of money. But, this is mainly a well-to-do population.”
Well-to-do, at least, when assets are tallied in the balance book. Ironically, the skyrocketing value of property in Rappahannock County means that a significant number of the county’s elderly are land rich and cash poor. Property bought years ago is worth far more now, and on paper represents a sizable asset.
“A lot of people qualify on the basis of income,” Mr. McCarthy said, “but very few qualify on the basis of assets, just by virtue of what things are worth — acreage, farm equipment and other personal property.”
Under the state statute which governs the programs, participating local governments (counties, towns and cities) can adopt a program which exempts qualifying landowners from all or a portion of their real estate taxes, or they can instead adopt a program which defers taxes until the owner dies or the property is sold.
To be eligible under the state’s guidelines, the owner must be over 65 or totally disabled and must have a net income of less than $22,000 per year, and a net worth of less than $75,000 excluding their house and up to one acre of land. In computing the income, that of both the owner and owner’s spouse is counted; added to that is the income of any other relatives living in tlm house, less an exemption of up to $6,500 per relation.
Mr. McCarthy pointed out that any tax exemption or deferral is money lost to the county treasury and would likely mean an increase in taxes for other residents to make up the difference. And, he added, the more residents who qualify, the more money that will be lost to the county’s treasury. Therefore, the amount or percentage of the exemption is likely to decrease proportionately.
Madison County, like Rappahannock, has no such program now.
Other surrounding counties have chosen to set more restrictive amounts for income, net worth, or both — which is also allowed under the state-enabling legislation.
The least complicated program is in Fauquier County, where the income qualification is set at $18,000 and the net worth limitation is set at $50,000. For residents who meet those qualifications, all real estate taxes are exempted.
Page County has an income limitation of $12,000 and a net worth cap of $40,000. Among those who meet the limits, there is a sliding scale based on income which determines what percentage of the real estate taxes are exempt. The scale ranges from 25-100 percent. Those with less than $7,000 in income are 100 percent exempt, and percentages drop as income increases so that those with between $11,001 and $12,000 are exempt from 25 percent of their real estate taxes.
Culpeper County’s program is similar to Page’s, with an income limit of $18,000 and a net worth limit of
See RELIEF, p. 16
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