On February 13, 2024, Legislative Director Kevin Kinnally testified before the House Ways and Means Committee in opposition to HB 220- Homestead Property Tax Credit- Calculation of Credit for Dwelling Purchased by First-Time Homebuyer.
This bill would open up property tax savings under the Homestead Property Tax Credit to be "portable" for specified homeowners. This dramatically undermines the longstanding policy purpose of the credit – to ensure stability in tax bills after purchase.
From MACo Testimony:
Counties oppose this bill because it compromises the basic nature of the Homestead Property Tax Credit and threatens a severe fiscal impact on county budgets. The Homestead Property Tax Credit acts to essentially cap assessments of owner-occupied residences so that a resident's property tax burden does not increase too substantially over the prior year. It provides consistency for taxpayers who live in and own their homes. Nearly every county has exercised its authority to lower its cap, giving security to homeowners beyond that required by the State.
However, if the tax credit were expanded to all homes transferred to new homeowners, counties could lose up to $16 million of their most reliable revenue source by fiscal 2028, according to the bill's 2023 fiscal note. Counties could be forced to eliminate their expansions of the Homestead Property Tax Credit where feasible – or, potentially, cut budgets for schools, housing, public health, public safety, roadway maintenance, and other essential public services.
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