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HomeMy WebLinkAboutIR 8390 INFORMAL REPORT TO CITY COUNCIL MEMBERS No. Ingo u March 26, 2002 To the Mayor and Members of the City Council Page 1 of 4 SUBJECT: AD VALOREM TAX EXEMPTION POLICIES AND PRACTICES State laws governing property tax administration provide for certain exemptions, which may either partially, or totally exempt real or personal property from taxation. Some exemptions require only that property meet certain criteria before the appraisal district may grant the property owner's application for exemption. Other exemptions require specific action by the taxing,authority before the exemption may be requested by the property owner_ Those exemptions currently being claimed by Fort Worth property owners and over which the City Council exercises no discretionary power are: AGRICULTURAL, FREEPORT, FOREIGN TRADE ZONE, DISABLED VETERANS, SCENIC LAND, SOLAR AND WIND POWERED ENERGY DEVICES, POLLUTION CONTROL DEVICES, PRORATED ABSOLUTES, AND NOMINAL VALUE PERSONAL PROPERTY. The City Council has the option, on an annual basis, to increase or decrease certain exemptions presently being claimed by property owners in Fort Worth. These"local option" exemptions include: i. GENERAL RESIDENCE HOMESTEAD EXEMPTION - exemption of not less than $5,000 and not to exceed 20 percent of appraised value (will remain at current level of 20 percent for Fort Worth citizens unless other action is taken by City Council prior,to May 1.) 2. SENIOR CITIZEN HOMESTEAD EXEMPTION - in addition to the General Residence Homestead exemption, for the aged 65 or older property owner, an exemption of$3,000 of appraised value or larger, if larger amount is established by the governing body or by voters(will remain at current level of$40,000. unless revoked or increased by City Council.) 3. DISABLED HOMESTEAD EXEEMPTION - exempts not less than $3,000 of assessed value for the homestead of disabled property owners, who are 100 percent disabled and unable to work due to their disability as determined by Social Security standards and confirmed by a physician(will remain at current level of$40,000 unless amended by the City Council prior to May 1.) 4. HISTORIC ST'I'ES EXEMPTION - exemption of part or all of assessed value of property designated by the Texas Historical Commission or local governing body as an exempt historical site. (Practice by Fort Worth City Council has been to exempt increase in value resulting from renovation or preservation of a designated historical site-each site is presented to Council on an individual basis.) wv,, .rwunnrmimmmwkhra�9mm ummrinr i� � o ISSUED BY THE CITY MANAGER FORT WORTH_TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 8390 or" March 26, 2002 * To the Mayor and Members of the City Council Page 2 of 4 lays ' SUBJECT; AD VALOREM TAX EXEMPTION POLICIES AND PRACTICES A comparison of various taxx exemptions in selected Texas cities is outlined below: RESIDENCE HOMESTEAD EXEMPTIONS Freeport General Sr. Citizen Disabled Exemption Arlington 20% $55,000 $55,000 yes Austin none $51,000 $51,000 yes Dallas 20% $64,000 $64,000 yes El Paso none $15,000 $15,000 yes Fort Worth 20% $40,000 $40,000 yes Houston 20.0 $34,000 $34,000 no San Antonio none $60,000 none yes The average value of a single-family residence in Fort Worth is$74,140 for the 2001 tax year. Since the 2001 tax rate is $0.865/$100 value, the impact the various optional exemptions have on property with an average value, as well as property of greater and lesser values, is listed below: 2001 City Taxes on a House with a Value of Exemption $74,140 $30,000 $100,000 No exemption $641.31 $259.50 $865.00 General homestead 513.05 207.60 692.00 Sr. Citizen w/general homestead 167.05 -0- 346.00 Disabled homestead* 167.05 -0- 346.00 *Homeowner cannot claim both Senior Citizen and Disabled exemption. iorviooiiwwwomamwuwwlwia'miNtimuummlumoWNliliMmOlNNllm",:M1���'fi (( 7 ISSUED BY THE CITY MANAGER FORT WORTH_ TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 8390 March 26, 2002 To the Mayor and Members of the City Council Ar Page 3 of 4 fayi ' SUBJECT: AD VALOREM TAX EXEMPTION POLICIES AND PRACTICES The amounts of assessed value and tax revenue lost due to exemptions are presented on the following tables: ASSESSED VALUE LOST TO EXEMPTIONS FY 2000-01 FY 2001-02 Total assessed value: $24,702,811,370 $28,190,510,698 Value lost to exemptions: general residence homestead 1,417,767,833 1,624,675,464 senior citizen homestead 769,727,718 800,310,608 agriculture 380,275,676 477,102,060 freeport goods 1,684,086,318 2,396,461,949 disabled residence homestead 59,551,117 59,222,108 scenic land 5,789,310 5,814,605 disabled veterans 28,889,226 29,688,338 historic sites 21,433,045 27,973,852 solar/wind energy devices 13,886 13,886 abatements 530,719,609 450,755,270 pollution control devices 5,275,154 2,072,127 foreign trade zone 47,924,125 * 50,174,693 prorated absolute 3,616,762 12,709,242 personal property nominal value 171,471 139,305 Total value lost to exemptions 4,955,241250 5.937.113,507 Net assessed value(as of September) $1 9,747,570,120 $22,253,397,191 *Note:Nokia did not file for a foreign trade zone exemption due to massive inventory reductions. w„ ,,��uiomooimmwwwuunauwr�iminarvrammruruwru!wwuooamueom rq ( af tF � J ww 1 ISSUED BY"rHE CITY MANAGER FORT WORTH. 'TEXAS INFORMAL REPORT TO CITY COUNCIL MEMBERS No. 8390 March 26, 2002 1' F To the Mayor and Members of the City Council Page 4 of 4 SUBJECT: AD VALOREM TAX EXEMPTION POLICIES AND PRACTICES REVENUE LOST TO EXEMPTIONS FY 2000-01 , FY 2001-02 General residence homestead* $12,405,468 $14,053,443 Senior citizen homestead* 6,735,117 6,922,687 Agriculture 3,327,412 4,126,933 . Freeport goods 14,735,755 20,729,396 Disabled residence homestead* 521,072 512,271 Scenic land 50,656 50,296 Disabled veterans 252,781 256,804 Historic sites* 187,539 241,974 Solar/wind energy devices 123 120 Abatements* 4,643,797 3,899,033 Pollution control devices 46,158 17,924 Foreign trade zone 419,336 434,011 Prorated absolute 31,647 109,935 Personal property nominal value 1,500 1,205 Total revenue lost to exemptions $43,358,361 $51,356,032 *Discretionary Property owners have until April 30a' to apply for the various property tax exemptions currently offered by the City for the 2002 tax year. The last day the City Council may change the various local option homestead exemptions in order to impact the FY 2002-03 budget is April 30, 2002. Staff is available to provide additional information if the City Council should require it. II` I • � f ,F UIY ��- If� I �Oi' � I��y r '� f ) I✓ .- 1 o-1{ Gary W. Jackson City Manager ISSUED BY THE CITY MANAGER FORT WORTH. TEXAS