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APPROPRIATION COMMITTEE-ATM 20 1
<br /> Article 37: Accept Massachusetts General Laws Chapter 59, Clause 5C%
<br /> Funds Requested Funding Source Committee Recommendation
<br /> none (but see below) see below Approve (9-0)
<br /> This article proposes that Town Meeting vote to accept a state law which gives towns the option to in-
<br /> crease by up to 100% certain so-called "personal exemptions" from local property tax available under
<br /> G.L. c. 59, §5, most notably for low-income residents over 65 years of age, disabled veterans and the
<br /> blind. This article does not request an appropriation. However, because the state will not reimburse the
<br /> Town for the cost of this "optional additional exemption," the incremental cost, estimated at up to
<br /> $90,000 annually based on existing usage, would be borne by the Town from its overlay account.' The
<br /> existing overlay account is believed to be adequate for this purpose in FY2019.
<br /> Background
<br /> As discussed at length in Appendix D to this report, the Tax Deferral and Exemption Study Committee
<br /> (TDESC), created by the Board of Selectmen in 2004 to explore ways in which the property tax relief
<br /> available to low-income senior citizens and other needy residents could be enhanced and made more ac-
<br /> cessible, has brought before Town Meeting since that time a series of steps to accomplish that goal. In a
<br /> succession of actions, the Town has now for the most part maximized the tax relief options available un-
<br /> der the state's General Laws, and in some cases,by Special Act of the State Legislature or otherwise, sig-
<br /> nificantly enhanced them.
<br /> By general legislation enacted in 2014 (the 2014 Veterans' Allowances, Labor, Outreach and Recognition
<br /> Act, now codified as G.L. c. 59, §5C'/2), the State Legislature made available to Massachusetts communi-
<br /> ties statewide a new opportunity to increase the amount of local property tax exemptions for certain low-
<br /> income seniors and other categorical recipients who have previously received the benefit of such relief.
<br /> By vote of Town Meeting to accept this statute, the specified personal exemptions —which include those
<br /> listed below and are mutually exclusive, i.e., each recipient may qualify for only one —may be increased
<br /> by up to 100%,provided that the same percentage increase is applied across the board.
<br /> • Clause 22, certain veterans, $400, currently 70 recipients
<br /> • Clause 22E, certain veterans or surviving spouses, $1,000, currently 9 recipients
<br /> • Clause 37A,blind, $500, currently 13 recipients
<br /> • Clause 41C,low-income elderly, $1,000, currently 24 recipients
<br /> Application
<br /> Thus, for example, if Town Meeting accepts the statute with a 100% increase, a low-income senior
<br /> homeowner currently receiving an annual exemption of$1,000 under Clause 41C would receive an ex-
<br /> emption of$2,000. That percentage would remain in place for each succeeding fiscal year unless and until
<br /> Town Meeting voted to change it. Town Meeting may also vote to revoke its acceptance of the statute
<br /> entirely once three years has elapsed from its initial acceptance.
<br /> Except in the case of hardship exemptions under Clause 18 (of which there are currently none in Lexing-
<br /> ton) and deferrals under Clauses 18A(temporary hardship) and 41A (for eligible low-income seniors), the
<br /> 70 The overlay account is a fund which the Town sets aside annually as part of the budget, without the need for ap-
<br /> propriation in an amount recommended by the Board of Assessors, primarily to cover the anticipated expenses of
<br /> successful requests for abatements from the local property tax. The overlay account is proposed to be funded this
<br /> year at $750,000,but there are also substantial balances remaining from prior years which can now be considered,
<br /> under the Municipal Modernization Act, as part of a single account. See Brown Book p. TT-3. After all outstanding
<br /> abatement and exemption issues have been resolved, unused amounts in the overlay account may be returned to the
<br /> General Fund.
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