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Home My WebLink About2018-12-11-RESPC-min (public hearing) Public Hearing of the Residential Exemption Policy Study Committee (Ad Hoc) Public Questions and Comments Tuesday, December 11, 2018 Estabrook Room, Cary Memorial Building Call to order 7:02PM LexMedia is recording/live; the video is available through LexMedia OnDemand http://www.lexmedia.org/ondemand.html Public Attendance: approx. 25 Lexington residents Mr. Andersen Hearing agenda Introduction of Committee members and Selectman Liaison Mr. Andersen Main presentation Ms. Cutler managed Q&A, Open comment period Presentation slides are archived with the Lexington Town Clerks' office. Question and Answer portion [for this section: questions in italics, responses from Committee members in regular type.] Frank Sandy How are a person's assets determined?It may be inaccurately reported, either accidentally or deliberately. On Concord's form, you identify all accounts, properties, etc. on the application form. But on the whole, assets test is a grey area because there is no clear asset threshold. The program is not intended for people with many assets. On the whole, it is challenging to evaluate, and requires a lot of work by the Assessor's office. Patrick Mehr In the towns that have adopted a Means Tested exemption, how many people get it?How big a percent of the eligible pool and of the entire population? Concord—about 250 residents receive the state Circuit Breaker, and about'/4 of those received the Wayland-style exemption—this number is smaller because of people's assets. So that would be about I% of taxpayers. Among those who report stress in your survey, assets were not asked for, but assets may be the crux of the issue for many retired residents. We did not ask about assets on survey in order to not undermine response rates to survey. Tom Shiple—Thanks. I have friends who, when their kids graduated high school, moved away to pay lower property taxes. They could have afforded the taxes, but that was their preferences for how to spend their money. Are we trying to solve the problem of families like that or others? Yes and no. Individuals on this committee provided a variety of personal responses to this question. Matt Daggett Equalization (Capitalization) effect: what are the examples of this; what is the evidence? Assessments track to market value, and many buyers have an amount they can pay per month (mortgage +prop tax), so when taxes are lower, people can afford to offer more toward home purchase value. Is the counter true too—does a Residential Exemption devalue properties at the high end? Yes, that is expected as well. Pat Costello Excellent, understandable presentation. For the Residential Exemption, was there a residency requirement? Yes, you would qualify for the Residential Exemption upon becoming a resident of a property you own. Some exceptions would be: there is the potential for one-year lag times and trusts issue exi sts. Margaret Coppe—Thank you. I missed the May meeting. Where would I find the slideshow online?I could not locate it on the town website. Also, could there be break points for ages above 65 for the Means Tested approach? The presentation can be found online in the Lexington town archives; the May 29, 2018 entry. http://records.lexin tog__rl�aY�ov/weblrnk10/doc/348074�Pa eg 1.aspx Yes, that is a recommendation we could make to Board of Selectmen. Public Comment portion Elizabeth Barnett—Thank you for your work. The Wayland model Circuit Breaker matching approach might work. I have experience helping seniors apply for Means Tested relief. Means testing is very difficult. Sam Silverman—Thank you for this presentation, which raises a lot of questions for me. I object to getting a tax deferral because then the town becomes my heir, rather than my children. I prefer to leave my property to my children. I also object to the idea that I'm an average person; we need to make more distinctions within our population. I'm 93years old. Statistics based on a 70+years age group is too lumped; 90+is very different than 70. In the past couple years, my wife has died. One of the effects of her having died has been that the cost of running the house remains the same, but my household income is down by 20% because of my pension income versus my wife's social security income reduction. Property tax doesn't take changing life circumstances and their impacts on income level into account. Because I am over 90 years old, I'm also likely to develop more illnesses, so medical and dental costs will rise. I am facing financial penalties from having managed to live this long. Main point—I'm an individual, not an average or a statistic. The information shared in the presentation tonight is drawn from abstractions, not real people. Denise Dracup—Last year I did not get the state Circuit Breakers, but I was eligible the prior year. I became ineligible last year by taking $5k out of my IRA(which I had used for medical purposes) because it was considered income. I would prefer a Means Tested approach over the state Circuit Breaker. Glen ParkerI have several notes about the slideshow presentation. The survey's correlation between age & stress: those who are in their 70s made their decisions in their 60s. Those who were stressed then maybe already left. Renters: would a Residential Exemption or other approaches actually have an impact on rent increases or not? There's no guarantee about that. Relative tax rates (peer benchmarking slide): it's misleading because you need to look at assessments at the same time, actual tax bills, not just compare percentages. Schools: Everyone uses the schools in Lexington, whether they have kids or not—the schools keep their property values up. Residency time requirement: concerns me as potentially discriminatory. Patrick Mehr—How do you know people who come in to rent are not people who just come in for the schools rather than the lower income/stressed residents characterized in the presentation? There is no data to confirm renters, as a group, have lower assets than home owners. It's a mistake to conflate Residential Exemption and Means Tested approaches because the magnitude of people affected is wildly different. Note, we already have a Residential Exemption in Lexington. It happens to be 0%, but no one has ever asked whether it is means tested. A Means Tested exemption would affect only 1% of taxpayers. A Residential Exemption could give progressivity to the tax burden, and we should not assume burden on renters is real. We know nothing of their asset base. Among homeowners, the rich should pay more. Don't split hairs on what affects only 1% of taxpayers when we have a real issue of more town capital projects coming. Also, getting a home rule petition passed by the state legislature is not always so easy. Bob Pressman—None of the economists recommended the Residential Exemption approach. One referred to it as a"blunt instrument." I investigated all the condo units at four locations in town. Of 186, 15 are not owner-occupied. How many are owner-occupied is not known. How many would get a Residential Exemption is not known, but potentially all of the remaining 171 would qualify for a Residential Exemption. Condo owners may be very wealthy, even if they don't have the highest property values in town. Peter Kelley—This topic has been important to me for many years. It's important to address those that have a need, and also everyone has to agree to pay their fair share. This is why I'm a fan of the deferral program. The town doesn't become your heir in that case, they become your partner. Your home value continues to increase, so you would still be leaving more value to your kids. We need to identify those who most need help & help them so they can stay, and make sure everyone pays their fair share. Staying in Lexington is a great investment. Public Hearing adjourned 8:38pm.