10-24-05 Regular Meeting of Fiscal Affairs Committee Minutes

Browse Search

• • exemption. With so many seniors, reducing the taxes they pay will hit Richardson harder than it will in growing cities such as Allen or Frisco, where less than 4 percent of residents qualify for senior tax breaks. At the same time, Richardson is leaning more heavily on property taxes to help run the city. In 1996-97, robust revenues from sales taxes made up 38 percent of the city's general fund. Property taxes shouldered only 22 percent of the burden. But that ratio has flip- flopped through the years. This fiscal year, property taxes will generate 39 percent of the city's $82.2 million general fund, officials said. Sales tax revenues -which plummeted after the Sept. 11, 2001, terrorist attacks -will make up 26 percent of the fund. Although the tech bust hit Richardson hard, there are positive economic signs. The city's $143 million budget approved in September reflects a 4.5 percent growth in the property tax base after three years of decline. However, sales taxes haven't fully rebounded. The city is forecasting a 3 percent increase in sales tax revenues in the next year. Despite concerns about city revenues, several council members said it was time to help seniors. The tax exemption has been at $30,000 since 1989, when the average Richardson home was valued at $97,491. Through the years, the exemption's value has been diluted as home values escalated. Although the council has considered a tax freeze for seniors, members said an increase in the homestead exemption is more equitable and would provide more value for residents. The proposed $50,000 exemption would save homeowners $105 across the board, while the economic benefit of a tax freeze would range from $26 to $105, depending on the value of the home. Richardson resident Ruth Bowling, a member of the Texas Silver Haired Legislature, said she's disappointed that the council favors the exemption over the tax freeze. Unlike the exemption, a tax cap cannot be rescinded after it's enacted, said Ms. Bowling, who began circulating a petition to get the tax freeze issue on the May ballot.